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VC blockchain and crypto funding rises in Q4 2023: Report

By Susana | 19 February, 2024 | Comments 0 Comment

The growing interest of financial institutions in crypto is attributed to the launch of the first spot Bitcoin ETFs in January, according to a report from PitchBook.

Venture funding for crypto-related companies totalled $1.9 billion in the fourth quarter of 2023 — a 2.5% increase from the third quarter — according to a report from PitchBook. It marks the first-time venture capital (VC) investments in crypto startups have risen since March 2022.

PitchBook highlighted that the major crypto ventures securing funding primarily center around financial and technological solutions. These include tokenizing real-world assets on the blockchain, such as real estate and stocks, and building decentralized computing infrastructure.

Some prominent fundraises in the quarter involved crypto exchanges Swan Bitcoin and Blockchain.com, which secured $165 million and $100 million, respectively.

Screenshot of crypto early-stage VC deals in Q4 2023.
Source: PitchBook

The most significant deal of the quarter involved a $225 million investment in Wormhole, an open-source blockchain development platform. Supported by Coinbase Ventures, Jump Trading and ParaFi Capital, the company acquired a valuation of $2.5 billion.

The increased interest in crypto from financial institutions can be attributed to the launch of the first spot Bitcoin exchange-traded funds (ETFs) in the United States in January, according to PitchBook’s report.

In the first quarter of 2023, crypto firms secured $2.6 billion in 353 investment rounds, according to PitchBook’s Q1 Crypto Report. The report showed an 11% decline in deal value from the previous quarter and a 12.2% decrease in total deals. Furthermore, the quarter marked the lowest capital investment in the space since 2020.

The crypto industry faced challenges in 2022, with market difficulties reflected in reduced venture capital funding for blockchain and crypto sectors. Following the peak at $11 billion and 692 deals in the initial four months of 2022, VC investment steadily declined in subsequent quarters.

Various factors led to decreased crypto and blockchain-related VC funding in 2022, including the collapse of the Terra ecosystem in May 2022, resulting in the bankruptcy of cryptocurrency lending firms Three Arrows Capital and Celsius.

The FTX collapse in November 2022 intensified market volatility, and broader global economic factors, such as increased interest rates and inflation, also contributed to the decline in venture capital investments.

In 2023, the crypto industry saw a turnaround, with stories of adoption worldwide and major TradFi institutions like BlackRock entering the crypto space.

Source: Cointelegraph

Disclaimer: The information set out herein should not be taken as financial advice or investment recommendations. All investments and trading involve risk and it is the responsibility of each individual to do their due diligence before making any investment decision.

CryptoBoom with EurocoinPay, Token City and Stabolut

By Susana | 18 January, 2024 | Comments 0 Comment

In this article we leave you the link to the TV programme Nación Innovación, presented by Chema Nieto and dedicated to boosting the innovative ecosystem, which was broadcast live on 15 January 2024 at 14:00.

The programme featured Herminio Fernández (CEO of EurocoinPay), Eneko Knörr (Co-founder of Stabolut) and Rocío Álvarez (Partner & CMO at Token City) and the main topic was the current situation of bitcoin and cryptocurrencies.

Source: Nación Innovación

Bitcoin turns 15, will the price skyrocket with ETFs?

By Susana | 10 January, 2024 | Comments 0 Comment

The SEC will have “no choice” but to approve the Bitcoin ETF and the decision will be known in a few days. What will this mean for the price of the asset?

A highly volatile asset, it has seen sharp rises and dizzying falls. Now, investors are awaiting the approval of an ETF to invest in this type of asset. Bitcoin is 15 years old, what can we expect now from this asset and will the price skyrocket with ETFs? We take a closer look at the outlook with Herminio Fernández, CEO of EurocoinPay.

Interview | Bitcoin, perspectives after 15 years.
We talked about it with Herminio Fernández, CEO of EurocoinPay.

In a few days, we could have a decision from the SEC on the approval of an exchange-traded fund, an ETF, of Bitcoin.

