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​​Australian Firm to Accept Tether in Sydney Stock Exchange IPO Bid

The Australian capital-raising platform STAX has announced that its client the West Coast Aquaculture Group (WCA) is to become the country’s first business to launch an initial public offering (IPO) that will accept a blockchain-powered token, the stablecoin tether (USDT), as part of its fundraising drive.

WCA is set to be listed on the Sydney Stock Exchange (SSX), with the first shares in the company set to be traded on or around November 19.

In a press release, STAX wrote,

“USDT was chosen over bitcoin (BTC) and ethereum (ETH) due to the stability of pricing and the velocity at which it is traded.”

Michael Go, the CEO of the SSX, commented that the move to accept tether was “a first, and historic development in the Australian market which will dictate the future of capital raising, particularly for growth companies.”

Kenny Lee, the CEO of STAX added that the “acceptance of USDT in an IPO is a transformative move in Australia and a significant step forward for crypto adoption in general”.

Australia’s leading stock exchange, the Australian Securities Exchange (ASX), has attracted criticism from a number of investors after adopting an apparently unfriendly stance toward crypto-related businesses. Earlier this year, it moved to delist companies involved in the crypto and blockchain technology fields, such as Byte Power and First Growth Funds.

The latest development could indicate that the SSX is taking the opposite route, and is instead looking to strengthen its position as the preferred venue for Australian crypto-related businesses.

Based in Melbourne, WCA operates marine farming operations in Malaysia, and sells fish and other seafood to wholesale and retail customers located in Malaysia, Hong Kong, and Singapore.

The funds the company aims to raise through the IPO will be used to finance WCA’s expansion, according to its prospectus.

The business is offering a maximum of 14m shares priced at USD 0.35 which means the IPO could raise up to AUD 5 million. The company said it hopes to raise at least USD 3.5m in the listing. As of UTC 10 am, the firm has raised just under USD 0.5m.

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💣 Crypto exchange Currency.com announces cancellation of trading commissions for tokenised assets

Regulated cryptocurrency exchange Currency.com has announced the cancellation of commissions on 1,539 tokenised instruments when trading with leverage, including:

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❗️This offer is only valid between 2 November 2020 and 31 January 2021. The cancellation of fees does not apply to cryptocurrencies and DeFi tokens.

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​​Bitcoin Inches Closer To USD 15,000, Analysts Eye Higher Levels

After surpassing USD 14,000 yesterday, bitcoin (BTC) jumped above USD 14,800 today, reaching another almost three-year high, while analysts expect even a stronger rally.

At pixel time (12:50 PM UTC), BTC trades at USD 14,871 and is up by almost 8% in a day and 13.5% in a week. The most popular cryptocurrency is also the best performer among the top 20 coins by market capitalization today and in a week.

Also, bitcoin dominance, or the percentage of the total market capitalization, moved above 64.5%, or a level that was last seen in June 2020.

According to Northman Trader founder Sven Henrich, as long as BTC can remain above the breakout trend line it has "significant technical room higher."

"Also note BTC is showing some retracement action and has room lower for a potential retest of the trend line. But note that inside the larger wedge consolidation a potentially much more bullish pattern has emerged, that of a potential inverse which would point to near USD 17,000," he said in his note yesterday.

He added that "a true test for BTC as a hedge against fiat currency destruction" would be if BTC and stocks decouple from each other.

"For example: A drop in equities while BTC races toward the 17K technical target. That might convince to support the argument," Henrich said, adding that "We’ll likely know more on that front in the next 3 months or so."

Meanwhile, Mike McGlone, a commodity strategist at Bloomberg Intelligence, said that previous BTC resistance at about USD 10,000 may transition toward USD 20,000 in 2021.

Argentinean Crypto Bill Headed for Parliamentary Vote

Crypto is dominating the headlines across the board in Argentina, with an ambitious private member’s bill proposing the legalization of cryptoassets and the launch of a central bank digital currency (CBDC) heading toward a parliamentary vote.

According to iProUp, the bill has been masterminded by Ignacio Torres, an MP for the main opposition coalition party Juntos por el Cambio (meaning “Together for Change”).

Torres’ bill has been drawn up in conjunction with pro-business pressure groups and fintech industry bodies, but still has to pass one hurdle before MPs in the Argentine lower house, the Chamber of Deputies, votes on the measure: The bill should pass before the regulatory Financial Information Unit next week. The unit is mainly charged with policing anti-money laundering (AML)-related matters.

But should the regulator approve the bill and decide not to amend it before the MPs vote, Argentine lawmakers could be given the power to grant crypto legal status. The bill also proposes recognizing tokens as having financial value – and would allow companies in the nation to accept bitcoin (BTC) and altcoins and process crypto payments.

