Sveriges Riksbank, the central bank of Sweden, will carry out the next stage of its e-krona project with the help of two organizations from the financial sector. The move signals a transition from the initial in-house testing with simulated participants to cooperation with real, external partners.
Riksbank to Work With Handelsbanken and Tietoevry to Test E-krona
The main task during the new phase of the pilot will be to trial “the technical solution for the e-krona” with the participation of real market entities. To accomplish this, Riksbank has invited Handelsbanken, one of the country’s major banking institutions, and Tietoevry, a digital services and software company. In an announcement published Friday, the regulator noted:
Involving external actors as participants in the test environment will make it possible for the Riksbank to evaluate the integration between the participants’ existing systems and the technical platform for the e-krona pilot.
One of the elements that will be tested is the integration of the payment flows developed during the first year of the pilot with the internal systems of the new participants, Riksbank explained. The partners will simulate how banks might interact with the e-krona infrastructure, Tietoevry detailed in a separate press release, elaborating:
Tietoevry will develop and test the process of interchangeability between commercial money and e-kronor and analyse how this can be carried out securely and efficiently.
The Finland-headquartered company also noted its “unique position in the Nordic financial ecosystem” thanks to a large customer base consisting of banks and payment providers. Over 70% of all Nordic bank transfers go through its payment systems and the fintech enables the leading mobile payment providers in Sweden, Norway and Finland.
Central Bank of Sweden to Integrate E-krona With Existing Banking Infrastructure
“Our role in the Swedish payment infrastructure is well established, and Tietoevry is a natural partner when exploring how to integrate a digital currency with existing banking infrastructure,” said Christian Segersven, head of financial services solutions and software development. “We are looking forward to supporting this journey towards an inclusive digital currency that will open up for innovative and secure services,” he added.
Svenska Handelsbanken, the other partner to get involved in the second stage of the e-krona pilot, is one of Sweden’s largest banks, with more than 400 branches across the country. Founded in 1871, it’s also the oldest company listed on the Swedish stock exchange. In the past couple of decades, Handelsbanken has been expanding its operations in other countries in the region as well as Netherlands and the U.K., where it has over 200 branches.
Sweden’s plan to issue a central bank digital currency (CBDC) dates back to a few years ago. Towards the end of 2020, the government in Stockholm began exploring the feasibility of digitalizing the national fiat, the Swedish krona. Arguably, the Scandinavian country has already built the world’s most cashless society. The review should be conducted within two years of its launch.
Last month, Riksbank announced the completion of the first phase of the study and released a report which highlighted the continuing decline of cash usage in the country. The central bank of Sweden emphasized the need to proceed with the project and facilitate the involvement of market actors expected to take part in the testing now and join the e-krona network in the future.
What do you think about Riksbank’s plan to digitalize the Swedish krona? Let us know in the comments section below.
During an interview this week, Metalla Royalty & Streaming CEO, Brett Heath, explained that he believes cryptocurrencies will lead to the next financial crisis. The precious metals boss said history shows that “mass adoption of a new financial product” typically leads to a financial crisis.
Precious Metals Exec Says the Public Embracing Crypto May Lead to a Financial Disaster
Brett Heath is the CEO of Metalla Royalty & Streaming (NYSE: MTA) (TSXV: MTA), a company designed to generate leveraged precious metal (PM) exposure via royalties and streams for shareholders. On May 27, Heath spoke with the precious metals news desk from kitco.com and explained that he believes the mass adoption of digital currencies like bitcoin will lead to catastrophe. Economic calamities begin when society adopts a new financial product Heath asserted.
“When you look back to the last few decades and all of the financial crises that happened, they all have a couple of things in common. And one of them is the mass adoption of a new financial product or a new technology that is not very well understood,” Heath stressed during his interview with kitco.com’s David Lin.
Heath further remarked that it reminds him of the subprime mortgage crisis that tossed the financial world upside down 12 years ago. Heath added:
If we just rewind to the mortgage crisis of 2008— We had the mass adoption of mortgage-backed securities, collateralized debt obligations. And once the public had embraced this, this new financial product, then it crashed. It was a huge problem.
Crypto Adoption Will Lead to ‘Significant Financial Repercussions’
Heath continued by adding that he was skeptical of the money that has entered into the crypto economy and said that the industry was a “license for the private sector to print money.” But he also called into question the Federal Reserve’s expansion of the American money system. The PMs proponent emphasized that the crypto economy has grown at an exponential rate as well. “If you look at cryptocurrency using the total market cap of cryptocurrency, it’s over tenfold,” Heath stressed.
Business has been booming for PM companies like Metalla Royalty & Streaming as the price of gold is tapping new highs again. Gold is trading for $1,904 per ounce while silver is trading for $27.92 an ounce at the time of publication. This past March, Heath’s company acquired royalty on Eldorado Gold’s Tocantinzinho Project (NYSE: EGO) (TSX: ELD). Heath said he was thrilled to work on a project that will cover “over 2 million ounces of gold.”
While speaking with kitco.com’s David Lin, Heath said that the crypto economy seems to be a recipe for disaster and he thinks it could very well lead to a possible financial crisis. “The crypto market could go upwards $3-$10 trillion. When you have that amount of capital wiped out of digital wallets across the globe, you better believe there is going to be some significant financial repercussions that are felt,” Heath concluded.
What do you think about the Metalla Royalty & Streaming executive Brett Heath’s opinion about crypto creating a financial disaster? Let us know what you think about this subject in the comments section below.
When lawmaker meets crypto and turns to art: Alberto Echegaray talks about the future of DeFi and the reality of Bitcoin and art.
It’s all about the economy, cryptocurrencies, art and future projections. To talk about all this, Cointelegraph en Español reached out to artist Alberto Echegaray, the director of Trustlink and former representative of Argentina in the Financial Action Task Force.
Cointelegraph: Let’s start off by talking about your artwork, the Moneyball.
Alberto Echegaray: Moneyball began developing in 2012. It is a piece that touches on something that is taboo in art: money. And it is still taboo, although it is something that is changing now with NFTs.
What Moneyball wants to show is how most, or basically all, fiat currencies have no backing in the world right now. And how many governments take advantage of issuing these currencies to generate inflation, which is basically a tax — a phantom that takes away people’s purchasing power.
With this concept, I started to work on Moneyball with dollars. I lived in Washington, DC for about 12 years — I did some consulting for the Fed. That’s how I came to the Fed, I was invited to tour the facilities of a division where they print dollars.
At that time, they were replacing old dollars with the new dollars that are in circulation now. In one part, I found a huge warehouse with billions of dollars destroyed. That’s when I thought, This is incredible. You couldn’t take pictures — there were a lot of security measures. I asked for the destroyed money, but I was told that the money is state property, it’s not our property. And even if it’s destroyed, it’s still federal property.
I had to write a series of letters, and after several months, they gave me two million dollars in 100-dollar bills, destroyed. And so I began to create the artwork.
CT: And how did you come up with the idea of adding Bitcoin to your work?
AE: At the end of 2013, a Venezuelan in San Francisco told me about BTC and gave me some, which I still have. I didn’t pay much attention to it until 2015 or 2016.
I talked to several people in Silicon Valley, and they were telling me that it was going to be part of the future, especially blockchain. I started buying Bitcoin and really getting into it. Then I opened a fund and became a crypto missionary.