A countdown that is bringing all kinds of speculation. Some even point out that the SEC is backed into a corner to give the green light.

The expert believes that, in effect, the SEC will have no choice but to approve this fund, because all the specifications requested by the regulator have been submitted.

A “yes” to these ETFs would mark a before and after for the cryptocurrency. But “I think it already has a very important upward momentum, for all that Bitcoin represents”.

Physical Bitcoin

Now, if this approval is given, all investment funds and platforms that want to offer these ETFs will have to go to the market to buy physical Bitcoin. They must be backed not by listed securities, but by real Bitcoin.

If there are 20-30% of Bitcoin in circulation now, because most of them are in wallets, it means that those that are available to buy are scarce.

There may be significant buying pressure, which will push prices up. “It would turn Bitcoin into a very bullish market”.

Source: Capital Radio

Enforcing MiCA, halving and new ETFs: the outlook for cryptocurrencies in 2024

By Susana | 3 January, 2024 | Comments 0 Comment

Traders are optimistic that the implementation of the world’s first regulation, the European MiCA, will lead to a wider acceptance of cryptocurrencies among institutions and banks.

It has not been an easy year for the cryptocurrency industry, and yet the figures are very positive. The total market capitalisation of digital currencies has risen by more than 138%, representing an increase of more than $870 billion in capital over the previous year, and bitcoin has accumulated an annual increase of 152.53%. With exceptions, such as ether and Binance’s cryptocurrency, which are up 91.95% and 25.69% respectively, the rest of the digital currencies have appreciated by more than 150% in 2023. The ranking is topped by far by solana, which is up 937.55% year-on-year. 2023 has been the year of recovery: the FTX debacle in November 2022 was still felt in the first half of the year, especially with the collapse of Signature Bank. And 2024 is the year of consolidation. The industry is optimistic about the implementation of the world’s first regulation, the European MiCA, which will lead to greater acceptance among institutions and banks.

From left to right, from top to bottom: Almudena de la Mata, founder of Blockchain Intelligence; Javier García de la Torre, director of Binance Spain and Portugal; Víctor Ronco, cryptocurrency expert; Ángel Luis Quesada, CEO of Onyze; Manuel Villegas, Next Generation Research Analyst at Julius Baer; Selva Orejón, professor at EAE Business School; Leif Ferreira, co-founder and CEO of Bit2Me; Simon Peters, expert cryptoasset analyst at eToro; and **Herminio Fernández**, **CEO of EurocoinPay**.

Binance Spain and Portugal director Javier Garcia de la Torre sums up the general sentiment as follows: “Looking ahead to 2024, the outlook for cryptocurrencies is subject to a number of factors, such as regulatory developments, technological advances and market confidence.” Without a stable regulatory framework, it does not improve the reputation of assets that are still reeling from FTX and frauds that have gone around the world. The European Union took a giant step forward with MiCA, the first regulation to secure bitcoin and e-money token transfers, paving the way for regulation in the world’s major economies. “In Europe, the approval of the MiCA regulation has created an environment of greater legal certainty,” explains Almudena de la Mata, founder of Blockchain Intelligence, “traditional banks are working on models to offer custody and trading services to their customers. And with them, the use of cryptoassets is spreading and normalising.

It is precisely the banks that will have the future of cryptocurrencies in their hands. “It won’t be long before we see how anyone can open a bitcoin account at a bank and deposit their assets there, delegating the trust of the assets they have held until now to the bank,” says Ángel Luis Quesada, CEO of Onyze. It is a chain reaction of regulatory implementation in EU member states: if there is support from regulators, there will also be support from the banking industry, which will see a new business window in cryptocurrency accounts. “MiCA will be the starting pistol for banks, where little by little in the following years almost all banks in the world will offer bitcoin to their customers,” says Leif Ferreira, co-founder and CEO of Bit2Me. Thus, he adds, will come “mass retail adoption”.