Torres also wants the central bank to commit to launching launch an e-peso – a CBDC.

Elsewhere in the country, the crypto betting service Cloudbet has announced it is launching its services in Argentina.

Per Criptonoticias, the firm has created a website and blog in Spanish specifically for Argentina-based crypto gamblers.

Cloudbet stated that it would provide sports betting and a “welcome bonus of up to BTC 5” for new members from the Latin American nation.

The media outlet quoted a spokesperson for Cloudbet as stating,

“As there is so much interest, we believe this is the perfect time to allocate more resources to help Argentinian people understand the benefits of gambling with cryptoassets.”

And crypto has even made the pages of celeb watch media outlets, after reports emerged that one of the country’s biggest stars, Susana Giménez, 76, has a new boyfriend, named Anibal – described as being a “very successful” “crypto businessman.” It looks like another way to inform masses about the existence of cryptocurrencies.

​​Bitcoin Rally Supported by More Busy Miners and Lower Fees

As bitcoin (BTC) rallied, with the trading volume rising as well, the transaction fees moved in the opposite direction as miners turned more of their machines on.

Bitcoin has made quite a move upwards since the beginning of November, with analysts predicting further volatility, but also appreciation in this month. The world's number one coin surpassed the USD 16,000 level for the first time since January 2018 just yesterday, and today jumped above USD 16,400 before correcting lower.

At the same time, the trading volume has been rising. At the time of writing, on November 13, Coinpaprika shows BTC 1,552,121 changing hands so far, worth around USD 25n. This is already up from yesterday's BTC 1.52m, as well as 31% more from the BTC 1.18 seen three days ago - which was the lowest amount recorded this week so far. In comparison, the highest number seen last week was BTC 1.87m, and the lowest was BTC 1.2m.

Meanwhile, the fees have been dropping in the last ten days. After jumping to USD 11.99 on November 3, the 7-day moving average fees dropped 41% to USD 7 recorded yesterday. This is still a lot higher than USD 2.18 recorded before the latest jump in fees.

The median transaction fees show a similar picture, dropping 56.6% between November 3 and November 12. Their USD 2.9 is still higher than USD 1.17 seen in mid-October.

That said, hashrate, or the computational power of the Bitcoin network, shows something of an inverted fee picture: after dropping substantially in late October, it started climbing again on November 2. It's gone up 17.7% between then and November 12 to 127.36 EH/s. It's still a lower than the all-time high of 147.21 recorded in mid-October.

Bitcoin mining difficulty, or the measure of how hard it is to compete for mining rewards, is expected to drop again during the next adjustment in three days, following the second-largest drop in the network's history.

​​The Bitcoin Playbook: Double-Digit Rally -> Double-Digit Selloff -> Pump

After a double-digit rally, a double-digit selloff in the crypto market followed today - with altcoins taking the strongest hit, as is usual in this already tested crypto market playbook.

So, the news this morning is that everything is per usual - nothing new under the crypto sun. As we have seen many times before, the crypto riseth and the crypto dropeth. We have also been warned by analysts that November will see bitcoin (BTC) whales accumulation driving further appreciation in price, but this will be accompanied by higher volatility. And voilà.

Bitcoin today (10:03 UTC) dropped more than 11% in 24 hours and 2.5% in a week to USD 17,000, even dipping below this level - moving further away from the long-awaited all-time high. Ethereum (ETH) didn't fare any better in 24 hours, dropping more than 15% to the price of USD 505, though it's still green over the course of the week.

That's far from all, as nearly all top 100 coins by market capitalization have gone red in the past few hours. Among the top 10, XRP was hit the hardest, dropping nearly 23%, followed by cardano (ADA)'s 20% and chainlink (LINK)'s 19.5% plunge. These are also among the highest drops on the entire top 100 list, with some other projects reaching as far as -24% at the moment.

Speaking earlier of warnings, another one came from venture capitalist and First Block Capital founder Marc van der Chijs, who already in August stated that more bitcoin flash crashes are to be expected in the new bull market. Furthermore, Vijay Ayyar, Luno exchange's head of business development, told Bloomberg that "conditions are very massively overbought and bound for a correction," adding that he believes "we’ll see all-time highs before a larger drop/correction." Additionally, economist and trader Alex Krüger argued that altcoins "usually move in the same direction of bitcoin, but more (in both directions)" and you "can think of altcoins as leveraged bitcoin plays."

