Bitcoin is in the red today, following yesterday evening’s announcement of President-elect Joe Biden’s $1.9 trillion stimulus plan.
The bitcoin exchange-traded product (ETP) from ETC Group (recently launched on Switzerland’s SIX stock exchange, though it trades elsewhere) has seen volumes far above all the other 1,800 ETPs listed on Deutsche Börse, the exchange said. Meanwhile, Bitwise found the number of financial advisers allocating crypto to client portfolios rose 49% year over year, according to a survey of 900 money managers.
Coinbase crowdsources coins
The popular exchange announced the Asset Hub yesterday, a new issuance portal that would allow users to nominate a cryptocurrency to trade on the exchange. “We appreciate that the growth of the cryptoeconomy depends on the success of digital asset issuers, and we are committed to supporting issuers every way we can,” an executive said.
Blockchain mortgage platform Figure says it has closed a $100 million financing facility for its mortgage products from JPMorgan. The firm also reported its mortgage business grew nearly 50% month over month in the fourth-quarter of 2020. Coinbase’s venture arm has invested in the mining company Titan’s seed round, while merchant bank Galaxy Digital will start mining bitcoin and offering financial services for miners.
- BITCOIN CORE: Bitcoin got an upgrade. Here’s what you need to know. (CoinDesk)
- PRIVACY COINS: A number of exchanges have swepts dash, zcash and monero from their order books. At least one won’t disclose why. (CoinDesk)
- CFTC INSIDER: What the crypto world can expect from Gary Gensler at the SEC. (CoinDesk op-ed)
- BIDEN’S $1T: Does Biden’s stimulus plan vindicate bitcoiners? (First Mover/CoinDesk)
- $1B TRANSFER: It only cost $7 to move a large order on Ethereum. (Decrypt)
- ‘HIGH PRIORITY’: Jerome Powell says the Fed is working on stablecoin risks. (The Block)
- THE EFFECT: Does Grayscale Trust affect crypto prices? (Medium)
- NEW ERA: Of government-friendly bitcoin miners. (Vice)
As prices for bitcoin and other cryptocurrencies continue to surge this year, many traders are looking for any indicator for when – or if – the bull market will come to an end. Some are convinced they have the answer: They are examining polkadot (DOT), the native token of the Polkadot blockchain, as a potential canary in the coal mine for cryptocurrency. CoinDesk’s Muyao Shen covers the market maneuver.
It’s been a while since we last covered Tether here, but a recent headline related to the bank where the stablecoin issuer parks its funds is as good a reason as any to check in. In a year-end video recording sent to its customers, and recently surfaced in the crypto media, Deltec Bank & Trust Chief Investment Officer Hugo Rogers said it was investing some client funds in bitcoin.
According to the video (which I haven’t personally seen), Rogers said the bank bought bitcoin before its latest run-up, at about $9,300. “[S]o that worked very well through 2020 and we expect it to continue working well in 2021 as the printing presses continue to run hot,” Rogers said in the video. The money machines go brrr.
Apart from the revelation that an investment officer at a Bahamian bank is a bitcoin bull, the quote did raise questions about Tether’s reserves. Tether (USDT) is a U.S. dollar-pegged stablecoin. It’s issuer, Tether, a company that shares executives with the Bitfinex crypto exchange, is said to maintain the stablecoin’s one-to-one relationship with the greenback based on cash or cash equivalents held by Deltec.
Deltec has clarified that Roger’s statements “had no relation whatsoever to Tether’s depositary assets with Deltec.” So Tether’s reserves are definitely not backed by bitcoin. Or at least not bitcoin that investment officers at Deltec had begun purchasing in Q4 2020.
So what is backing tether?
There are now more than $24 billion in tether in existence, approximately a fivefold increase from the beginning of 2020, when there were fewer than 5 billion tethers. In theory, there should be approximately $24 billion in tether reserves parked in the Bahamian bank.
While many vouch for the company and coin, Tether has yet to produce a full audit of its reserves. In 2019, Bitfinex and Tether told the New York courts tether is only backed 74% by cash and short-term securities rather than maintaining a complete peg, though months later they walked back that claim.