The advent of ETFs

After establishing a regulatory framework, the next step is institutional acceptance. In recent months, the crypto environment has been reinvigorated by news of the possible creation of a bitcoin spot price ETF. The market has seen around 12 applications for bitcoin spot price ETFs, some from large asset managers such as BlackRock, Fidelity, Wisdom Tree and Invesco. Blackrock, for example, has acknowledged “strong demand for bitcoin” from its clients. “A spot bitcoin ETF offers investors the possibility of investing in bitcoin without these managers actually holding the currency, as it is held by investment funds, thus avoiding the challenges of storage and security,” says Herminio Fernández, CEO of EurocoinPay. It would be an attractive product both for institutional investors due to its low costs and regulatory advantages and for individual investors who have so far avoided including bitcoin in their portfolios due to the difficulty of working directly with blockchains.

10 January 2024 is the deadline for the US Securities and Exchange Commission (SEC) to decide whether to approve or reject the bitcoin exchange-traded fund application filed jointly by Ark Invest and 21 Shares, while deadlines for other applications expire around March. That said, if the first ETF is approved, “it will happen as a whole, as many of the products share the same characteristics, and the SEC should not favour any one,” says Manuel Villegas, next generation research analyst at Julius Baer. For the moment, the winds are blowing in our favour. According to Reuters, the SEC has reportedly been meeting frequently with BlackRock, Grayscale, Fidelity and Invesco on this issue and at least two of these managers were instructed by the regulator to file final changes to their form by 29 December.

It should be recalled that the SEC was notable this year for its tougher tone against cryptocurrencies and the actions taken against some of the best-known exchange platforms in the sector, such as Coinbase and Binance. In this regard, EAE Business School professor Selva Orejón stresses the need for companies in this industry to focus on “building a solid reputation, addressing public concerns and highlighting their efforts in security and regulatory compliance“, hence transparency and effective communication are “essential”.

Halving’, the formula to boost the price of bitcoin

The cryptoasset market faces 2024 with a special expectation: bitcoin halving. Every four years, bitcoin halves the reward for each block mined. This event, known as halving, stipulates that for every 210,000 blocks added to the blockchain (roughly every four years), the reward to miners and the amount of new bitcoins put into circulation is cut by 50%. “The token economics governing this blockchain is based on there being a total of 21 million bitcoins mined, with a decreasing supply or new issuance of assets,” explains Simon Peters, cryptoasset analyst at eToro.

The supply shock comes from halving, due in April 2024, which “will cause the reward per block to drop from 6.25 bitcoins to 3.125 bitcoins and bitcoin’s own annual inflation rate from around 1.7% to around 0.85%”. Traditionally, this decrease in supply, coupled with demand, usually translates into an increase in the price of the reigning cryptocurrency. “As bitcoin has about half the market capitalisation of the total market, this usually triggers a new bull cycle for the entire industry,” assumes cryptocurrency expert Victor Ronco.

Source: elPeriódicodeEspaña/activos

Which sectors accept cryptocurrencies as a form of payment?

By Susana | 9 November, 2023 | Comments 0 Comment

A new study by crypto-tax software CoinLedger revealed that the retail and e-commerce sector has the highest number of companies offering the option to buy via cryptocurrencies.

The study compiled a list of more than 300 large companies known to accept cryptocurrency methods and categorised them into industries, to discover which contains the most companies offering cryptocurrencies as a payment method.

Retail and e-commerce ranked first, with a total of 60 companies accepting cryptocurrency payments. The sector includes clothing and accessories retailers such as Adidas, Yankee Candle and H&M, as well as online shopping platforms such as Etsy.

Second on the list is the Food & Dining sector with 54 companies. Examples include Chipotle, Chuck E Cheese’s, Domino’s and Hard Rock Café, and delivery services such as DoorDash and Uber Eats. Gradually, different services are becoming available in different countries: Burger King Venezuela has been accepting Bitcoin payments since 2020.

Luxury retail comes in third place, with 35 companies offering the service, including high fashion brands Gucci and Ralph Lauren, luxury watch retailer Hublot, as well as jewellers such as Jewelry Affairs and CRM Jewelers.