That said, it seems to be to nobody's surprise that the entire market turned bloody with BTC as well. As for individual altcoins, Chainalysis chief economist, Philip Gradwell, gave a possible explanation for the drop of at least one of them. He said that, unlike BTC and ETH with "relatively usual" on-chain metrics, "XRP continued to have large inflows to exchanges on Wednesday, 125% above the 30 day moving average, although these were less than Tuesday's record inflows. That is a lot of supply for sale, inevitably leading to lower prices."

Per the comments by analysts, traders, and others online, much of the damage was done on crypto exchanges Binance, Bybit, and FTX, suggesting traders being overleveraged there.

Speaking of reactions to the drop, among the comments within the Cryptoverse, there were notes of "orderbooks on Coinbase being obliterated"; those jokingly and/or sarcastically welcoming the drop, as a purchase opportunity and a chance to accumulate more crypto; statements that the correction would be satisfactory only if it was followed by a "golden entry like it did in early September, adding "sub 14K at least please"; calculations of a potential drop to USD 14,000 and no further, based on the previous post-all-time-high corrections; and arguments that "market is euphorically bullishly selling," and "ATHs is now only a question of when, not if."

As for an explanation behind the drop - "Leverage happened," said Alex Krüger, "that's all. Greedy traders decided to get onto levered longs at the top, and they got flushed out. This is how markets work," he said.

Others are emphasizing that "Shit goes up and down, it's the foundation of any market," as analyst Teddy Cleps put it. He pointed out that bitcoin went from USD 3,000 to which it had dropped on Black Thursday in March to nearly 20,000 only months later, adding "Embrace the volatility don't fear it." Many commenters agreed with this opinion, stating that the same goes for altcoins.

​​Undetected Inflation: Your Money Devalues Faster Than You Think

Lockdowns, working from home, and physical distancing caused people to spend larger shares of their household budgets on food and housing, while fewer people bought nonessentials, like airline tickets and clothing. And with incomes down as millions have lost their jobs, spending on nonessential items will likely remain depressed.

The consumer price index (CPI) does not reflect these abrupt changes in spending patterns because the CPI weights are not continuously updated. For example, the CPI could be pulled down by a decline in the prices of nonessentials that are no longer purchased.

A new IMF staff paper uses spending estimates derived from credit and debit card data to adjust the CPI weights to match spending patterns during the pandemic. The study finds that inflation during the first three months of the pandemic was actually higher than we thought.

The chart of the week looks at the difference over the February–May timeframe between a COVID-19 price index that adjusts the CPI weights based on the impacts of COVID-19 on spending in Canada and an index with unchanged CPI weights. The diamonds in the chart show the difference between the two indexes by region. In seven of the eight regions shown, the CPI is below the COVID-19 index. Looking at the average for all regions combined, the gap is 0.23 percentage points.

The main positive contributors to the gap between the COVID-19 index and the CPI are food and transport, each contributing 0.16 percentage points to the world gap. Rising food prices contribute to the faster growth of the COVID-19 index in all eight regions. Falling transport prices, which have a larger weight in the CPI than in the COVID-19 index, also contribute to the faster growth of the COVID-19 index in all regions except sub-Saharan Africa.

The main negative contributors to the world gap are housing, which contributes –0.03 percentage points, and clothing, which contributes –0.08 percentage points. Housing has a higher weight in the COVID-19 index than in the CPI, but its price index is so close to the overall CPI that increasing its weight does little to move the COVID-19 index away from the CPI. The downward effect of clothing is due to seasonal price increases having a smaller weight in the COVID-19 basket.

Despite the finding that CPI weights underestimated inflation in the early months of the pandemic, a quick update of the CPI weights to reflect the spending patterns during the pandemic would be impractical. Furthermore, introducing weights that are based on a short timeframe can reduce an index’s accuracy over the longer run. A better approach would be for statistical agencies to develop a supplementary index whose weights reflect spending patterns during the pandemic. This would give policymakers a better picture of the effect of inflation on the prices that consumers are actually paying.

​​Bitcoin Makes US Dollar Less Relevant - BlackRock CEO

While the most popular cryptocurrency, bitcoin (BTC) is still an untested territory, it possibly can evolve into a global market, and already makes the US Dollar less relevant, according to Laurence D. Fink, CEO of the world’s largest asset manager, BlackRock.

He was answering a question on digital currencies during The 2020 Stephen C. Freidheim Symposium on Global Economics on December 1.

"Having a digital currency has a real impact on the US Dollar," Fink said, while former Bank of England Governor Mark Carney, who was also participating in this discussion, seemingly agreed with this statement.

According to the CEO, digital currency makes the need for the US Dollar less relevant.