“It was super interesting. Bitcoin started to grow. And at that time, I was able to travel to different countries for work. I started to discover resistance from all of the financial sectors. It seemed like I was talking about something linked to crime or money laundering. It was terrible.”
But in 2016, I was contacted by a person who became part of the Argentine government and needed some help with technology to prevent money laundering and terrorist financing. It was Mariano Federici, head of the Financial Investigations Unit. The FIU had practically nothing to fight against money laundering with Bitcoin and crypto. It was a mess. I was asked to help, and it was an interesting challenge. More advanced systems of analysis, data and information were installed.
But I was not interested in the prosecution part of the crime; I was much more interested in the technical and crypto part. At that time, Europol held a meeting where security specialists met on the subject of crypto and cybercrime. I was new, but I was invited by the Argentine government. Then, I was invited again to the FATF, and there I met some people — specifically from the U.S., China, Russia, South Africa and Australia — who knew something about crypto. They were a very strong team. And I started to see how regulations were going to develop
CT: Did you want to do more and see the other side behind the curtain?
AE: That was in 2016/2017. But before I joined FATF in the Argentina chair, I had four years of experience working in Paris on regulatory issues. I had started to develop, in parallel, a private note off-market, and it was the first synthetic with the underlying asset being Bitcoin.
And there, I was able to structure a financial product that you could invest from a bank account. It was super successful, until the banks told me that they could not accept money because it involved BTC.
I started thinking about Cryptoball. If I had gone through fiat money, showing it to be worthless, I said I’m going to try it with crypto. I started developing the Cryptoball, but in 2017/2018, it was hard to get curved displays that would show the price of BTC. I had to contact a person in China who gave me access to flexible screens.
Cryptoball is a sphere with two flexible screens connected to software in a processor. The processor shows the real-time value of BTC that is held in a hardware wallet within the piece. It shows the price in yen, euros and dollars. By that time, I got 250 BTC, and I placed them in the Ledger wallet.
“Next to the installation at the Venice Biennale, I placed a million dollars and a million euros. There were a lot of young people. Many people from the art world asked me what it was because they didn’t understand.”
That’s when a European collector who I didn’t know approached me. He offered to meet me at a restaurant the next day. It was very interesting because then they contacted me on his behalf and talked about “His Royal Highness.”
He turned out to be a prince who is very supportive of the culture. We sat down and talked about the artwork. I couldn’t believe it because the Venice Biennale is not a place where you sell.
The Biennale ended, and I took the artwork to his house, a place in Switzerland. It’s a very interesting story.
CT: The art and crypto worlds are getting along very well. What do you think about NFTs? Do you have plans to work with this technology?
AE: I am starting the process of tokenizing some works. I’m thinking about tokenizing the sphere, but I want it to be something interesting. Not just a 3D design of artwork or a sculpture but, for example, a kind of live ticker that shows the price. Something that exists in real life, that exists in parallel in different dimensions.
I’m also working on 3D mapping and augmenting reality with a group of people. I was also invited to be an adviser on an NFT platform that has established artists.
I think we are at the beginning of tokenization and a lot of interesting things that can spread the art. By this, I mean that before, it was very difficult for artists who graduated from art schools to access galleries. This is changing dramatically. Now, art school graduates who have chosen to dedicate themselves to digital or virtual art are getting job offers, as is happening in the gaming sector, for example.
This is added to all the mass consumer brands that are getting into the virtual world. It’s amazing what’s coming.
CT: Regarding the future of private banking, do you think that banks are going to work with crypto or against crypto?
AE: All the big banks already have large crypto research divisions. They know that this is a new system within the financial system. It’s like when we talk about landline phones and cell phones — they are going to end up cannibalizing everything.
But they are still clinging to their transfer systems and their ways of charging commissions and making money, and they haven’t realized that this has changed dramatically.
“If they don’t understand staking or DeFi, and if they don’t adopt it quickly, they are going to see their business disappear overnight. There are some who try to understand it, but it’s very difficult.”
The same goes for regulators. There are not enough human resources to ask who understands both worlds. And there is no capacity, brainpower and determination. They think it is still a long way away.
CT: What do you think the state of the global monetary system will be like in 2030?
AE: I think there will be huge opportunities for the new generations. It’s a parallel system of governments, which is based on the speed of technology. I think in 2030, there will be a society that is more integrated on the one hand, but more discriminatory on the other. They are going to be very powerful groups.
What we are seeing with crypto is basically a revolution of assets or private currencies like we have never seen before. In the case of crypto, I clearly see private systems, linked to private space systems, which may or may not be open source. I see banks in this space, much more evolved digital assets, and the tokenization of commodities happening in the future.
Traders do not want to lose control of all this. That’s kind of the projection I see. I think there will be a new system that is neither capitalist nor socialist.
The world of cryptocurrency shares a similar template to the emergence of the World Wide Web back in the 1990s.
This year marks the 30th anniversary of the first web page on the World Wide Web, which means a person has to be nearly half a century old to clearly remember the patchwork progress, the false starts and stops, and the trial and error that eventually gave us what is now the defining foundation of 21st-century life.
We take the internet for granted in 2021, but it took us decades to get to this point. Throughout the years, the barriers toward adoption tumbled away, and there were clear signs that this new technology would fundamentally change the way the world lives and works.
Now, soaring Bitcoin (BTC), the blockbuster initial public offering of Coinbase and the appointment of MIT blockchain professor Gary Gensler to lead the United States Securities and Exchange Commission are offering clear signs that another technology will be transformational on a similar scale: cryptocurrency.
Do these recent developments mean crypto is approaching its “Netscape moment?”
In the early ‘90s, the internet was about connecting through a phone modem to three major services — AOL, CompuServe and Prodigy — all of which made up what we called the “World Wide Wait,” which illustrates the headache that was caused by loading those rudimentary pages. For those of us old enough to participate in these earliest days of the transition, all the way to a consumer internet, we remember well that moment when everything changed.
It was August 1995, when Netscape went public with its main product Navigator, the first browser that allowed anyone to surf the net without having to pay for “World Wide Wait’s” services. This was the moment internet adoption went mainstream, and it created a frenzy that lasted until the dot-com burst in April 2000, establishing the investor and consumer template for thinking about the internet and the World Wide Web.
Related: Blockchain Is Evolving Like the Internet: Who Will Be the Crypto Hotmail?
Crypto’s timescale: Are we there yet?
It is difficult to see tomorrow’s certainty, or at least the narrative of tomorrow that is described by today, when you are preoccupied with the uncertainty of the present. Perhaps there is no endgame in technology as a whole, making it as mysterious and tantalizing as the world of crypto.
However, it is hard not to see the parallels between the current state of crypto adoption and the internet as it existed in 1995. Despite the many news cycles obsessed with booms and busts in pricing, in terms of true financial and technological use, crypto still remains the playground of early adopters and geeks. Many institutions and professional investors are interested in playing around with it, but the vast majority of major institutional finance has yet to engage with it in any serious way.
Related: Institutional investors won’t take Bitcoin mainstream — You will
I believe 2021 will be the year when all of this changes. The global COVID-19 pandemic has led to massive fiat money-printing everywhere in the world. The cryptocurrency market stands at around a $2 trillion market capitalization, and Bitcoin is in the news daily, arguably with more regularity and over a longer period of time than it enjoyed during the boom of 2017–2018.