Further down the list, Travel & Hospitality ranks fourth, with 31 companies accepting crypto payments. They range from commercial airlines, such as Norwegian Air and Vueling, to private jet charters, such as Fast Private Jet, LunaJets and PrivateFly.

Cruise lines Royal Caribbean and Princess Cruises are also on the list, as well as travel organisation help sites such as GetYourGuide.

The top five close with Internet and Online Services companies, as 28 accept cryptocurrency as a payment method. These companies offer a service available to use online on our phones and laptops, such as Google Play and Spotify, and various VPN services such as CyberGhostVPN, ExpressVPN and FrootVPN.

Top 10 industries offering cryptocurrencies as a payment method:

David Kemmerer, co-founder and CEO of CoinLedger, commented on the findings.

“The growing number of businesses accepting cryptocurrency payments reflects the growing acceptance and adoption of digital currencies in the mainstream economy. This trend not only aligns with the changing preferences of tech-savvy consumers, but also offers benefits such as reduced transaction fees and increased security. From large retailers to small businesses, the diversification of sectors adopting cryptocurrencies demonstrates the versatility and potential of blockchain technology. As this trend continues, it is likely to contribute to greater acceptance of cryptocurrencies as a legitimate form of payment, paving the way for a more decentralised and accessible financial landscape.”

At EurocoinPay we have always been committed to a better world and we have expressed our firm intention to contribute to a change in the economy, where the financial transactions we make in our daily lives are faster, safer and more transparent.

Our cryptocurrency payment gateway for Ecommerce provides the solution for all those businesses and companies that want to offer the option of paying their products or services to customers through cryptocurrencies quickly and easily.

It accepts payments with cryptocurrencies through EurocoinPay.

BECOME A CRYPTOCOMMERCE!!

Source: Cointelegraph

Technology: past, present and future

By Susana | 25 August, 2023 | Comments 0 Comment

Technology has come a long way in the last two decades. Some devices that were in use in the late 20th century and early 2000s are now outdated.

In general, the technological products of the past focused on a few functions that they did well, and today’s innovations focus on offering more possibilities.

For example, older mobiles or “dumb phones” were only good for making calls, sending SMS and, at most, playing fairly simple games. Today, smartphones can do everything.

Pagers, also known as pagers or ‘pagers‘, were telecommunications devices that received short messages and coexisted with analogue mobile phones. Today they have been replaced by apps on smartphones.

In entertainment, items such as VHS, vinyl, cassette tapes and video games have also been replaced by free and subscription-based entertainment apps for smartphones and other devices.

If we make a compilation of these developments, we can find technological products that did not exist two decades ago and that we can hardly live without right now:

Multimedia Content
Free or subscription-based entertainment platforms to watch, share and download music, podcasts, films, series, documentaries…

Social Networking
Platforms that serve to connect people from different parts of the world and is used to share information, news, multimedia content, 24-hour stories and reels.

Instant messaging
Instant messaging applications for smartphones that allow you to chat, send photos/videos and make video calls with friends or family.

High-definition televisionsSmart TVs have a place in our living rooms to enjoy series and films in high quality.

E-Commerce
Who would have thought that we would end up shopping online without leaving home?

Mobile phones
They have gradually taken up a space in our lives and have become an essential device in our daily lives.

Tablet
The perfect device to move from side to side thanks to its size.

Google Drive
Allows users to store files in the cloud, synchronise them between devices and share them.

Google Maps
It’s the perfect application for getting from one place to another thanks to its directions.

Wireless Headphones
The problem of tangled headphone wires is a thing of the past with wireless headphones nowadays.

An app forevery service in your life
There are apps for monitoring your health, exercising, buying clothes online, listening to music, meeting people, among online, listen to music, meet people, among others.

Smart watches
They provide health information, offer workouts, display the time and date, can be linked to a mobile phone and some are able to respond to calls or messages.

Internet
It is the mainstay of our lives when we are connected to the net.