"I'm not talking about Americans, I'm talking about international holders of dollar-based assets. The question I would raise - does it change the need for the dollar as a reserve currency if they were a true digital currency that was separated from dollar-based assets?" he asked.

According to Fink, BTC is still an untested, thin and relatively small market that could possibly evolve into a global market one day.

For him, the fact that so many people are excited about it and want to learn about it - is "a very telling sign."

The CEO argued that digital currencies help bring down costs, but it needs to be organized and be "a component of a governmental policy worldwide."

"Many questions need to be answered before I could say it's real and alive. It certainly has the potential to evolve into something real," Fink said.

As reported, in November, Rick Rieder, BlackRock's Chief Investment Officer of Global Fixed Income, said he thinks that BTC "could replace gold to a large extent" because BTC is "much more functional."

At the end of last year, BlackRock had USD 7.4 trillion in assets under management.

At pixel time (07:08 UTC), BTC trades at USD 18,954 and is down by 2% in a day and is almost unchanged in a week. The price rallied by 37% in a month and 154% in a year.

Meanwhile, during the discussion with Fink, Carney joked about the importance of mentioning "the B word" as this "gives us the headline" while other things they were discussing on the implications of the coronavirus pandemic on global economic policy "will be far more determinative to our future."

​​Lawyer Warns Russian Crypto, Blockchain Exodus Has Already Begun

Expert voices are warning that a mass crypto and blockchain exit is already underway in Russia, with companies seeking a way out over concerns that the nation is “lagging behind” other more business-friendly regions.

Per DP.ru, Yuri Brisov, a member of the Commission on the Legal Support of the Digital Economy of the Moscow branch of the Russian Bar Association, global trends that have seen investment in crypto and blockchain companies intensify in recent years are passing Russia by.

Brisov said that Russia was falling away from countries where real-world applications of the technology are soon set to make their debuts.

The lawyer stated,

“Russian clients mainly come to us with inquiries about how to transfer their businesses from Russia to jurisdictions where it is possible to work with crypto and blockchain legally. Fortunately, there are enough of these kinds of jurisdictions out there. Russia is beginning to lag far behind the rest of the world in this respect.”

The media outlet pointed out that it has been a relatively quiet past few months for Russia’s crypto and blockchain scene – despite busy progress elsewhere.

It observed that the last “major project to make a splash in the media” was the issuance of a loan secured by crypto, conducted by Expobank in late summer.

Since then, the outlet reported “nothing new or interesting has appeared on the market, although many expected the market to pick up” after Moscow issued its first piece of crypto-related legislation, also in summer this year.

The same outlet also noted that despite talk of Norilsk Nikel’s much-talked-about tokenized resources trading platform – which is still yet to materialize some 10 months after it was granted regulatory permission to launch.

Brisov commented,

“The industry waited a very long time for legislation. But the text of the law confused everyone even more. Big businesses have either given up on blockchain, or have put their projects on hold, waiting for better times.”

​​Crypto Can Disrupt Legacy Finance And Add Another Layer On It - Panel

Blockchain and cryptocurrencies have the potential to disrupt the financial status quo, but they can also reform the existing legacy financial services such as banks and insurance companies by adding an additional tech layer on top of their activities, according to the participants of a panel discussion held during this year’s Paris Blockchain Week Summit today.

The virtual panel, titled How tech companies challenge the financial status quo, featured a number of industry representatives on its first day on December 9. These included Bernard-Louis Roques, Co-Founder and CEO of venture capital firm Truffle Capital, Charlie Meraud, CEO of liquidity provider Woorton, Pietro Grassano, Business Solutions Director Europe at blockchain platform Algorand, and Imre Fazekas, Co-Founder of banking platform developer Perfinal Technologies.

Roques, whose company has about USD 1.5bn in assets under management, said Truffle Capital’s interest in fintechs dated back to 2014, and the last years have brought a surge in the firm’s investments in blockchain-focused startups.

“We start from use cases, what can actually be useful for insurance companies and banks,” Roques said, adding that blockchain was a good tool for anti-fraud, enhancing the security of transactions, and tracking the flow of funds to the insured. Owing to the use of public ledger, “the verification process is costless, but also the network is costless”.

Roques admitted to being a hodler, adding that he has personally invested in crypto for about four years.

“And I will stick to it, I will not sell my assets” in the near future,” the VC manager said.

Algorand’s Grassano said he sees “a sort of tripartite distinction in the market. You see startups, you see government and regulatory interest such as central banks, and then you see private finance”.

Grassano said this was triggering challenges in extending the scope of blockchain tech over the more traditional financial sectors.