In short, no one outside of Tether can be entirely sure what’s backing the popular stablecoin. Tether isn’t decentralized like other cryptocurrencies, nor does it have a hard cap to the amount that can be created.
Now the third-largest crypto by market cap, tether is likely the most trafficked crypto in terms of trade volume. It’s used not only as a legitimate means of payment (CoinDesk reported it’s frequently used to skirt sanctions in China and Russia), but also as a common trading pair and a place for investors to park their money during periods of market volatility.
“Tether’s growth in 2020 has been spectacular. We are now starting to speak of the Tetherization of trading, with the lion’s share of spot trading volume now denominated in tether (USDT) tokens,” Chief Technology Officer at Bitfinex and Tether Paolo Ardoino told CoinDesk over email through a spokesperson in December. “As commercial activity rises, so does the use of tether,” he continued.
As Ardoino suggests, the amount of tether is based purely on demand for the preeminent stablecoin. The company mints tethers based on orders from exchanges, traders and others, though because of its limited know-your-customer rules it’s not always obvious who is calling to turn on the mint.
Some of these questions might soon be answered. As part of an ongoing lawsuit pursued by the New York Attorney General, Bitfinex and Tether face a Jan. 15 deadline to provide millions of pages of documents related to a loan Tether allegedly provided to Bitfinex to cover an $850 million hole.
Who won #CryptoTwitter?
All Eyes on Ethereum
One Ether now costs more than US$3000. Did you ever think you’d see the day?
You gotta hand it to the crypto markets: in some ways they’re comically predictable. A month ago, Ethereum was everyone’s favourite whipping boy, a bloated, expensive under-achiever that couldn’t even double its 2017 all-time high. Lol what a weakling.
And with competitors like Cosmos, Solana, Polygon and Polkadot nipping at its heels, perhaps this was the beginning of the end for the network that gave us smart contracts, ICOs, ERC-20 tokens, DeFi, yield farming, NFTs and, to be honest, the entire idea that blockchain was a multi-functional and era-shaping technological breakthrough that you ignored at your peril.
How things have changed. On Monday Ethereum blasted through the US$3000 mark like it was barely there, throwing on an extra 15% while it was at it. The network is now worth a shade under US$400 billion, putting it on par with Mastercard and Walmart, and officially making Vitalik Buterin, the 27-year-old prodigy who created Ethereum, a bona fide billionaire. So, is this how the Flippening begins?
Network to net worth
Due to the speed with which things move in crypto, we tend to underestimate some of the metrics that actually speak to a technology’s success. The new shiny thing is almost always more exciting than some dusty old contraption built in the positively prehistoric year of 2015. Did they even have electricity back then?
But Ethereum stands out from almost all other blockchains in that it’s already being used, at scale, by millions of people and companies. While that may seem like Business 101 – get more customers, be more successful – when it comes to blockchain usage is a particularly powerful factor because of the way it harnesses network effects to improve the value of the system itself. Use it more and the whole system becomes more valuable, both financially and practically, for the network’s users, miners, stakers, investors and developers. Oh, and Vitalik, of course.
How far we’ve come
Ethereum’s issue has always been its inability to scale. If you can’t handle hundreds or even thousands of transactions a second, then you’re not really fit for purpose as a global computer. The result for Ethereum has been a year of increasing network congestion and brutally high transaction fees. Yet the fact that so much continues to be built and transacted on Ethereum tells you exactly how strong these network effects already are.
There’s also an increasing focus on three major changes to the Ethereum network due to arrive before the end of the year:
- EIP-1559: Lifts one of DeFi’s major innovations in the field of ‘tokenomics’ by implementing a token burn system on every transaction. You use the Ethereum network, you burn some ETH, never to be seen again.
- Optimism: due for a full launch in July, the Optimism sidechain should significantly improve the speed of Ethereum by leveraging largely incomprehensible processes such as ZK-Rollups and Sharding. It’s already being used by the Synthetix protocol, where it has saved users over $10 million dollars in transaction fees.
