This week top 5 articles 📌
The biggest Bitcoin conference in the world is taking place this week in Miami while the market recovers and more institutions lean into digital assets. This week, leading financial players re-evaluate Bitcoin’s relationship to traditional assets while digital national currencies progress.
Institutions look at Bitcoin as digital gold
Fidelity’s digital assets president, Tom Jessop, suggests that institutional investors eye Bitcoin as a hedge against inflation and a safe-haven asset like gold.
Jessop highlights that clients are looking for hedges against fiscal/monetary stimulus and monetary inflation, while Bitcoin’s scarcity makes it a top alternative. Even though Bitcoin shows a lack of correlation to other assets, confirming the hedge narrative, some investors also highlight its “network effects” as one of its value propositions.
Could Bitcoin be digital copper? Is Bitcoin’s relationship to precious metals in question?
Bitcoin could resemble copper more than gold, according to the Chief of Commodities at Goldman Sachs, Jeff Currie.
As we’ve seen, institutions look at bitcoin as digital gold, but Jeff Currie now hints that Bitcoin’s risk profile resembles copper “as it is definitely a risk-on asset.”
Investors use these assets in bull markets to gain superior alpha while looking at risk-off assets/safe havens like gold in down markets.
Ethereum could power Central Bank Digital Currencies.
China Securities Regulatory Commission’s member, Yao Qian, suggested that Central Bank Digital Currencies (CBDCs) as the digital yuan or the digital dollar could run on the Ethereum network.
At a conference in a panel about “Digital Currency and the Future Digital Transformation,” Qian believes CBDCs should bolster the innovation in the crypto sector and move towards “smart money.”Qian’s main point on the use of Ethereum is to better serve citizens by using a platform that requires no intermediaries while helping underbanked communities.
Crypto mining goes from farms to the desktop.
Mining operations usually require high upfront costs due to equipment needs, while running expenses such as electricity make it hard for individual players to set up profitable operations. On top of operational costs, the security aspects also come into play. To solve those problems, NortonLifeLock is opening a new feature to allow a small set of customers to mine Ethereum on their desktops, cutting the costs of setting such an operation. The company plans to add other leading digital assets that offer the “highest reward for their computing capacity.”
Stablecoins reach record market capitalizations. What are they?
Decrypt delves into the concept of stablecoins and their use cases in the market while focusing on its biggest player - Tether (USDT). Stablecoins are digital currencies usually pegged to the value of a traditional currency. Tether’s USDT value derives from the US dollar while offering an easy way to retain value in the crypto ecosystem without converting crypto to FIAT. Tether and other stablecoins offer many more opportunities besides their price stability, such as generating passive income or gaining more liquidity by collateralizing your stablecoins.
To be the first to get the latest news on Sygnum and the market, expert insights and industry research please follow us on Linkedin and Twitter.
This document is purely for educational purposes and has been issued by Sygnum Group. It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a marketing communication. It does not constitute an offer or a recommendation to subscribe, purchase, sell or hold any security or financial instrument. It contains the opinions of Sygnum Group, as at the date of issue. These opinions and the information contained herein do not take into account an individual‘s specific circumstances, objectives, or needs. No representation is made that any investment or strategy is suitable or appropriate to individual circumstances or that any investment or strategy constitutes personalized investment advice to any investor. Therefore, you must verify the above and all other information provided in the document or otherwise review it with your external advisors. Some investment products and services, including custody, may be subject to legal restrictions or may not be available worldwide on an unrestricted basis. The information and analysis contained herein are based on sources considered as reliable. Sygnum Group uses its best efforts to ensure the timeliness, accuracy, and comprehensiveness of the information contained in this document. Nevertheless, all information indicated herein may change without notice.