This new hype cycle comes with the gradual increase of general crypto awareness that has been on the rise since 2017–2018, and professional investors and institutions are even more keen to dip their toes into the water of crypto, even if that only means developing a Bitcoin exchange-traded fund.
History doesn’t repeat, it only rhymes
Crypto seems like it should be inevitable — id est, vires in numeris. The mathematical school of Thales and Satoshi Nakamoto should also keep that old phrase from the empiricist Immanuel Kant in mind: “Out of the crooked timber of humanity, no straight thing was ever made.” We cannot overlay the timeline of the internet onto crypto and say, “Aha! This is when it will happen.” Some timescales of adoption and development may continue to accelerate, while others stall behind.
External events may also intervene, such as a pandemic. Initially thought to be an event that may halt crypto markets and innovation, due to the initial financial panic and need to liquidate, the price of the flagship Bitcoin has increased tenfold in the first year of the pandemic. Governments put themselves at monetary hazard with debt spending, and people dug deeper into the online world than they did before, adhering to the cryptocurrencies that define so much online life and discussion.
Related: How has the COVID-19 pandemic affected the crypto space? Experts answer
One thing that is certain is that for crypto to enjoy that “Netscape moment,” especially in the Western world, it will need advocacy and cooperation from the U.S. government. The Netscape moment will happen when the U.S. government, particularly the SEC, comes out with clear regulations about fundraising, custodianship, “Know Your Customer” guidelines, taxes, investment and transfer rules. Even better would be the SEC declaring that crypto is not a security but a whole new asset class with its own set of rules.
Related: The US has already lost the 2020 crypto regulation race to Europe
Gensler, recently appointed to lead the SEC, has made it clear that he sees the potential and the value in new digital currencies. Recently, he announced that there will be negotiations of some unambiguous regulation for the space that could open the floodgates to billions of dollars in institutional capital. This would be a tremendous development that could stabilize initial public offerings’ day-one pops and swinging Bitcoin prices.
Related: Crypto-friendly faces poised for positions in Biden administration
The U.S. became the leader in the internet movement because, in our wisdom, we allowed e-commerce companies to grow without the burden of sales taxes in state and municipal jurisdictions. This allowed the growth of the industry to the behemoth it is today. Though Al Gore might forever rue the day he ever claimed credit for the U.S. government’s efforts to facilitate national networks and technologies through the High-Performance Computing Act of 1991, the fact is that the U.S. government’s pro-internet policies did help the internet grow as quickly as it did. Marc Andreesen, who created that “Netscape moment” and can claim at least a partial share in helping invent the internet as we know it, has said as much.
Today, the U.S. government finds itself at a similar crossroads. Countries including Switzerland, Singapore, Malta, Panama and other free market-oriented economies have already seen the light, and it’s our collective hope that the powers are willing to see the wisdom in allowing the cryptocurrency industry to thrive. Investor-friendly rules in the U.S. will allow the U.S. to keep its leadership in innovation and technology (please take note, Gensler).
If the U.S. wants to repeat the history of the last 25 years, a history that has seen America reign supreme as the global leader of technology innovation, then it must repeat the ways of its early pro-internet policies, paving the way for the new crypto technology that will break through in the same way as Netscape.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Charles H. Silver is the CEO of Permission.io, a technology provider of permission-based advertising solutions. Charles previously founded RealAge.com, a company that used big data to connect individuals to advertisers on a permission basis. Charles is also co-founder of Reality Shares, an SEC-registered investment adviser with five publicly traded ETFs, and of Blockforce Capital, a multi-strategy cryptocurrency hedge fund. Charles is a graduate of the University of Michigan and a former staff member for a United States Congressman.
Renowned investor Stanley Druckenmiller has shared his views on dogecoin and ethereum. He said he wouldn’t long or short dogecoin and laughs when the meme cryptocurrency rises in value. As for ether, he is skeptical whether it can hold its position.
Stan Druckenmiller on Dogecoin and Ether
In an interview with The Hustle last week, famed investor Stanley Druckenmiller shared his thoughts on bitcoin, ether, and dogecoin, the meme cryptocurrency that has recently taken the market by storm.
Druckenmiller founded Duquesne Capital in 1981. He managed money for George Soros as the lead portfolio manager for the Quantum Fund until 2000. He and Soros made massive profits betting against the British pound in 1992.
The billionaire investor said that dogecoin “is just like NFTs [non-fungible tokens]. It’s a manifestation of the craziest monetary policy in history.” He added: “I think since there’s no limit on supply, I don’t really see the utility of it right now. It’s just this wave of money in the Greater Fool Theory.” Druckenmiller opined:
Now having said that, I wouldn’t short it because I don’t like putting campfires out with my face. So I just try and pretend DOGE doesn’t exist. I think so little of it, it doesn’t even bother me when it goes up.
He continued: “When bitcoin used to go up, I’d go crazy because I didn’t own it. When dogecoin goes up, I just start laughing. Don’t go long and don’t go short. I mean, you know, unless you like going to Vegas, then I guess it’s okay.”
On the subject of bitcoin vs. ethereum, Druckenmiller said, “I think bitcoin has won the store of value game” because it is “a brand, it’s been around for 13-14 years, [and] it has a finite supply.” On whether other cryptocurrencies will replace bitcoin, he reiterated that BTC is “going to be very, very tough to unseat.”
While acknowledging that “the lead in smart contracts and that kind of stuff would be ethereum,” he noted:
I’m a little more skeptical of whether it can hold its position. It reminds me a little of Myspace before Facebook. Or maybe a better analogy is Yahoo before Google came along.
He described, “Google wasn’t that much faster than Yahoo, but it didn’t need to be. All it needed to be was a little bit faster and the rest is history.”
What do you think about Stan Druckenmiller’s views on dogecoin and ether? Let us know in the comments section below.
JPMorgan Chase CEO Jamie Dimon has given personal advice to investors regarding investing in cryptocurrencies, like bitcoin. He said that his own personal advice to people is to “stay away” from cryptocurrencies. However, his bank, JPMorgan, will not stay away as clients want exposure to this asset class.
Jamie Dimon’s Personal Advice to Investors About Bitcoin, Other Cryptocurrencies
Jamie Dimon, the CEO of JPMorgan Chase, the largest bank in the U.S., gave his congressional testimony before the House of Financial Services Committee regarding cryptocurrency on Thursday. While admitting that JPMorgan’s clients are interested in investing in bitcoin, Dimon said:
My own personal advice to people is stay away from it. That does not mean the clients don’t want it. This goes back to how you have to run a business. I don’t smoke marijuana but if you make it nationally legal, I’m not going to stop our people from banking it.
“We are debating should we make it available in some way, in a safe way, that people can buy and sell it” and put it in their financial statements and balance sheets, the JPMorgan CEO continued. “But my own personal view, it’s nothing like a fiat currency. It’s nothing like gold. Buyer beware.”
Dimon clarified that his statements only apply to cryptocurrencies, not blockchains or stablecoins, which are “supported by assets,” he said.
The JPMorgan boss further emphasized that his personal views do not influence the financial services that JPMorgan Chase offers to its clients. “A lot of our clients are asking, ‘can we help them buy or sell cryptocurrency?” Dimon said at JPMorgan Chase’s annual shareholder meeting last week. “And we’re investing in that as we speak.”
