THIS WEEK IN CRYPTO
- Polygon announced that it has launched its "Plonky2" technology and set new speed and scalability records for a Layer 2 Ethereum blockchain. The group claims it can now verify complex transactions like Ethereum smart contracts, which would absolutely be a breakthrough. MATIC jumped as much as 16.4% in the last 24 hours and is up 15.4% over that time. Read more here.
- Politicians want to ban Central Bank Digital Currencies. US Congressman Tom Emmer put forward legislation to outlaw the Federal Reserve from creating and distributing a central bank digital currency. Emmer’s main issue with the current CBDC proposals is that they will likely lead to a lack of innovation and an increase in financial surveillance capabilities. Read more here.
- Visa joins Mastercard to test Central Bank Digital Currencies. Visa will begin piloting a program this spring with ConsenSys Inc., a blockchain software company, after discussions with roughly 30 central banks about goals related to government-backed digital currencies. Cuy Sheffield, Visa’s head of crypto, says they believe that stablecoins and CBDCs will coexist in the future and there’ll be a number of different approaches to creating products based on that.
- TransUnion brings credit data checks to Crypto lending. The Credit-reporting firm will let consumers give blockchain companies access through Spring Labs’ ky0x Digital Passport. Consumers will be able to receive better interest rates when borrowing money from financial-services companies that operate on public blockchains such as Ethereum by providing this information, the companies said.
- Gemini pushes into wealth management with the acquisition of BITRIA. The Crypto exchange has agreed to purchase BITRIA, a five-year-old San Francisco-based start-up whose tools help advisors manage holdings of bitcoin and other tokens. Gemini intends to combine its crypto custody and exchange capabilities with BITRIA’s portfolio management programs, allowing advisors to do things like tax-loss harvesting. Read more here.
- Turks pile into Bitcoin and Tether to escape plunging Lira. Turks are particularly enamored of the stablecoin tether, whose value is pegged to the dollar. The lira this fall became the most traded government-issued currency against tether, outpacing the dollar and the euro, according to CryptoCompare. Shops selling bitcoin have cropped up in the Grand Bazaar near where traders also sell foreign currency and gold. Read more here.
WHAT TO WATCH
- First Web3 ETF is on the way and its ticker will be ‘WIII’. In the latest iteration of money managers capitalizing on all things crypto, Simplify Asset Management filed an application to launch Simplify Volt Web3 ETF. ‘WIII’ will invest up to 10% of its total assets in the Grayscale Bitcoin Trust (GBTC) and will also be utilizing an options strategy to hedge against risks. It carries a management fee of 0.95%. Read more here.
- Coinbase plans to buy Derivatives Exchange FairX. The acquisition of FairX, which already is registered with the Commodity Futures Trading Commission, fills a void in Coinbase’s product lineup. Coinbase said the acquisition would allow it to first bring regulated crypto derivatives to market through FairX’s existing partner ecosystem, and then expand to all U.S. Coinbase customers.
- Fed interest rate hikes this year could put Dogecoin and Shiba Inu returns in the doghouse, says Motley Fool’s Tor Constantino. As borrowing gets more expensive and corporate profits to get squeezed due to rate hikes, risk-averse investors are likely to move funds to safe-haven investments such as adjustable bonds. An exodus from highly speculative assets such as Dogecoin and Shiba Inu could dramatically hurt those cryptos.
- Crypto exchanges eye traditional investment offers. FTX US and Bitstamp Ltd are exploring offering equities trading in the US, a move that’d allow them to diversify while venturing into the territory of traditional financial firms and popular app providers such as Robinhood Markets Inc. FTX US is working on adding stock and options trading while Bitstamp is also considering entering new markets such as equities, NFTs, and crypto derivatives.
Read more here.
- Bitcoin could rise to $75,000 this year to top record high, says Guido Buehler, CEO of Swiss bank Seba. The CEO said his firm’s models see bitcoin rising to between $50,000 and $75,000 in 2022. Buehler said he thinks institutional investors will help to boost the price of bitcoin in 2022 and are looking for the right time to get in. He said they also have asset pools that are looking for the right times to invest.