“This is a real disruptive infrastructure … [and] it’s not only about cost savings. It’s about new business models, new revenue streams,” Grassano said.

The key condition for banks to increasingly embrace crypto lies in the regulatory barriers, according to Perfinal Technology’s Fazekas.

“Our clients definitely have an intention to investigate the use of cryptocurrencies,” Fazekas said, but he added that the banks’ main focus was on “digital currencies”.

For most banks, to move a large share of their assets into crypto in compliance with the existing regulations could be “a tricky road”, according to him.

Woorton’s Meraud said that the entrance of big tech companies such as Square, MicroStrategy, and PayPal into the cryptoasset world means we are witnessing a major shift which mostly takes place in corporate mindsets, as those companies could have already come onboard the crypto train several years ago.

“When you’re PayPal, giving more space to bitcoin is very simple,” Meraud said.

According to Woorton’s CEO, as a liquidity provider, the company does not have to long bitcoin.

“We could be shorting bitcoin as well. We’re taking what the market is trading … and the result is our volume is mainly BTC,” said Meraud.

​​Bitcoin Rallies Above USD 19K Again, XRP Dumps

It took less than a week for the most popular cryptocurrency, bitcoin (BTC), to return above the USD 19,000 level after it was trading close to USD 17,600 this past Friday. Meanwhile, one of the recent best performing major coins, XRP, is the only top 10 token in red today.

At the time of writing, BTC trades at USD 19,278 and is up by 4.5% in a day, erasing all its weekly losses. The price is now up by 17% in a month and 162% in a year.

Other coins from the top 10 club are up by 2%-4% in a day, except XRP that dropped by 4%, to USD 0.51 and is now the worst-performing coin in the past 7 days (-16%). Other major cryptoassets, except BTC, are still down in a week by 2%-6%.

As reported, it appears that large traders, whales, and institutions that accumulated BTC around USD 10,000 levels decided to take profits during this rally, while retail traders mostly kept adding to their positions during the price surge, major crypto exchange OKEx said in their latest report. The result of this was that retail traders were trapped below USD 19,000, but given how overall market sentiment remains bullish, their losses were expected to be short-lived.

Also, compared to the previous cycle, the world’s largest crypto asset appears to be “right on track” and “the similarities between cycles are striking,” according to US-based crypto research firm Delphi Digital.

Meanwhile, on Friday, US-based business intelligence company MicroStrategy confirmed it raised USD 650m by selling convertible senior notes due 2025 in order to buy more BTC. Also this week, the news broke that America’s Massachusetts Mutual Life Insurance (also known as MassMutual) has purchased USD 100m worth of bitcoin to add to its general investment fund.

​​Exchanges Send More USD 1M Bitcoin Transfers as Investors Look For a Hedge

In 2020, exchanges have reportedly been sending 19% more bitcoin (BTC) transfers worth USD 1m or more, as investors are looking for a hedge against inflation and devaluation.

BTC has been rallying recently, even hitting a series of all-time highs before correcting downwards. The market is actually being driven by North American institutional investors, according to Philip Gradwell, the chief economist at blockchain analysis firm Chainalysis, as cited by Bloomberg. The largest investors come from the region, he said, while North American exchanges are getting net inflows BTC from other areas in the world as well.

"And the investors have been large — exchanges are sending 19% more transfers worth USD 1 million or more this year while bitcoin’s price has been above USD 10,000 compared with 2017 when it was trading above those levels," the article cited Gradwell.

Major companies, such as software company MicroStrategy and payments company Square, have already invested in the world's number one crypto, as did some well-known individuals like hedge fund manager Paul Tudor Jones.

As another, the most recent example of an investor looking for a hedge, UK-based Ruffer Investment Company allocated 2.5% of it Ruffer Multi-Strategies Fund to bitcoin, worth some USD 15m. "This is primarily a defensive move, one made in November after reducing the company's exposure to gold," said an update to shareholders. "We see this as a small but potent insurance policy against the continuing devaluation of the world's major currencies."

These are examples of companies that are "laying out the groundwork for how you add bitcoin to your balance sheet, how you should think about bitcoin as a substitute for cash," Seth Ginns, a managing partner at investment firm CoinFund, was quoted by Bloomberg as saying. Ginns also claimed that there is "a lot" of interest from hedge funds in BTC, and that a broader institutional adoption trend is likely to continue in 2021.

Crypto market analysis firm Coin Metrics also noted that, though avoiding bitcoin as a risky asset, many institutions endorsed it in 2020. Many find that the reason behind it is "the growing narrative that bitcoin could serve as a good hedge against inflation," particularly in the midst of the COVID-19 pandemic, as well as the combination of rising fiscal deficits and quantitative easing pushing "federal banks to their limits" and creating "conditions that could lead to a significant inflation rate rise."