The JPMorgan executive further said during his congressional testimony Thursday:
I don’t tell people how to spend their money, regardless of how I might personally feel about something.
Reiterating his view expressed in April that cryptocurrencies are emerging issues that need to be dealt with quickly, Dimon said in his congressional testimony that the crypto asset class could benefit from more regulation.
“I do think that eventually the regulators who are a day late and a dollar short should be paying a lot more attention to the future, like payment for the order flow, a high-frequency trading, cryptocurrency, and put a legal regulatory framework around it,” he opined.
Dimon has long been a bitcoin skeptic. He called the cryptocurrency a fraud back in September 2017. Now JPMorgan is slowly getting into the crypto space. In March, the bank launched a crypto investment product tracking public company stocks with bitcoin exposure. The bank is also reportedly working on providing clients access to bitcoin investments.
JPMorgan recently highlighted three reasons for investing in bitcoin after its analysts predicted that the price of the cryptocurrency could reach $146K as its competition with gold heats up. The firm subsequently lowered its bitcoin price estimate to $130K but said that clients can put 1% of their portfolios in BTC. Last week, JPMorgan initiated coverage of the Coinbase stock with an overweight rating and a 60% upside from the current price.
What do you think about Jamie Dimon’s personal advice to investors about bitcoin and cryptocurrencies? Let us know in the comments section below.
Bank of America, Citigroup, and Wells Fargo have shared their policies regarding cryptocurrency before the U.S. Senate banking committee. The three banks are in different stages of offering crypto services to their clients. They also lag behind some of their peers, such as Morgan Stanley and Goldman Sachs, in offering access to investments with exposure to bitcoin or other cryptocurrencies.
Bank of America Evaluating Crypto Opportunities
The CEOs of Bank of America, Citigroup, and Wells Fargo gave their testimonies on cryptocurrency before the Senate banking committee last week. The committee, headed by Senator Sherrod Brown, summoned the investment bankers for its annual oversight hearing on Wall Street firms.
Bank of America CEO Brian Moynihan said that BofA was keeping distance from bitcoin and other cryptocurrencies as the bank continued “to evaluate the opportunities, risks and client demand for products and services related to cryptocurrency.” Noting that his bank holds more than 60 blockchain-related patents, he emphasized, “We still have not found a use case at scale.” The Bank of America executive confirmed:
Currently, we do not lend against cryptocurrencies and do not bank companies whose primary business is cryptocurrency or the facilitation of cryptocurrency trading and investment.
Bank of America’s analyst said in January that bitcoin was the “mother of all bubbles.” Nonetheless, the bank’s most recent fund manager survey saw “long bitcoin” as the most crowded trade. In March, the bank says the only good reason for holding bitcoin was “sheer price appreciation.”
Senator Brown is skeptical of cryptocurrencies. He recently sent a letter to the new Acting Comptroller of the Currency, Michael Hsu, urging him to review the cryptocurrency regulation under the purview of the Office of the Comptroller of the Currency (OCC).
Citigroup Taking Measured Approach to Crypto
Citigroup CEO Jane Fraser talked about her company taking a “measured approach” to cryptocurrency as the bank sought “to understand changes in the digital asset space and the use of distributed ledger technology, including demand and interest by our clients, regulatory developments and technology advancements.” The Citi executive noted:
Before we engage with cryptocurrencies, we see it as our responsibility to ensure we have clear governance and controls in place.
Citigroup is reportedly planning to launch crypto services as the firm sees a “very rapid” accumulation of interest in bitcoin. In March, Citigroup says bitcoin was at a tipping point and could become the preferred currency for international trade.
Wells Fargo Closely Watching Crypto Space
Wells Fargo CEO Charles Scharf said that his company was close to announcing a pilot project using blockchain technology “to complete internal book transfers of cross-border payments within our global branch network.” However, in terms of cryptocurrency, he said:
We continue to closely and actively follow developments around cryptocurrencies, which have emerged as alternative investments products, though their status as a currency and mechanism of payment remains fluid.
Darrell Cronk, the president of Wells Fargo Investment Institute, said last week that his firm is in the final stages of adding an actively managed cryptocurrency investment strategy to its platform. “We think the cryptocurrency space has just kind of hit an evolution and maturation of its development that allows it now to be a viable investable asset,” the executive opined.
When do you think these three banks will adopt cryptocurrency? Let us know in the comments section below.
The integrations could bring new assets to popular DeFi platforms amid a market-wide pullback.
As digital asset markets suffer a broad pullback, cross-chain bridge protocol Ren has announced integrations with EMV-compatible chains Fantom and Polygon that could bolster liquidity across the DeFi ecosystem.
In a blog post on Friday, Ren announced that the RenVM bridge now supports the trustless transfer of four popular cryptocurrencies to Fantom, including Bitcoin, DOGE, and ZEC. Three additional Fantom bridge assets are incoming as well, including Filecoin and LUNA. Likewise, in a post on Wednesday, Ren announced a similar seven-asset integration with Polygon:
Excited to announce the launch of a direct bridge to Polygon by @renprotocol!
With the Polygon x RenVM Bridge, users can move #BTC and many more assets directly to Polygon, enabling high-speed, low-cost txns for these assets.
— Polygon (previously Matic) (@0xPolygon) May 27, 2021
The Fantom announcement also noted that Ren is “currently working on adding Ren-based assets to Curve, QuickSwap, BadgerDAO, and beyond.” While Ren serves as a bridge between chains, a recent collaboration with BadgerDAO on Ethereum demonstrated that a partnership with a DeFi protocol can drive protocol fees and volume for all parties. In Badger’s case, one-click bridge-and-deposit functionality has driven Badger’s WBTC vault to a quarter billion in TVL.
Per BadgerDAO’s Chris Spadafora, $150 million in BTC has already passed through the joint protocol bridge.
Just crossed $150M in #Bitcoin through the bridge.
Next stop bridging BTC to earn on;@0xPolygon @FantomFDN @solana https://t.co/JcMrGFAFI7
— Spadaboom (@spadaboom1) May 22, 2021
Sidechains like Fantom and Polygon have become increasingly in-demand in recent months as developers, investors, and farmers look for ways to escape Ethereum’s high gas fees. Prior to the recent market slump, EMV-compatible chains played host to implementations of major Ethereum-native DeFi protocols, and sidechain tokens like MATIC have proven to be among the most resilient to the recent bearish price action.
A popular Fantom community account hailed the trustless bridge as the “holy grail” for the chain, noting that the bridge has the potential to significantly bolster total value locked (TVL) metrics for Fantom’s various DeFi protocols, including SushiSwap, Curve, and C.R.E.A.M.
This has been a long time coming. Back in September of last year the $REN bridge was the holy grail for our network. This is a welcome development however and will add to the TVL on $FTM. Which is good for everyone
Great job @renprotocol ! https://t.co/pjlpaHvRps
— Fantom Community Alerts (@FTMAlerts) May 28, 2021
“The addition of Fantom will greatly benefit each protocol by bringing more utility to Fantom and even more velocity through RenVM,” said Ren COO Michael Burgess in a blog post. “We could not be more excited for this to go live, as it’ll help bolster utility for the entire DeFi ecosystem.”
