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Crypto Guru Mike Novogratz Warns Bitcoin Tied to Fate of Equities – For Now

Despite its growing reputation as an uncorrelated hedge, Bitcoin advocate and Galaxy Digital CEO Mike Novogratz says Bitcoin remains linked with the movements of the macro economy. The CEO, who accurately predicted that Bitcoin would cross $20,000 by the end of 2020, speaks with CNBC Squawkbox about Bitcoin’s correlation with the equities market. When asked […]

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Despite its growing reputation as an uncorrelated hedge, Bitcoin advocate and Galaxy Digital CEO Mike Novogratz says Bitcoin remains linked with the movements of the macro economy.

The CEO, who accurately predicted that Bitcoin would cross $20,000 by the end of 2020, speaks with CNBC Squawkbox about Bitcoin’s correlation with the equities market.

When asked what he anticipates will happen if the current speculative bubble bursts, Novogratz says he fully expects Bitcoin to take a plunge with the rest of the equities market.

“If the speculative bubble bursts Bitcoin will go down for a while. There’s too much correlation between people with risk assets, right. If you made a ton of money here and you’re losing a ton of money here, at one point you’re going to take some profits where you’ve made money. And so if the S&P was down 20% in the next three days Bitcoin would be lower not higher.”

Despite this correlation, Novogratz believes that Bitcoin will mature into an asset that is less affected by significant dips in the equities market as a growing number of millenials and gen z’ers  look to BTC as a hedge against economic uncertainty.

“There is an adoption cycle going on with institutions wanting to buy this because it’s really hard to see a way out for the central banks and for governments. It’s really hard to see a way out for this giant deficit that we continue to grow and it’s growing at an accelerating rate.

It’s why millennials and gen z intuitively are buying Bitcoin cause they know they’re kind of screwed. The baby boomers have eaten all their future lunches in lots of ways by building these giant deficits and so I do think Bitcoin is going to stay correlated to risk assets in the short run, but that correlation breaks down over time and it’s going to continue to go [down] as more people are getting into this community.”

Novogratz highlights the viral nature of Bitcoin’s story, attempting to prepare viewers for what he sees as an imminent onslaught of institutional interest Bitcoin.

“The viral nature of how many people are getting into bitcoin can’t be underestimated. It’s shocking to me how many institutions are now lining up to try and get Bitcoin into their portfolios.”

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

Source: https://dailyhodl.com/2021/01/08/crypto-guru-mike-novogratz-warns-bitcoin-tied-to-fate-of-equities-for-now/

Blockchain

The DeFi Sector Has Grown By 89% In Six Months

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The DeFi Sector Has Grown By 89% In Six Months

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The total value locked (TVL) in decentralized smart contracts which averaged $2.5 billion on July 15, 2020, has increased by 89% in six months to the current TVL of $23.2 billion, according to data from leading on-chain DeFi metrics site DeFiPulse.

Decentralized Finance (DeFi) is a fast-growing sector of the crypto market and represents about 2% of the total $1.04 trillion market cap. DeFiPulse provides data across different types of decentralized applications including lending dApps, derivative services dApps, payment dApps, assets dApps, and decentralized exchanges (DEXES).

At the top position, Ethereum-based Maker has $4.26 billion in TVL, followed by Aave, Uniswap, Compound, Synthetix, and Curve Finance with TVLs of $2.99 billion, $2.78 billion, 2.73 billion, 2.33 billion, and 1.98 billion, respectively.

In the last three months, Maker, Aave, and Compound alone were responsible for adding $6.32 billion in TVL to the DeFi sector. As the leading dApps development platform, Ethereum is the mother of all decentralized applications at the moment, even with growing competition from other blockchain ecosystems like Cardano, EOS, Polkadot, and Tron.

DeFi Sector Will Grow Exponentially

DeFi is disrupting traditional finance and forcing governments and traditional financial institutions to take notice of how people are moving liquidity in and out of peer-to-peer financial platforms.

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DeFi applications are at an early stage of development as is evident on the high level of technical know-how that’s required to participate safely and navigate different dApp environments. However, the high level of innovativeness and practicality of existing and upcoming DeFi dApps has played a big role in both the advancement of crypto regulations and investor-interest in the crypto market.

Most notably, Stablecoins, which are the most popular digital assets in many DeFi dApps can now be held in federal savings associations and national banks after they received a green light from the US Comptroller of Currency (OCC).

According to DeFiPulse, the high rate of growth in the DeFi Sector is capable of growing by a further 9% to $25 billion by the end of the week.

ETH-based dApps vs ETH 2.0

The majority of the best performing DeFi DApps are based on Ethereum which is in the middle of a huge transition from Proof-of-Work to Proof-of-Stake consensus protocol, among other upgrades.