In short, the great revolution we have seen in the last decade is that of mobile devices, in which we have gone from being able to do three things to having everything at our fingertips.

New technologies of the future

The new technologies of the future are living with us in our present. The technological changes that have taken place in recent years have revolutionised various sectors, from the productive to the domestic.

The future is not predicted, but created with today’s technologies. The technologies that are creating that future are Blockchain technology, smart contracts, cryptocurrencies, web 3, artificial intelligence (AI)…

A few years ago we imagined a future full of holograms, robots with their own identity, hyperconnectivity and houses controlled by voice commands… and so it has happened! And so it has happened! In fact, it has probably happened faster than we expected.

We are in a constant acceleration of innovation and technology where we must be prepared and walk in that direction. Are you ready?

The new technologies of the future are living with us in our present. The technological changes that have taken place in the last few years have revolutionised various sectors, from the productive to the domestic. The future starts NOW.

Sources: 20minutos.es, 20minutos.es, rtve.es, enzyme.biz

Barcelona to host Europe’s largest blockchain event from 24-26 October

By Susana | 10 August, 2023 | Comments 0 Comment

Barcelona will host Europe’s leading blockchain conference from 24 October. Introduced in 2018, the European Blockchain Convention connects industry experts, technology leaders and startups. Discussions will explore the massive potential of cryptocurrencies and blockchain.

Meanwhile, the Catalan capital will host the largest blockchain event in Europe since the convention began, with approximately 5,000 delegates.

The buzz of cryptocurrencies in Barcelona

The blockchain event will see Barcelona dominate crypto events during the last weekend of October. In addition to industry professionals flocking to the EBC9 event, the gathering coincides with the much-watched El Clasico tournament between Real Madrid and Barcelona.

The European Blockchain Convention will include C-level executives from Anomoca Brands, Fabric Ventures, Fidelity and Nansen. Speakers from traditional firms such as Volkswagen and Banco will also attend. In addition, representatives from Galaxy Digital and Binance Labs will be in the house.

Organising the massive blockchain evento

Organisers have selected a larger venue, Fira Barcelona, following a substantial increase in participant interest after the previous edition. The new location offers enough space for exhibitors, more engagements and a wide variety of content, according to European Blockchain Convention co-founder Victoria Gago.

Co-founder Daniel Salmeron expressed his enthusiasm for connecting web3, digital assets and TradFi, stating that the participation of multiple financial institutions indicates their optimism and dedication to the future of finance.

Agendas in focus

The ninth edition of the ECB will address several agendas, including the institutionalisation of cryptocurrency, AI, tokenisation, DeFi, privacy, CBDC and sustainability.

In addition to workshop panels and discussions, the programme incorporates a 3,000 square metre area for exhibitors and sponsors. In addition, speakers will conduct AMA sessions. Other events include ECB start-up awards, art galleries and investor meetings.

In addition, the list of side events will feature more than 200 hackers, 20 teams and more than 30 mentors participating in a 2-day hackathon. More details, including ticketing, can be found on the official website: https://eblockchainconvention.com/

Source: invezz.com

Brazil and Spain are in the top 20 countries with the highest number of bitcoin users

By Susana | 21 July, 2023 | Comments 0 Comment

According to CoinMarketCap statistics, Brazilians are among the most interested in cryptocurrencies so far in 2023.

The United States continues to lead in the ranking of users accessing the CoinMarketCap.
Bitcoin is more popular in Europe than in South America.

Brazil is in the top 20 countries with the highest adoption of cryptocurrencies globally, according to the results of an analysis published by CoinMarketCap, one of the leading websites for accessing cryptocurrency market information.

The report presented by CoinMarketCap Research, places the South American giant in fifth place among the countries with the highest levels of cryptocurrency users who accessed the platform during the first half of 2023.

It is also worth noting that Brazil is the only country in Latin America to be ranked among the top 20 in the study. A position that highlights the high level of adoption present in the country and which has been ratified in similar research.