According to analysts from Decentrader, Bitcoin needs to quickly reclaim the $37,500 level and ETH needs to hold $2,300 as support to avoid bull-market-ending price action.
Bitcoin (BTC) price continues to limp lower as traders in the U.S. hit the BBQ to enjoy the upcoming Memorial Day holiday on May 31 and regulated futures and options markets like the CME are closed through the weekend.
Data from Cointelegraph Markets Pro and TradingView shows that after a brief attempt by Bitcoin (BTC) bulls to rally above $37,000 in the early morning hours on May 29, the price has tumbled below $34,000 as the support needed for a move higher failed to manifest.
BTC/USDT 4-hour chart. Source: TradingView
Price action for Ether (ETH) was nearly identical to that of BTC, with an attempt to break above $2,500 met with stiff resistance that pushed the altcoin’s price down to $2,300.
$37,500 or bust
According to analysis from filbfilb, co-founder of Decentrader, Bitcoin’s price action is a major source of the market’s confusion as it remains a ways away from the 20 Week Moving Average (WMA) “which is typically the line between Bitcoin being either in a bull or bear market and as such remains a bearish scenario for Bitcoin.”
Bitcoin 4-hour chart. Source: Decentrader
The analyst went on to further state that if Bitcoin is able to find solid support in the low $30,000s, the 20 WMA could turn into a major resistance zone in any attempt to move higher.
Filbfilb said:
“A drop lower would likely make the low $20,000s or the 78.6% retracement a likely target. As such, price action over the next week is particularly important.”
At this point, according to filbfilb, it is crucial for BTC to reclaim $37,500 “to avoid a retest of weekly support.”
Should Bitcoin manage to stage a rally and break above $40,000, filbfilb identified the previous support/resistance zone at $45,500 to $46,500 as the next area of resistance that will need to be overcome.
Ether draws the line at $2,300
Ether performed slightly better than BTC after it sold off back to the 61.8% retracement as the price was able to bounce back above the 20 WMA, but was ultimately rejected at the “critical pivot price” of $3,000 as the recovery momentum faded.
ETH/USD 4-hour chart. Source: Decentrader
Filbfilb identified $2,300 as an important area of support for Ether that would need to be held if bulls wanted to gather momentum for an attempt to break above the $3,000 level and retest $3,300, with this scenario be highly “dependent upon the strength of Bitcoin.”
Overall, the analyst expects that Ether will outperform BTC in any upside move and “at least match any bearish movement.”
He said,
“For now, eyes are on Bitcoin to see if the lows can be held going into the weekend, with particular attention being around the 200 DMA which is currently the line in the sand for the bulls.”
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Recently, electric vehicle company Tesla announced plans to suspend Bitcoin as a means of payment. The decision represented a sudden reversal, as the firm initially decided to accept the cryptocurrency less than two months earlier.
Tesla Cites Environmental Concerns
Musk’s announcement indicated that Tesla chose to suspend payments due to the fact that Bitcoin mining consumes large amounts of energy.
“We are concerned about rapidly increasing use of fossil fuels for transactions,” Musk’s statement read. “Cryptocurrency is a good idea on many levels, and we believe it has a promising future, but this cannot come at great cost to the environment.”
Markets reacted quickly. After Musk made his announcement on May 12, the price of Bitcoin fell from a high of $57,000 to a low of $34,000. As of Thursday, May 27, Bitcoin has made only a slight recovery; its price currently sits at $38,600.
Despite its negative impact on the market, Musk’s announcement made it clear that the decision was temporary. Tesla intends to use Bitcoin as soon as it “transitions to a more sustainable” energy source, and the firm is looking at BTC alternatives.
Musk Discusses Clean Energy With Miners
On Monday, May 24, Elon Musk revealed that he had spoken with North American Bitcoin miners to coordinate a strategy for clean-energy Bitcoin mining.
Musk wrote on Twitter: “Spoke with North American Bitcoin miners. They committed to publish current & planned renewable usage & to ask miners [worldwide] to do so.”
Microstrategy CEO Michael Saylor added that he had coordinated a meeting between Musk and several North American Bitcoin mining companies. According to Saylor, executives from several companies were in attendance, including Argo Blockchain, Blockcap, Core Scientific, Galaxy Digital, Hive Blockchain, Hut8, and Riot.
Saylor wrote that the mining companies agreed to create a Bitcoin Mining Council, which will “promote energy usage transparency & accelerate sustainability initiatives.”
Musk Considers Dogecoin as Alternative
Musk followed up on that on later dates. On May 13, he indicated that he is “working with Doge devs to improve system transaction efficiency.” Later, developer Ross Nicoll confirmed that Musk is indeed contributing to Dogecoin’s development.
Nicoll drew attention to Musk’s history with PayPal, and stated that the project is taking advice from Musk on payment processing. Nicoll added that he can “honestly say [Musk has] improved [Dogecoin’s] transaction throughput.”
In line with Musk’s own goals, the group also discussed ways to reduce Dogecoin’s energy consumption, which is currently less than 7% of Bitcoin’s footprint.
Musk added that the results are “potentially promising,”
Prior to this, Musk polled his followers on Twitter and asked whether they would support Dogecoin payments at Tesla. Approximately 80% answered in favor.
Cardano and IOTA Solicit Tesla
Since Tesla suspended Bitcoin payments, at least two other notable blockchain projects have attempted to win the attention of Tesla and Elon Musk.
On May 13, Cardano and its creator Charles Hoskinson reached out to Musk, asking him to consider its own ADA cryptocurrency as a Bitcoin replacement. “Are we finally going to have the Cardano conversation? Come to my farm in Longmont,” Hoskinson wrote. Meanwhile, the Cardano Foundation drew attention to its efforts at sustainability.
Cardano is currently the fifth-largest cryptocurrency, boasting a market cap of $5.7 billion, making it a reasonably strong contender as a Bitcoin replacement. However, it does not seem that Musk has responded to Cardano’s invitation.
Elsewhere, on May 12, IOTA co-founder Dominik Schiener suggested that Musk adopt his own cryptocurrency, writing that “IOTA is the answer” to energy concerns.
Once again, Musk did not respond, making it unlikely that Tesla will choose to use IOTA. However, it is worth noting that IOTA has historically focused on automotive partnerships, making the idea of a Tesla partnership not so outlandish. IOTA is currently the 38th largest cryptocurrency, with a market cap of $2.9 billion.
Musk Seeks Marketability, Not Just Efficiency
Musk shone some light on his preferences this week. On May 24, YouTube personality and early Tesla investor Dave Lee asked Musk why he did not choose to use Ethereum 2.0, Cardano, Solana, Polkadot, IOTA, or other similar cryptocurrencies.
Musk responded: “Doge has dogs & memes, whereas the others do not.” It seems that, despite Musk’s insistence on an energy-efficiency, he is taking each coin’s popularity into perspective and does not want to compromise on marketability.
In light of those statements, Dogecoin and Bitcoin are the most likely candidates for Tesla’s next attempt at crypto payments once each coin undergoes a reform.
The Boston-based cryptocurrency finance firm Circle has announced the company has raised $440 million in financing in order to “drive market expansion and growth.” The investment was led by prominent finance firms like Digital Currency Group, Fidelity Management and Research Company, and FTX.
Circle Reveals $440 Million in Financing
Circle Internet Financial, Inc. has revealed the company has obtained $440 million in financing from a number of strategic investors.