On the other hand, bitcoin's "predictable and transparent monetary policy is ultimately what makes it a good potential hedge against inflation," said Coin Metrics. New bitcoins are issued every time a new block is mined, meaning there is a predictable, transparent and auditable supply schedule, and there is a limited supply of BTC.

It should then come as no surprise that, in a poll taken in early December, some 15% of fund managers surveyed by Bank of America said that BTC is the third-most crowded trade, according to Bloomberg. Shorting the USD is found to be the second-most crowded trade and "long tech" as the most crowded one.

Furthermore, US senator-elect Cynthia Lummis is quoted by Market Insider as saying that she's a hodler, and that bitcoin is a great store of value which can help with the US national debt as an "alternative path" should an initial plan to retire the debt fail. Additionally, "if we reach the point where we have overspent so much that things start crashing down, the black swan event occurs with any regard to any fiat currency...there is a backstop available to every government in the world and that backstop is bitcoin," said Lummis.

​​Can Decentralized Finance Ever Be Regulated?

As stock markets around the world struggle through the pandemic, bitcoin (BTC) has seen a steady rise in its price. In December, the cryptocurrency surpassed its all-time high of USD 20,000 and hit USD 24,000 just this weekend.

While this growth can be partially explained by investors being spooked by stock markets during the pandemic and looking for better investments, it is also influenced by the new, but evolving, decentralised finance market, also known as DeFi.

DeFi allows people to engage in financial services such as borrowing, lending and investing but without intermediaries such as banks using blockchains and cryptocurrencies. Blockchains store digital records of transactions. Individual records, called “blocks”, are linked together in a single list, which creates the “blockchain”. Blockchains are used in DeFi to create “smart contracts”, which are automated, enforceable agreements that don’t need intermediaries, such as banks.

The DeFi market with over USD 16bn locked in its protocols is one to watch.

DeFi has enormous potential in international trade by making payments more efficient. It could do away with the need to use intermediaries such as correspondent banks, which are financial institutions that offer services to a customer on behalf of another bank, usually in a foreign country. DeFi could also potentially help with the availability and equality of opportunities to access financial services.

No accountability

There is, however, a difficulty holding any particular person or entity accountable for any technological failure in this market. This can be anything from security failures, when the system is hacked and digital assets are stolen, to the collapse of the entire system.

Unlike traditional banks, which can be sanctioned or shut down, there is nobody who can be held accountable or take responsibility when something goes wrong. This is because the applications in DeFi are built on decentralised systems, which distribute functions and power away from a central location or authority. Every node (computer, IP, server) connected to the system makes its own decision, and the final behaviour of the system is a collection of the decisions of these individual nodes.

This is further complicated by the fact that DeFi transactions typically operate globally, and when regulatory standards are created for this sector in one country, platforms may gravitate to countries with less strict ones. There is also the challenge of global coordination, especially as countries are at varying stages of financial regulatory development. While advanced economies such as the UK and US have stronger regulatory frameworks, most in developing economies do not.

​​Small Exchanges Start Suspending XRP Trading Following the SEC Lawsuit

ow the fourth-largest cryptoasset by market capitalization, XRP, has started getting suspended by small exchanges following a lawsuit filed by the US Securities and Exchange Commission (SEC) against major US-based blockchain company Ripple.

Some small exchanges have started notifying their users of certain changes regarding the trading of Ripple-affiliated XRP. Chicago-based digital asset exchange Beaxy Exchange said that as the SEC has charged Ripple with conducting an unregistered security sale, they have halted trading for XRP "pending further news," while "XRP withdrawals will remain enabled until further notice."

However, at the time of writing, the 24-hour trading volume at this exchange stands at USD 90,000, while XRP's trading volume is only USD 11, per Coinpaprika data.

"We have suspended all XRP payment in and trading services on the OSL platform, effective immediately and until further notice," stated today this digital asset platform licensed by the Securities and Futures Commission (SFC) of Hong Kong. Furthermore, "CrossTower made the decision to remove XRP from its US-based trading platform – effective immediately," said the exchange and a member of the Coinbase-led Crypto Rating Council in their December 22 announcement.

As reported, the SEC filed an expected action against Ripple and two of its executives, Christian Larsen and Brad Garlinghouse, claiming that they raised over USD 1.3bn through an unregistered, ongoing digital asset securities offering, while "Larsen and Garlinghouse also effected personal unregistered sales of XRP totaling approximately USD 600 million."