In this regard, a Bitget survey recently revealed that 32% of Brazilians spend up to 15% of their income investing in cryptocurrencies. A higher investment figure than has been identified in countries such as Argentina and Mexico, explains the study.

Precisely because of the magnitude of this market, the Brazilian government passed a law to regulate the use of cryptocurrencies, as reported by CriptoNoticias.

Spain is also in the top 20 in terms of traffic on CoinMarketCap. The Iberian country is in 14th place in the ranking, with 2.92% of the platform’s users.

Within this group of countries, the United States dominates the distribution of cryptocurrency users worldwide, with 17% of traffic. Of the rest, the vast majority of users come from European countries.

Users in the United States are the most interested in bitcoin. Source: CoinMarketCap.

Interest in bitcoin surged in the second quarter of 2023

The report also reports on user preferences for different types of cryptocurrencies, with bitcoin (BTC) attracting the most attention.

The pioneering cryptocurrency “remains the most watched in all regions in the first half of 2023, a similar trend to Q4 2022, which is also reflected in BTC’s dominance over altcoins,” the study notes.

Thus, it reports a 25% increase in attention on bitcoin over the course of the last six months, rising from 40% at the beginning of the year to 50.3% at the end of June. An advance that is attributed to events such as BlackRock’s ETF filing and the upcoming bitcoin halving expected in March 2024.

And although in most regions of the world people prefer bitcoin over other cryptocurrencies, in terms of taste, Europe stands out, where interest is 52%. This percentage contrasts somewhat with what is happening in South America, the area with the lowest percentage of interest in BTC (39%) and the highest interest in Baby Doge Coin or BabyDoge (21.7%), an altcoin based on dog memes.

Regarding ether (Ethereum’s ETH) the study indicates that it “remains a popular currency of interest in most regions, except Asia and Africa”. It is also stated that Ethereum scaling solutions such as Polygon (MATIC) and Arbitrum (ARB) gained mainly attention in South America.

Source: criptonoticias

Is Bitcoin decoupling from the rest of the cryptomarket?

By Susana | 7 July, 2023 | Comments 0 Comment

Excluding the Ethereum merger, Bitcoin’s correlation with Ethereum is at its lowest point since 2021
Bitcoin’s dominance over the entire cryptomarket rose steadily in 2023, now at a 2-year high
Numbers say BTC could delink, regulatory crackdown changes crypto trading patterns

In recent years, it has been a fair statement to declare that most cryptocurrencies are traded as leveraged bets on Bitcoin. The world’s largest cryptocurrency goes up in value, altcoins go up some more. Bitcoin falls, altcoins fall some more. As generalisations go, it is reasonably fair.

However, within this general pattern, there have been periods when this relationship has deviated from the norm. One such moment is now, when some of the underlying numbers seem to imply that Bitcoin may be decoupling from the rest of the market.

First, the most obvious way to investigate this is to plot the correlation between Bitcoin and the second largest cryptocurrency, Ethereum. The chart below shows that the normally super-high correlation has fallen to its second weakest mark in the last eighteen months, behind only September 2022, when the Ethereum merger was executed.

Ether / Bitcoin Correlation

Pearson 60-Day Correlation Coefficient

Source: @DanniiAshmore, Invezz

The Ethereum merger last September was not only an Ethereum-specific event, but the correlation almost immediately returned to normal levels. If we discount this event, you would have to go back to 2021 to see the correlation between Bitcoin and Ethereum as low as it is today. Of course, it is still not exactly “weak” at 0.7, quite the opposite, but it is remarkable in the context of the historical relationship, where the average has been a near-perfect 0.9 since early 2022.

The graph shows that the correlation starts to decline around April. The next chart shows this in a different way, depicting the performance since early 2022 of Bitcoin and Ethereum. The two assets move at roughly the same time, but you can see a slight divergence emerging around April this year.