Leading investors in Circle include Atlas Merchant Capital, Digital Currency Group, FTX, Breyer Capital, Fidelity Management and Research Company, Marshall Wace, Willett Advisors, Intersection Fintech Ventures, alongside Michael J. Price and Friends.
Circle has attributed a lot of growth to the “rapid rise” of the stablecoin usd coin (USDC). The company considers USDC the “fastest growing dollar digital currency, which now stands at $22 billion in circulation. USDC has grown by 436% in 2021 alone, and over 28,000% over the past 12 months.”
“As a company, Circle has remained committed to our mission of raising global economic prosperity through the power of digital currency, blockchains and breakthroughs in programmable money,” Circle cofounder and CEO, Jeremy Allaire said on Friday.
“The sustained global demand for our services powering the growth of USDC, as the most trusted and well regulated dollar digital currency, signals that we are one step closer to achieving our mission,” Allaire added during the announcement.
Following the financing, two sources familiar with the matter told theblockcrypto.com’s Frank Chaparro the firm is considering a special purpose acquisition vehicle (SPAC) deal.
FTX Exchange has been making a lot of moves in the crypto industry and FTX participated in Circle’s $440 million financing raise as well. “Circle has been an experienced player in making fiat work on blockchains for nearly eight years and has built deep capabilities to ease payments in crypto. At FTX we’re excited to partner further with Circle to help expand these capabilities to all crypto users,” the CEO of FTX Sam Bankman-Fried remarked on Friday.
In addition to the recent financing, Circle has addressed “financial and operational transparency” on May 25, 2021, in regard to USDC circulation.
Circle notes that “USDC in circulation is reviewed by independent accounting firms who could provide reasonable assurance on an ongoing basis that assets held in reserves were at all times able to meet or exceed USDC in circulation. 30 attestations to this effect later issued by Grant Thornton, one of the world’s leading accounting firms, our commitment remains unchanged.”
What do you think about Circle raising $440 million from investors? Let us know what you think about this subject in the comments section below.
On May 27, the president of Bianco Research, Jim Bianco explained during an interview that he believes there’s a lot of upside potential when it comes to the crypto economy. Bianco said since 2017 he’s owned a basket of crypto assets like ethereum, but he doesn’t hold bitcoin.
Bianco Research President Owns a Basket of Digital Coins but Doesn’t Hold Bitcoin
Bianco Research, L.L.C. is a service provider that offers qualitative and quantitative macro investment analysis for the institutional investor. The company’s president and market analyst, Jim Bianco, sat down with the hosts of CNBC’s “Trading Nation” on Wednesday to discuss the crypto economy. Bianco is a believer in digital currencies and has been investing for the last four years, collecting a basket of crypto assets since then.
However, Bianco doesn’t own bitcoin (BTC) and he believes “coins like ethereum are going to be a lot higher way down the road.” Even though this may be the case, Bianco stressed that crypto investors will have to deal with some busts and booms along the way.
“You’re going to have to stomach through much more of what we saw in the last week coming in the next several months or year or so,” Bianco remarked.
The US Will Face ‘Non-Transitory Inflation’ Says Bianco, ‘Cryptocurrencies Show a Lot of Promise’
Bianco has also been a staunch critic of the Federal Reserve’s monetary expansion over the last year and recently opposed Fed Chair Jerome Powell’s “transitory” inflation statement. The Bianco Research executive doesn’t believe it will be temporary and said America will see “non-transitory inflation.” Up until March 9, 2020, Bianco said he was a “bond bull” but quickly reconsidered the optimism after the 10-year Treasury bond dropped to 32 basis points.
As far as cryptocurrencies are concerned, Bianco told the hosts of CNBC’s Trading Nation:
That’s got a lot of promise, and that’s really what’s significant. The problem is the other driver is kind of an out-of-control casino with people betting on these coins going up and down.
The analyst warns, however, that crypto-assets can plunge 50-70% in value because the technology is so new. Nevertheless, after crypto assets fulfill an “adoption phase,” Bianco thinks digital currencies will be a mainstay in the global economy.
“That means from that point forward the gains will be a lot less,” Bianco said. “The risk and the reward is now you’ll have less risk and less reward once it gets adopted and the volatility slows down.”
Furthermore, Bianco noted that crypto assets are showing correlations to other risk assets like equities and gaining exposure to these new assets is key. “That wasn’t the case three or four years ago. But it is the case now,” Bianco concluded during his interview. “If we were to get higher financial market volatility either in the stock market like the VIX index, that could help bolster the cryptocurrency space as a belief, yes, we need a new fix, and this is the fix,” he added.
What do you think about Jim Bianco’s opinion about the crypto economy and his prediction that ethereum will see a lot more upside potential? Let us know what you think about this subject in the comments section below.
PRESS RELEASE. Pandora Finance (https://pandora.finance/) announced that they have successfully closed their $2.4m seed round. The Pandora team received pledges from some of the most visible investors within the crypto space, and closed the round oversubscribed by manifolds.
Overview of strategic investors
The funding round concluded with Pandora selecting some of the most well respected investors within the crypto space. Pandora’s strategic investors include Genesis Block, Spark Digital Assets, AU21, x21, NGC, Zokyo Ventures, Exnetwork, A195, Protocol Ventures, Genblock, Magnus Capital, Chain Asset Capital, Amesten, Crypto Dorm Fund and Master Ventures and accredited individual investors like Danish Chaudhari (Bitcoin.com Exchange) and others.
“GBV has been following the NFT developments closely. In Pandora, we find a unique and innovative solution to bring liquidity to the NFT ecosystem. This represents a major breakthrough in the potential use cases for NFTs!”
— Leslie Tam, Genesis Block Ventures Co-Founder and Partner.
“We are excited to partner with Pandora as they create greater interoperability and liquidity for traditionally illiquid assets, and introduce new exposure opportunities onto the blockchain. Pandora’s clever integration of NFT technology, comprehensive suite of product offerings, and their stellar team position them favorably to succeed in their mission to bridge the divide between digital and physical assets.”
— AU21 (https://au21.capital/)
Overview
Pandora Protocol is a hybrid Open Finance solution for problems faced by both traditional finance, and decentralised finance. By creating a bridge between real-world and on-chain assets, this protocol allows for the tokenization of illiquid assets – meaning they can be found, traded and owned in a secure, decentralized way.
NFTs have been increasingly popular over the last 12 months; however, the lack of liquidity has been a growing concern for many. Pandora’s middleware solution induces liquidity in the NFT ecosystem for any NFT platform; this can come in the form of tokenized real-world assets, through to digital asset NFT’s. Pandora offers significant advantages over other marketplace enablement technologies because instead of competing with other NFT platforms for liquidity, they are helping other platforms grow just by inducing liquidity into them.
It is this technology which sits at the heart of Pandora protocol’s future value. Imagine being able to have a marketplace where both digitally native and real-world assets could find liquidity, accurate pricing while also continually being updated with relevant on-chain data. This would add significant utility and purpose to the NFT space, and allow them to be swapped, traded or borrowed.
What is coming up next for Pandora
Not content with opening up marketplace liquidity to real-world assets, Pandora is currently working on a unique new standard they are naming PiNFT. This hybrid standard, which has the functionality of both fungible and non-fungible tokens, works by wrapping NFTs around something with intrinsic value; such as DAI. This can then be traded on Uniswap, Maker and AAVE – effectively enabling NFT cross-chain trade on a huge number of platforms.