Some have reacted negatively to the above-mentioned announcements by the exhanges, claiming, for example, that this is damaging to investors and that it's too early to make moves before any sort of ruling. Beaxy co-president Nick Murphy argued in return that it's the exchange's "responsibility to be proactive on things like this," and that "users can still withdrawal, we are just halting trading until further clarification comes out."

However, it seems that the Cryptoverse is expecting more exchanges to follow with announcements of their own about changes in trading and possible delistings, with some arguing it could be a coordinated effort, particularly given that the exchanges stand to lose money as well. Still, "any crypto exchange who doesn’t delist XRP this week is out of their mind" and "crazy to list it without a licence" should the SEC deem it a security, wrote Bruce Fenton, CEO of Chainstone Labs, with INX Limited's Alan Silbert agreeing.

​​Ether prices soared on Sunday, trading above $700 for the first time since May 21, 2018.

The native currency of the Ethereum network’s break above $700 marks an 11% gain in just 24 hours.

Ether (ETH, +12.84%) was as low as $624.76 in the 11:00 UTC (6:00 a.m. ET) hour, just five hours before trading at $700.

The second-highest cryptocurrency by market cap, the total value of ether was $80 billion as of press time.
Bitcoin has also been rallying over the Christmas weekend, at one point piercing the $29,000 mark. It was trading in the $27,300 range when ether made its move higher than $700.

Volume was noticeably higher on the eight exchanges tracked by the CoinDesk 20. The combined value of ether changing hands on those exchanges was more than $2.3 billion. The average daily volume was $2.175 billion over the previous seven days.

​​DeFi 'Genie Is Out' and Is Set For Growth in 2021

In 2021, decentralized finance (DeFi) might see stronger interest not only from individual users but from institutional investors also, as the environment for this nascent sector is still favorable, according to industry players speaking. Meanwhile, regulation might slow down this expansion.

“It appears to me that 2021 will be a year of enlightenment regarding cryptocurrency,” Bo Oney, Chief of Compliance of Bitcoin ATM Network Coinsource, said. “As the appeal of DeFi grows, you will see adoption and utility permeating as the main trends throughout 2021.”

The macroeconomic trends of low and even negative interest rates globally will mean that DeFi will be increasingly relevant to people, argued Monica Singer, the South African Lead for Ethereum (ETH)-focused major blockchain company Consensys, and not just to “the tech and financial nerds.” Another trend Singer sees picking up steam in 2021 is institutional money and professional traders increasingly wanting exposure to DeFi.

“As long as the legacy finance world keeps breaking, people will be pushed in our direction,” she said, adding that the key challenges will be education and simplifying the user experience.

Meanwhile, according to Will Liu, Head of decentralized data marketplace SAGA, DeFi passed the dramatic growing stage at the end of 2020. In 2021, it will be “a more standardized and easy-to-use form” and “a nice option for individual investors for a long time.”


While DeFi is still in its nascent phase, said Konstantin Richter, CEO and Founder of Blockdaemon, certain growing signs are indicating that it’s beginning to enter a phase of maturation. Therefore, a “particular area of interest will be whether the DeFi space can follow the lead of the crypto market and attract greater institutional investment,” he said.

Institutional adoption of crypto has proven to be a significant driver for adoption by retail users, and if DeFi can “mature and manage to attract similar mainstream investment, there are likely to be huge opportunities for early adopters of the technology in the coming year.”

Anthony Lauriola also said that DeFi will begin to define itself in 2021, with more industry players likely incorporating some element of DeFi into their existing offerings. “Last year DeFi established itself but this year, DeFi will likely see steady adoption” as it matures. “Currently, DeFi has a lot of potential to make common financial processes like lending, borrowing, and earning interest more accessible to emerging markets,” he said.

Ilia Maksimenka, Founder of digital payment platform PlasmaPay, argued that, while big news in 2020, DeFi’s “overnight success story has been years in the making.” The wider industry began to notice it and understand its potential in 2020. “Now that the genie is out of the bottle we expect the sector to rapidly grow in strength this year,” said Maksimenka. He added that the coronavirus pandemic has accelerated the move to a more decentralized world.

​​Bitcoin On The Move Again, Touches USD 36K, Outperformed by XLM, ADA

The most popular cryptocurrency, bitcoin (BTC), just briefly touched the USD 36,000 level for the first time with a double-digit jump in a day before correcting lower. The majority of other top cryptoassets are rallying too. (Updated at 08:33 UTC: updates throughout the entire text).