Bitcoin & Ether, Returns Since 01-Jan-2022

Source: @DanniiAshmore, Invezz

By the way, the reason I am taking the sample space from the beginning of 2022 is not strictly for a nice round number. This was when the stock market peaked and represents a transition to a new paradigm for financial markets. While interest rates only started to rise in March 2022, inflation was rising, confidence was falling and concern was close at hand, exacerbated by Russia’s invasion of Ukraine in February and the unleashing of an energy crisis. In other words, the pandemic party, also known as zero interest season, was over. It represents a structural break in the macro climate and financial markets in general.

Bitcoin went down, along with other risky assets, as rates continued to rise. But, now we ask: are we at another inflection point for Bitcoin? Why is Bitcoin’s relationship with Ethereum weakening?

Is Bitcoin carving out its own niche?

This weakening relationship has more to do with Bitcoin than Ethereum. In the chart below, we see the oft-referenced Bitcoin dominance chart, which plots the market capitalisation of Bitcoin against the market capitalisation of the entire cryptocurrency sector.

The chart shows that it has increased considerably since the beginning of 2023, jumping from 41% to 51%. That means that 51% of the total crypto market capitalisation is made up of Bitcoin, the highest mark in two years.

What is interesting is that, traditionally (if we can use that phrase in an industry that is barely a decade old), Bitcoin’s dominance falls in times of rising cryptocurrency prices. In general, Bitcoin jumps higher, before money flows into altcoins with the falling dominance ratio. This time, that is not happening.

Again, why? The answer may lie in regulation and the fact that the market increasingly sees Bitcoin as an asset that is carving out its own niche. For many cryptoheads (myself included), this has long been a point of contention. In terms of fundamentals, Bitcoin and Ethereum don’t really have much in common, except for the fact that they both run on something called the blockchain (and those two blockchains, as of the merger in September 2022, are completely different beasts).

But my point is redundant. However, the letter of the law is not; more importantly, it seems that US regulators are beginning to take the same view. As Coinbase CEO Brian Armstrong lamented after his exchange was slapped with a lawsuit last month:

We got this information from the SEC that, well, actually anything that’s not Bitcoin is a security. And we said to ourselves, well, that’s not our understanding of the law.
Brian Armstrong, CEO of Coinbase

Coinbase can complain all it wants (and it will have its day in court), but the reality for the market is that this is happening, whether it is fair or not, and it may affect the way price action in crypto moves from now on. The SEC even formally described several cryptocurrencies that it formally considered securities, including Solana, BNB and the native tokens for Cardano and Polygon. Tracing the correlation between Bitcoin and a pair of these assets as an example, the breakout is clear in June, as the market sells off in response to the confirmation of securities.

Bitcoin Correlations

Rolling 60-Day Pearson vs ADA & SOL
ADA & SOL named as securities by SEC on June 5^th

Source: @DanniiAshmore, Invezz

Of course, this is a stronger sell-off and a bigger drop in correlation than what we saw previously with Ether. The world’s second largest cryptocurrency seems to be operating in a grey area, which perhaps explains why the sell-off has not been as large as, for example, ADA and SOL, but also why it is not on par with Bitcoin.

Spot ETF applications paint a brighter picture for Bitcoin

Then there is the case of spot ETF applications, coming from a handful of the world’s largest asset managers. These are Bitcoin ETFs, not Ethereum or crypto ETFs. While approval would be a boon for the cryptocurrency sector in general, as it could open the door to similar vehicles for other assets in the future, the many hurdles Bitcoin has had to evade to remain in the ETF discussion are numerous. There is still no guarantee that these ETFs will be approved; certainly, other assets seem a long way off. Therefore, the simultaneous SEC security-driven crackdown and the plethora of Bitcoin ETF applications is driving a wedge between Bitcoin and other cryptocurrencies.

The million-dollar question is whether this all goes back to normal once the furore subsides. There is no doubt that the relationship remains strong here and Bitcoin continues to lead the market. But there may also be reason to believe that there has been a structural break and that the previous hand-holding relationship will not be so close in the future.

