Displaying items by tag: bitcoin

Biden’s administration has been an outspoken critic of crypto currency and these words now have actions behind them. Biden has signed an executive order to have various government agencies put forth a plan to regulate crypto. The admin is most concerned about consumer protection, national security, and illicit finance. Additionally the explosion in popularity in the industry and the wide array of digital assets is cause for concern because the admin is worried it might be getting out of hand. However, Biden makes it clear they want to maintain an American leadership position when it comes to the growing area of fintech. The director of the National Economic Council and the security advisor see this as a pathway forward to maintaining a leading role in digital assets and the fintech ecosystem.

Finsum: Crypto needs stable regulation; weekly threats coming from global leaders are bad. If this is on that path it's probably a good thing for crypto.

Bitcoin has stumbled as of late, all the way down to $46,000, but Goldman Sachs isn’t backing off their bullishness and they say the price may double to over $100,000 by the end of 2023. The first of the primary reasons is just the groundswell into digital assets generally. The second big factor is how investors will fundamentally see bitcoin moving forward, as a store of value substitute. They see bitcoin eating away at a stalling gold bouillon. To date, bitcoin only makes up a fifth of the ‘store of value’ market, but that could swing all the way up to a market majority. Other cryptos could also jump in to take some of the markets as well.

FINSUM: As Fed uncertainty lingers, investors are going to push themselves more into alternatives to hedge inflation and interest uncertainty and maintain a store of value.

Traditional crypto dominates headlines, and while regulations are an inevitability in the U.S.; stable coins are getting some attention from regulators as well. Stable coins are cryptos pegged predominantly the U.S. dollar, using assets like T-bills to back them as an underlying asset. They are used to trade other crypto currencies by many investors and have yields bringing in over 7%. However, the underlying assets backing stable coins are opaque and include commercial paper, loans, or swaps. The Biden admin is calling on Congress, and the Treasury if they fail to act, to regulate the industry because the fear of a run on stable coins is gowing. However, Wall Street views these regulations as a positive for the industry and legitimize stable coins. Mastercard, Visa, Western Union, Silvergate Capital and Signature bank could all benefit given how much they interact with stable coins.

FINSUM: Regulation is the best thing for stable coins, they get so many overseas investors who want hold dollar denominated assets, and this will calm fears of a run on the asset.

Bitcoin is the most polarizing alternative investment by a wide margin and some say the slowing is natural, and the bull run is far from over. However, world leaders are singing a different tune. Swiss Bank Chair Alex Webber was the latest figure to speak out against the digital currency. While he showed appreciation for the underlying tech he said there was no chance that they would survive to upend the global payments structure. This was unwelcome commentary from bitcoin investors who saw prices fall severely in the last week. Additionally, China has targeted bitcoin again with shadow regulation and is the key driver in the price movements.

FINSUM: The biggest threat to bitcoin will always be regulation, particularly because its largest value as an asset class is currency conversion, particularly from developing nations.

Earlier today, the first U.S. bitcoin ETF — the ProShares Bitcoin Strategy ETF (ticker: BITO) — began trading on the New York Stock Exchange...see the full story on our partner's site