Looking ahead to the remainder of 2021, the Pandora team will be continuing to improve the product and establish even more partnerships to grow the protocol’s effective reach. In the meantime, the team behind Pandora is gearing up for their IDO (Initial DEX Offering).
“We at Pandora are envisioned with bridging the gap between on-chain and real-world assets via NFTs. Our team with driven forces is all geared up to revolutionise the NFT ecosystem by maximising its potential and bringing liquidity to the world of latent illiquid assets”.
– Pushkar Vohra, Founder & CEO – Pandora Finance
About Pandora
Pandora creates a bridge between on-chain and real-world assets to form an open finance ecosystem. This protocol allows for the tokenization of illiquid assets, meaning they can be found, traded, borrowed and owned in a secure, decentralized way. Pandora provides both a middleware solution for minting liquidity enabled NFTs, alongside offering Dapp developers the ability to leverage Pandora to provide liquidity to their own users’ NFTs.
Telegram Official Group: https://t.me/PandoraProtocol
This is a press release. Readers should do their own due diligence before taking any actions related to the promoted company or any of its affiliates or services. Bitcoin.com is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in the press release.
The leading crypto asset bitcoin has seen its value drop more than 53% from its all-time high above the $64k handle, sliding to a low of $30k on May 19. While bitcoin is still down 25% during the last 30 days, it’s hard to forecast where bitcoin’s value is going from here. Although a number of people leverage indicators like the Golden Ratio Multiplier, Fibonacci sequence, logarithmic growth curves, and tools such as the infamous stock-to-flow (S2F) price model to predict future bitcoin valuations.
Predicting Bitcoin’s Booms and Busts With the Number Phi
Most people can’t predict the future and when it comes to bitcoin (BTC) and the crypto economy, in general, as busts and booms are common. Moreover, lots of times busts and booms are unpredictable except for a few occasions like specific news stories that shake investors. However, there’s a plethora of technical analysis tools, charts, and models that help a great number of people get ahead of the game.
For instance, fans of technical analysis leverage the perspective of the golden ratio and Fibonacci sequence in order to predict future bitcoin valuations. Essentially a trader will apply mathematics to things like bitcoin’s value and moving averages. The golden ratio is also known as divine section, divine proportion, the number phi, extreme and mean ratio, and the golden number. Essentially in the “science of quantity,” two quantities reach a mathematical divine section when their ratio is equal to the ratio of their sum to the larger of the two quantities.
The golden ratio is equal to 1.618 and it’s not only used in mathematics, but it also appears in architecture, geometry, and many natural elements. Then there’s the classical example of mathematics called the Fibonacci sequence, which is a sequence of quantities where a number is the addition of the last two quantities, starting with 0, and 1. The Golden Ratio Multiplier hosted on lookintobitcoin.com gives a detailed description of how the multiplier works with the leading crypto asset bitcoin (BTC).
“Bitcoin’s adoption curve and market cycles to understand how price may behave on medium to long term time frames,” the website notes. “To do this it uses multiples of the 350 day moving average (350DMA) of Bitcoin’s price to identify areas of potential resistance to price movements.” Lookintobitcoin.com further adds:
Multiples are of the 350DMA’s price values rather than its number of days. The multiples reference the Golden Ratio (1.6) and the Fibonacci sequence (0, 1, 1, 2, 3, 5, 8, 13, 21). These are important mathematical numbers. These specific multiplications of the 350DMA have been very effective over time at picking out intracycle highs for Bitcoin price and also the major market cycle highs.
The Golden Ratio Multiplier, as it is applied to bitcoin price predictions, was invoked by Philip Swift when he published an article on the subject on June 17, 2019. The article titled: “The Golden Ratio Multiplier: Unlocking the mathematically organic nature of Bitcoin adoption,” helps a trader get more perspective on multi-year cycles.
A 2019 chart of the Golden Ratio Multiplier shared by Philip Swift on Twitter.
“The article starts by noting how the 350-day moving average has acted as an axis for Bitcoin’s major market cycles – once we break out, a new BTC bull run begins,” Swift tweeted two years ago. Swift continued further by saying:
The new insight begins when that important moving average is multiplied by key numbers: the golden ratio (1.618) and numbers in the Fibonacci sequence (1,2,3,5,8,13,21). In doing so we are able to pick out almost all the major intracycle price highs in Bitcoin’s history (coloured lines) AND each market cycle top (dotted lines). See 2015-17 bull run as a clear example of the MA multipliers acting as major resistance at the intracycle highs.
Bitcoin’s Numerical Sequence Like Fibonacci Poetry and Nautilus Shells
Of course, not everyone agrees with using the golden ratio and the Fibonacci sequence to predict bitcoin busts and booms. For instance, Alvaro Fernández from the open insurance platform Nsure Network remarked: “Historically it seemed to be respected, but how much could you trust it? We might as well pass through the first accumulation high.” Other critics believe using the golden ratio and the Fibonacci sequence is no different than using tarot cards.
Despite the skeptics, Swift’s bitcoin tool the Golden Ratio Multiplier is well respected and used by a myriad of technical analysts. The golden ratio has been utilized since the time of the ancient Greeks and many believe it’s deeply associated with the universe and nature. Similar to the golden ratio, Satoshi Nakamoto’s invention is a renowned and irrational technology by design. Interestingly, bitcoin’s epic price rise since it was first traded has followed the number phi and Fibonacci sequence patterns intimately.
In the same way as the Golden Ratio Multiplier, the leading asset has followed succinctly with a “natural long-term power-law corridor of growth,” according to Harold Christopher Burger. Burger published a comprehensive article that discusses bitcoin’s logarithmic growth curves. Like Swift’s Golden Ratio Multiplier, logarithmic growth curves can also give a trader an idea of when they can expect busts and booms and specific time frames. But these tools have allegedly been debunked on occasion and the golden ratio is often considered a fairytale.
Similar to the Nautilus shell, bitcoin’s price has often been associated with the golden mean and Fibonacci sequence. The Nautilus shell is often compared and associated with the golden ratio, but contrarian research and further considerations say that the famous shell shape is not a good example of the golden ratio logarithmic spiral found in nature. Studies show the Nautilus shell has phi proportions but follows a 4:3 ratio.
What do you think about using the golden ratio and Fibonacci sequence to predict future bitcoin prices? Let us know what you think about this subject in the comments section below.
Bearish signals are growing in the crypto markets as tighter regulations and environmental concerns cast a dark shadow over Bitcoin.
Coming every Saturday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.
Top Stories This Week
Bearish signals grow as Bitcoin price drops to $35,000 and traders ignore the dip
Bitcoin is struggling right now. The cryptocurrency has struggled to keep its head above $40,000 this week as traders react negatively to twin threats of environmental concerns and the growing drumbeat of regulation.
We’ve seen a lot of downside moves across the market over the past two weeks. Although most institutional investors have held firm and vowed to continue holding onto their crypto, there’s been a lack of “we bought the dip” announcements. All of this has left retail traders worrying that BTC could suffer further declines.
The Crypto Fear and Greed Index is currently flashing a score of 18, indicating that Extreme Fear is currently paralyzing the market.