- Ethereum 2.0: This is the big one, Ethereum’s transition from Proof-of-Work to Proof-of-Stake. It’s been coming for years, but the importance of the change cannot be overstated. Already more than 4 million Ethereum are being staked on the Ethereum 2.0 contract, offering an insight into how much ETH might fall out of circulation once the entire thing goes live (potentially in November).
In short, Ethereum is just getting started. The price might seem gaspingly high right now, but remember that Ethereum isn’t trying to be Walmart or Mastercard. It wants to be the thing that Walmart and Mastercard are built on – and that’s a prospect worth having a stake in.
CARBON: A perfect avenue for showcasing talent
Creative professionals sometimes find themselves figuring out where to showcase their creations and profit from them.
It’s a tough situation to be in. But with CARBON, the dilemma is lessened.
CARBON creates an avenue that gives creators both a place to show off their talents and a chance to earn money.
CARBON features an ecosystem of a global scale that integrates open finance, fashion, art, music, and non-fungible tokens (NFTs).
One of its objectives is to enable a community that can inspire, support, and reward professionals.
What the CARBON marketplace looks like
As what an ideal marketplace should be, CARBON has a lot to offer, helping emerging brands and artists have a shot even at the highest levels of competition they have to deal with.
Items related to fashion, art pieces, music, and digital assets such as NFTs are offered in the CARBON marketplace. A dedicated team will carefully select these products.
The market will also see exclusive collaborations featuring various artists and brands for physical commodities and digital items that will be dropped on a weekly basis.
As for its audience, they should prepare for a diverse experience brought by a market evolving into a global ecosystem.
CARBON was founded by Chad Pickard who also acts as its Chief Executive Officer (CEO). It is an open finance wallet and super ecosystem that is built for the whole world of fashion, art, music, and culture while also integrating digital assets through NFT offerings.
It has its native token, the $GEMS, and its wallet integrates Neobank functions like the financial technology company Revolut and a non-custodial smart wallet for decentralized finance (DeFi) and cryptocurrencies.
This integration allows users to hold fiat (government-backed) and digital currencies as well as NFTs in a single platform.
The wallet is linked to the market, giving users the ability to directly select items that they desire.
CARBON doesn’t just work as a marketplace where purchases can be made, but also as an avenue where professional creators get to showcase their talents and inspire others to promote their own. It provides them with a winning environment.
How Tokenplace can help crypto traders get the best buy and sell prices
Any seasoned crypto trader knows that the price of a digital currency can vary across different exchanges worldwide.
Thus, one of the basic strategies for investing in digital currencies is to scout for the best buy or sell price and that’s where Tokenplace comes in.
Access to different crypto exchanges via one platform
To take full advantage of the price variance across exchanges, some traders often resort to opening accounts on different platforms. But Tokenplace eliminates this need because the platform allows one to access different exchanges worldwide.
This means that a user will only need his Tokenplace account and password to gain access to the entire crypto market. This is a lot simpler compared to having to main multiple accounts and passwords for other exchanges for different trading pairs.
Tokenplace is basically an online trading platform and exchange aggregator. With its automated order-splitting, orders are automatically broken up to ensure that traders get the best price for every coin they want to trade.
Easy to use and features-packed trading terminal
Tokenplace is also very appealing to newer investors because it is very easy to use. For instance, users will only need to access a single window for their deposits, withdrawals, trading, and exchanging.
The platform can be accessed from both desktop and mobile devices. Tokenplace’s onboarding and one-time registration process are also one of the quickest in the industry.
Tokenplace uses advanced algorithms for its multi-exchange order splitting feature. With this high-tech tool, users can get the best buy and sell price every time they trade.
IMPORTANT NOTE: This is a paid press release, which BitcoinerX has posted as part of a commercial agreement. BitcoinerX is not responsible for producing this content and does not endorse the products or services mentioned. It is the responsibility of the company posting the press release to ensure the material is credible and accurate. BitcoinerX is not responsible for any damage or loss caused to anyone who chooses to use the company, product or services mentioned in the press release. BitcoinerX does not recommend using the information in the press release to form the sole basis of investment decisions.
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