Crypto has had a rough patch recently. The 2022 scandals were plentiful (Terra, Celsius, FTX, to name a few) and capital flight has been staggering, as (for whatever reason) investors have chosen that Treasury bills paying 5% are preferable to centralised cryptocurrencies paying -100% (hopefully -90% after many years of bankruptcy court proceedings).

While Bitcoin has also been immensely affected by the pain of 2022, its first mover advantage and lack of counterparty risk could help it avoid being tainted by the same tainted brush in the eyes of e-commerce investors. Altcoins are definitely not fashionable at the moment, and the reputation of the non-Bitcoin crypto sector has been greatly tarnished in the eyes of institutional capital.

The great Bitcoin decoupling, which would be Bitcoin cutting its correlation with risky assets and instead claiming the status of an uncorrelated store of value, seems a long way off yet. But a lesser type of decoupling, where it separates itself from other cryptocurrencies, may not be as far away as previously thought.

Once again, the numbers could immediately return to normal. Perhaps it is just a hint of what may come at some point down the road. But either way, it is one of the most crucial and intriguing trends to keep an eye on in the crypto space, even if this episode turns out to be all smoke and mirrors.

Source: invezz.com

Mastercard identified nine trends that they believe define the future of payments

By Susana | 26 May, 2023 | Comments 0 Comment

The Future of Payments study identified three specific areas that they believe will define the way we buy, sell and interact between now and the end of this decade and beyond.

Mastercard last month presented its study called The Future of Payments, which explores nine trends that they believe will shape “The Next Economy“.

Within the report they focused on three specific areas that they believe will define the way we buy, sell and interact between now and the end of this decade and beyond. These three areas are: reimagining money, or how the use of money is being redefined by the emergence of non-traditional assets; smart experiences, which addresses the intersection of the physical and virtual worlds; and sustainable futures, which shows how purposeful consumption impacts product design and the value of a company.

That said, the nine trends within each area are as follows.

Reimagining money

Tokenisation: According to the published study, the notion of money continues to evolve to encompass more tokenisable assets, including points, loyalty, data, rights and new currencies. Therefore, extending this technology to real assets will, over the next five years, transform the idea of value and what we use to pay.

Programmable payments: Artificial Intelligence, smart contracts, APIs and other solutions will come together to simplify commercial payments. New ways of programming payment flows will inject efficiency into the economy, they explained, and this will result in reduced operational costs.

Ubiquitous wallets: For Mastercard, the next generation of digital wallets should make it possible to manage our identity and finances, including tokenised securities. They say the “super wallet” of the future will become the command centre of our daily lives, allowing us to access services and payments in any channel.

Smart experiences

Connected finance: Within this point, the study highlighted that just as omni-channel retailing transformed the way we shop, new technologies are expanding the ways we pay in shops, stadiums, stations, metaverse, etc. Thus, the instantaneous ability to access financial services at scale will allow consumers to bank and pay from anywhere and through any channel.

Borderless payments: Payment networks are expected to eventually break down the physical and digital barriers that prevent the exchange of goods, services and data across markets. In this regard, by the end of this decade, Mastercard said that cross-border payment interoperability will be a fact of life.

Acceptance unleashed: POS check-out is undergoing a transformation thanks to new technologies that are multiplying payment options. From Mastercard’s perspective, acceptance options are expected to increase further over the next two years, benefiting merchants and customers in terms of speed and convenience, but also impacting financial inclusion, allowing more people to solve practical issues such as public transport or access to shows and stadiums.

Sustainable futures

Inclusive credit: In the near term, we will see an acceleration of access to credit for the unbanked through banks, fintechs and other digital players, which will drive global economic growth.

Conscious consumption: Consumers will favour companies that are aligned with their ethical, social and environmental principles. They will prefer local companies that meet ESG or Zero Emissions criteria.

Built-in trust: On this last point, due to the rise of fraud and identity theft, the Mastercard study revealed that trust will become the key differentiating factor between companies, with those that earn consumer trust retaining the lion’s share of payment flows.

Source: Cointelegraph