Bitcoin can still drop to $20,000 but holding remains winning strategy, data shows
Yes, there are some rather dire warnings out there, but Bitcoin’s 11-year history does help offer an insight into how the world’s biggest cryptocurrency fares when things turn bearish.
The BTC/USD exchange rate typically rises parabolically. It later trims more than half of those gains down as profitable traders sell the top. But, at the same time, traders who buy Bitcoin around its local top suffer longer periods of losses.
Overall, the historic price trajectory of Bitcoin remains skewed to the upside. The cryptocurrency bottoms out after every bullish-to-bearish cycle and rebounds all over again to seek new all-time highs.
PlanB, the creator of the stock-to-flow model that predicts BTC will hit $288,000 by 2024, recently delivered this powerful fact: Not a single investor who has held Bitcoin for more than four years has ever suffered losses.
Shutting down Bitcoin is impossible, Ark Investment founder says
With China imposing a crypto crackdown, the Biden administration reviewing “gaps” in the regulation of digital assets, Iran banning BTC mining until September to preserve electricity, and Australia warning that traders who don’t report crypto profits will face consequences, regulation is certainly stepping up a gear.
But when it comes to whether Bitcoin itself is in danger of being shut down, Ark Investment founder Cathie Wood believes this would be “impossible.”
At CoinDesk’s Consensus 2021 conference, she predicted global regulators “will be a little more friendly over time” toward cryptocurrencies due to the fear of missing out on opportunities provided by the industry.
With miners now willing to prioritize renewable sources of energy for BTC mining, Wood said: “Half of the solution is understanding the problem.”
Michael Saylor says Bitcoin Mining Council required to combat “hostile” narrative
According to MicroStrategy CEO Michael Saylor, part of this quest to understand the problem involves the creation of the Bitcoin Mining Council.
This organization, announced on May 25, was formed following a successful meeting between Elon Musk and a number of top North American mining firms.
During the Consensus 2021 conference, Saylor said: “It turns out that Bitcoin miners don’t actually have a good forum for communicating how they generate their energy. We don’t have a standard model for Bitcoin energy usage right now, and we don’t have a future forecast model that we commonly use.”
Castle Island Ventures’ Nic Carter certainly is a fan of making things more transparent, but he believes Elon Musk isn’t the right person to lead this debate.
He explained: “Bitcoiners are still intensely skeptical of Musk, and they view him as conflicted, given that his business partially involves the sale of offsets.”
PayPal users will be able to withdraw crypto to external wallets
There were some promising developments on the adoption front this week. PayPal announced that it will allow users to withdraw digital assets to third-party wallets.
Meanwhile, Apple has revealed that it is looking for a new business development manager who specializes in alternative payments, including cryptocurrency — signaling that the iPhone manufacturer is gravitating toward digital assets.
While the job posting is compelling, Apple remains largely on the sidelines of the cryptocurrency industry and has yet to signal definitive plans for expanding into this market. Interestingly, cryptocurrency exchange Coinbase recently overtook TikTok as the most downloaded app on Apple’s App Store.
Winners and Losers
At the end of the week, Bitcoin is at $36,514.09, Ether at $2,515.33 and XRP at $0.90. The total market cap is at $1,589,854,165,444.
Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Helium, BakeryToken and Polygon. The top three altcoin losers of the week are Waves, Solana and UNUS SED LEO.
For more info on crypto prices, make sure to read Cointelegraph’s market analysis.
Most Memorable Quotations
“I believe Bitcoin has a long way to fall from here. I think it will slowly grind down the slope of hope with a periodic dead cat bounce. Bitcoin’s technicals are severely damaged, it is better to be the first one to sell into the bubble before the whole ship sinks.”
BiotechValley Insights
“It turns out that Bitcoin miners don’t actually have a good forum for communicating how they generate their energy. We don’t have a standard model for Bitcoin energy usage right now, and we don’t have a future forecast model that we commonly use.”
Michael Saylor, MicroStrategy CEO
“Spoke with North American Bitcoin miners. They committed to publish current & planned renewable usage & to ask miners WW to do so. Potentially promising.”
Elon Musk, Tesla CEO
“No-coiners are taking this opportunity to buy the dip.”
Willy Woo, statistician
Prediction of the Week
Bitcoin price volatility hits 2021 high as one analyst paints $15,000 target
BTC’s 30-day volatility is at a yearly high, suggesting that the flagship cryptocurrency remains at risk of wild price fluctuations in the sessions ahead.
Things are even crazier when it comes to Ether. Data from Skew suggests ETH/USD’s realized volatility on a 30-day timeframe is now near 2017 highs.
One dire prediction this week came from an analyst at BiotechValley Insights, who said: “I believe Bitcoin has a long way to fall from here. I think it will slowly grind down the slope of hope with a periodic dead cat bounce.”
Their current price target? $15,000 to $16,000.
FUD of the Week
SEC charges five for illegally prompting $2 billion Bitconnect Ponzi
Three years and some unforgettable memes later, the United States Securities and Exchange Commission has announced that five individuals will face charges relating to promoting the Bitconnect Ponzi scheme.
The promoters are accused of offering and selling securities without registering with the offering with the SEC and validating themselves as broker-dealers — in violation of the law.
They also allegedly “advertised the merits of investing in BitConnect’s lending program to prospective investors, including by creating ‘testimonial’ style videos and publishing them on YouTube, sometimes multiple times a day.”
The SEC’s Lara Shalov Mehraban said: “We will seek to hold accountable those who illegally profit by capitalizing on the public’s interest in digital assets.”
U.K. regulator bans crypto exchange’s ‘time to buy’ Bitcoin advert
Britain’s advertising regulator has banned an ad campaign that told people “it’s time to buy” Bitcoin.
Luno’s posters had caused quite a splash earlier this year, and were plastered across the London Underground transit network and on buses. One ad said: “If you’re seeing Bitcoin on the Underground, it’s time to buy.”
However, the Advertising Standards Authority concluded that the campaign failed to illustrate the risk of investing in BTC. It said: “We considered that consumers would interpret the statement ‘it’s time to buy’ as a call to action and that the simplicity of the statement gave the impression that Bitcoin investment was straightforward and accessible.”
Future adverts will need to carry a proper risk warning.
China to socially blacklist Bitcoin miners in Inner Mongolia region
New penalties are introduced to try and deter people from mining Bitcoin in Inner Mongolia.
Reports suggest offenders will now be placed on a social credit blacklist — something that would stop them from being able to access loans or even use the local transport network.
The new rules make particular mention of data centers, industrial parks, telecoms companies, internet firms and even cybercafes, noting that any such offenders found operating mining equipment would have their business license revoked, could be removed from the local electricity trading scheme, and could even have their businesses shut down entirely.
China’s determination to rid itself of Bitcoin miners has already had a knock-on effect. Three mining companies — BTC.TOP, Huobi and HashCow — announced they were closing down their operations in the Chinese mainland earlier this week.
Best Cointelegraph Features
Carbon-neutral Bitcoin funds gain traction as investors seek greener crypto
Steps are being taken to ensure green Bitcoin options for investors, but this may only serve as a short-term solution to a long-term problem.
For the long haul? When Bitcoin nosedived, institutions held fast
Institutional investors know crypto assets are volatile: “They’re making a generational bet and are not deterred by a few weeks of volatility.”
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