BitDigest March 20 · Issue #619
- Crypto markets jumped overnight gaining $33 billion in total market-cap, an increase of 21.8%
- Another Japanese lawmaker has expressed the need for Japan to issue a central bank digital currency to maintain the strength of its currency in global markets
- Numerous reports are appearing warning consumers to beware of fake websites and malware
I heard a rumor earlier this week that a major bank (my bank) had limited cash withdrawals from ATMs. This turned out to be false, but banks are closing allowing employees to go into self-quarantine (Chase announced it was closing 20% of its branches and I expect more banks to follow) and there are already stories of people either withdrawing large amounts of cash (Bill Ackman) or banking systems being closed prohibiting cash withdrawals altogether (Venezuela).This obviously gives me fears of the Cyprus bank shut-down of 2013. I do not think this is going to occur – I think the same financial regulators I have questioned over their acceptance of digital currencies are actually doing a good job to help support the global financial system – but going shopping and seeing the empty shelves at my local market adds to my concern that further corona virus fears and market uncertainty could cause a mini run on the banks. The obvious risk avoidance strategy is self-custody of assets. We spoke about this in the office this week, volleying back and forth the benefits of self-custody with the cumbersome processes that still exist and the weaknesses of having a quasi-bearer instrument. The reality is that this technology has improved. We now have dashboards to help manage our assets and systems connecting your wallet to your computer no longer require a cord. More improvements are coming to digital wallet technology, but the question I am asking myself is do we actually want to live in a world where we self-custody all assets? It certainly gives me an added sense of security to know I am in full control of my assets – assuming I do not lose my wallet or forget my password – but our economy has evolved into a service oriented environment, trusted third parties do exist, and they offer great service and drive innovation with new features.For now I remain the master of my own domain and am in full control of all of my own digital currencies. I did withdraw some additional cash this week, but my fiat holdings are still held by a third party and as I sit here today, I think that although the idea of self-custody appears to be utopian, many of us will likely ask our same financial partners to custody our digital assets with our traditional market securities. Maybe using multi-sig will provide us with a false sense of security that we are still in control, but the reality is its no different than what we are doing today; we are still relying on that trusted third party to facilitate our transactions. |
Weekend Reading Bitcoin’s 48-hour increase coincides with $180 million of new tether (USDT) being minted. Past studies have argued that bitcoin spikes, including the 2017 run, occurred around new large issuances of USDT. The theory was that the new tether was being minted without 1:1 USD reserves. In response tether published a transparency update with a proof of funds report by Delaware based law firm Freeh, Sporkin & Sullivan LLP. Unfortunately, as of last night, the latest update to this is from June 2018 so this argument will definitely be repeated in the coming days.Here is a copy of the University of Texas study (updated) that raised the initial argument and a rebuttal from the University of Queensland that argues it is unlikely tether manipulation caused the large bitcoin moves. |
The Headlines
![Japan Needs a Digital Yen to Maintain Global Position BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/4ee00f8cf2541f23a50496b6000bca2c.jpeg)
Japan Needs a Digital Yen to Maintain Global Position
![Argentina Releases Blockchain for Gas Distribution BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/f29bcf03350dcf6aaff5f8c02fddec98.jpeg)
Argentina Releases Blockchain for Gas Distribution
![UK Sees Growing Crypto-Blackmail Cases BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/ff9f0324d02863f5e2561ce43da9fc99.jpeg)
UK Sees Growing Crypto-Blackmail Cases
![1.2 million Italians Accessing Bitcoin with Bank BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/3385fe45c04598df059a24ede19b56ac.png)
1.2 million Italians Accessing Bitcoin with Bank
![Scammers Are Stealing COVID-19 Aid With Fake Sites BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/9e91d99e91c5ec62857ff0ab261b8348.jpeg)
Scammers Are Stealing COVID-19 Aid With Fake Sites
![Storj Cloud Storage Platform Launched BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/5c519ea893de708a4c3c773abe48a6b7.png)
Storj Cloud Storage Platform Launched
![Vitalik Provides Future Roadmap BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/eec958d69ce9c3959253b7819cc71bcb.jpeg)
Vitalik Provides Future Roadmap
Market Data
![Bitcoin Sentiment Understandably Weak BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/fear-and-greed-index.png)
Bitcoin Sentiment Understandably Weak
![Bitcoin Still Outperforming S&P 500 BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/6f94350eefd091922afc0a91dcb92d26.png)
Bitcoin Still Outperforming S&P 500
![Sell-Off Driven by Newbies BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/78092d6da107f4ef706b5a74ef4fd718.png)
Sell-Off Driven by Newbies
Exchange, Custody and Product News
![Tether Launching on Bitcoin Cash Network BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/108bbbf4f368854a696a6cc0fc35e6f3.png)
Tether Launching on Bitcoin Cash Network
![Kraken Warns of Malware and Fake Sites BitDigest March 20 · Issue #619](https://cdn.fsinsight.com/wp-content/uploads/2020/03/ff55b73bc59821db5ad8e84deee74ebf.jpeg)
Kraken Warns of Malware and Fake Sites
Reports you may have missed
CRYPTO MARKET UPDATE AFTER ANOTHER DAY OF SIZEABLE OUTFLOWS FROM ETHE 4.58% , THE GRAYSCALE-ISSUED ETF NOW RETAINS JUST 85% OF THE AUM IT BEGAN WITH ON TUESDAY. However, crypto has rallied strongly since the US market closed yesterday, with BTC 1.40% briefly moving above the $68k level, ETH 1.01% rebounding sharply to $3,250, and SOL 3.52% revisiting $184. Among larger-cap tokens, SOL beta names including RNDR and JUP have outperformed over the past 24...
CRYPTO MARKET UPDATE CRYPTO WAS CERTAINLY LOOKING STRONG RELATIVE TO EQUITIES YESTERDAY UNTIL ASIAN MARKET HOURS COMMENCED. Shortly after the HK market opened, we saw increased sell pressure and approximately $100 million in liquidations across all crypto assets, bringing BTC 1.40% down to below $64,000, ETH 1.01% down to $3,150, and SOL 3.52% to just below $170. This contrast in price action during U.S. and Asia market hours has been consistent throughout July....
CRYPTO MARKET UPDATE RATES ARE BROADLY LOWER, WITH A NOTABLY STRONGER RALLY AT THE FRONT END OF THE CURVE AS THE MARKET APPEARS TO BE TAKING POTENTIAL RATE CUTS OVER THE NEXT COUPLE OF FOMC MEETINGS MORE SERIOUSLY. Despite significant weakness in equities today, the crypto market is looking relatively healthy, with BTC 1.40% and many altcoins in the green. BTC 1.40% briefly rallied above $67k but has since drifted back down...
CRYPTO MARKET UPDATE DESPITE BEING THE LAUNCH DAY FOR ETH 1.01% ETFS, CRYPTO BROADLY MOVED LOWER IN THE EARLY MORNING HOURS TODAY, POSSIBLY DUE TO MOVEMENT OUT OF THE MT. GOX TRUSTEE WALLETS. Mt. Gox sent approximately $130 million in BTC 1.40% to Bitstamp, leaving about 90k BTC 1.40% remaining in the trustee wallets. This move lower was likely also influenced by a rise in the DXY. Currently, BTC 1.40% is trading around $66.5k,...