The transition will affect all the ETH-based DApps and eventually, their performance will be based on the success of the full implementation of Ethereum upgrades which will occur in phases.

Such dApps have a choice to continue operating on ETH 1.0 but they will have to migrate to Ethereum 2.0 in the end, due to issues such as scalability and governance mechanisms. Synthetix, the most popular derivatives liquidity protocol in DeFi has already published its optimistic migration plan to ETH 2.0. 


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DISCLAIMER Read More

The views expressed in the article are wholly those of the author and do not represent those of, nor should they be attributed to, ZyCrypto. This article is not meant to give financial advice. Please carry out your own research before investing in any of the various cryptocurrencies available.

Source: https://zycrypto.com/the-defi-sector-has-grown-by-89-in-six-months/

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Blockchain

Miami Mayor Considers Investing In Bitcoin With Part Of City’s Treasury Reserves

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Miami Mayor Considers Investing In Bitcoin With Part Of City's Treasury Reserves

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Bitcoin has continued to gain individual investors’ attention; institutions, even government officeholders, seem not to be left out.

The top cryptocurrency by market cap, dubbed the decade’s best investment, has got many people regretting why they didn’t get into bitcoin much earlier. The mayor of Miami seems to be in this category.

In a recent interview with FOX Business on January 14, 2021, Miami Mayor Francis Suarez made his intentions known, saying he’s considering diversifying some of the city’s current investment portfolio, putting a percentage of it into Bitcoin.

In his own words;

“We are looking at the possibility of diversifying our investment portfolio and holding a percentage of our investment in Bitcoin.”

“I would have done it last year, I would have made 200% plus. So I would have looked like a genius.”

Mayor Suarez aims to make Miami a crypto-friendly city, making the city the easiest place to execute crypto transactions in the United States.

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“So we are looking at a variety of things from being able to make payments in crypto, in Bitcoin, in particular, being able to pay your taxes, being able to pay fees to the city.”

Bitcoin’s limited supply is cited as to why the mayor thinks investing in Bitcoin is a great investment opportunity. He believes bitcoin’s price will only continue to appreciate in value because of this feature.

More U.S. Government Position Holders Declare Allegiance To Bitcoin

Though the United States is one of the countries with stringent cryptocurrency policies that have forced many crypto-related establishments out of the country, more and more government office holders are openly declaring their support for Bitcoin.

Aside from Mayor Suarez, United States representative for Minnesota, another Pro cryptocurrency and decentralization public office holder is Congressman Tom Emmer.

Tom Emmer believes bitcoin and blockchain are going nowhere but will instead continue to become more important as it advances.


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DISCLAIMER Read More

The views expressed in the article are wholly those of the author and do not represent those of, nor should they be attributed to, ZyCrypto. This article is not meant to give financial advice. Please carry out your own research before investing in any of the various cryptocurrencies available.

Source: https://zycrypto.com/miami-mayor-considers-investing-in-bitcoin-with-part-of-citys-treasury-reserves/

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Blockchain

$1 billion worth SNX transferred for $7 in gas fees

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According to reports from Etherscan, a whopping $1 billion was transferred on the Ethereum blockchain for only $7 in gas fees.

This transfer, which was perhaps one of the largest transactions observed on the Ethereum blockchain, consisted of 74.5 million SNX tokens migrating to the new Reward Escrow V2 contract- an action that is reportedly required in order to enable escrowed SNX to be migrated to OVM L2.

The announcement from Synthetix confirmed that the new escrow contract is now live, as per SIP-60 and the recent Castor release.

The protocol stated that “SNX stakers with escrowed SNX will need to migrate to the new contract before they can claim staking rewards or vest any escrowed SNX.”

According to Synthetix, the current SNX RewardEscrow contract is limited to only allowing the FeePool to escrow SNX rewards from the inflationary supply. “It was not designed to be used as a general purpose escrow contract.”, stated the protocol in a document explaining the limitations observed in the current ‘RewardsEscrow’contract.

These limitations include the fact that the contract only escrows SNX for a period of 12 months and that only FeePool has the authority to create escrow entries.

The new ‘SythentixEscrow’ contract will allow the ability to add arbitrary escrow periods, for instance – 3 months to 2 years, and enable public escrowing.

SNX Founder Kain Warwick outlined a number of potential challenges for users to be aware of as SNX transitions to Layer 2, in a blog post yesterday. He said,

“With this change, we are trying to maintain a balance between risk to L1 and maintaining a coherent system across both layers.”

Warwick further went on to highlight that,

“This conflict is fundamentally incompatible, so we have opted for initiating the transition with the absolute minimum risk to L1, and then adding functionality over the course of the next few months as we build confidence in Optimistic Ethereum”.

Source: https://eng.ambcrypto.com/1-billion-worth-snx-transferred-for-7-in-gas-fees

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