At pixel time (08:28 UTC), BTC trades at USD 34,680 and is up by 10% in a day and 22% in a week, increasing its monthly gains to 85%. Bitcoin reached the USD 30,000 level on January 2.

And while the second-largest cryptoasset by market capitalization, ethereum (ETH), is also up (+7%, to USD 1,106), stellar (XLM) is back into the top 10 club as it rallied by 66% in a day, reaching USD 0.27. Cardano (ADA) is the second-best performing coin in the top 10 club (+27%, to USD 0.286).

Other top coins are up by 2%-5%, except XRP that is down by 2.5% in a day.

"Bitcoin has entered into a new phase of price discovery, largely driven by amplified institutional interest in the digital asset. We have not yet seen peak retail participation, as highlighted by the low search and social activity relative to 2017," Craig Russo, Director of Innovation at Polyient, an infrastructure underpinning decentralized virtual economies, said in an emailed comment.

According to him, retail participation, coupled with accelerated institutional participation, will likely continue to drive the bull market in Q1.

"Bitcoin successfully cemented itself as a legitimate asset in 2020 and will continue to be adopted across the financial industry, regardless of any positive shift in the traditional global economy," he added, warning that there will be high volatility during this bull season as the market is still very thin and there is potential for enormous volatility if BTC whales begin to dump.

Crypto intelligence platform Glassnode claims that widespread retail interest in bitcoin is increasing, with the number of address holding a non-zero amount of BTC reaching an all-time high of over 33 million. However, the number of daily new BTC addresses has still not reached 2017 levels.

"These metrics, therefore, paint a bullish picture of a market characterized by healthy, sustainable growth as opposed to hype," they added.

Also, according to popular BTC analyst Willy Woo, inventory depletion on spot exchanges has stopped, signifying the re-accumulation phase of the macro cycle is likely complete.

"Since we already know institutions are buying in large quantities, the flattening of spot inventory depletion is a sign that retail buyers are now entering in large volumes, attracted by recent price rises," Willy Woo was quoted as saying in a blog post by Glassnode.

Meanwhile, according to Konstantin Richter, CEO and Founder of Blockdaemon, the third Bitcoin halving means that BTC 300K will be minted this year, compared to BTC 600K in previous years.

"Since a significant portion of existing bitcoin is illiquid, 300K is far too little supply for the exponential demand coming from institutions and triggered by the global covid crisis (new financial assets are needed to hedge against inflation). This represents an example of the flywheel in motion--half the supply and a probable doubling in demand, which in turn drives further demand due to price increases," he said.

While BTC cycles are inherently unpredictable (regulatory changes in certain key countries could have a significant effect), according to Richter, the next big hurdle for bitcoin is USD 50,000.

​​Not Only Bitcoin Price Is Changing During This Bull Run

As the most popular cryptocurrency, bitcoin (BTC), keeps scoring its new all-time highs, industry observers see important changes on the BTC adoption front too.

According to Anthony Lauriola, Chief Operating Officer at blockchain portfolio company Dan Holdings, in 2020, we saw “a significant shift in the way people view cryptocurrency,” as people are starting to see it more as a method of payment and not just a store of value - a trend Lauriola said will continue into 2021. “As we see more global entities entering the crypto space, we will likely continue to see bitcoin and other cryptocurrencies continue to increase in price, value, and popularity.” Additionally, crypto adoption in emerging markets will also play a part in overall market growth in the coming years.

Also, as governments are forced to print mass amounts of cash to offset negative effects on the economy, many people have turned to bitcoin to hedge against inflation. “We may start to see the effects of this in 2021 and I believe this could be the driving factor for a bitcoin bull market," Lauriola said, estimating that BTC will hit USD 100,000 this year.

Lauriola further argued that, last year, there was a large increase in the number of people who relied on cryptocurrencies and digital payments for remittances and bill payments in many regions of Africa.

“There is still a lot to be learned as far as individuals using cryptocurrency as a payment method, but we are beginning to see the barriers to entry being lowered as technology becomes more accessible for everyone.”

Similarly, Philippe Bekhazi, CEO of stablecoin platform Stablehouse, expects that "any further economic fallout from the pandemic will spur growth of payment networks predicated on bitcoin or ethereum in emerging economies."


Meanwhile, IBMR.io Managing Director Sinjin David Jung offered an historic perspective.

“While it might seem like a bubble there is a very big difference from other times in the past, like 2008 we had issues in terms of the financial markets and how opaque they were,” he said. The stock market was getting bigger at the time, as were tech stock valuations. And unlike the internet euphoria of 1995-1999, when the internet was “as a single network” … now you have layers of networks, networks upon networks.” He said that this is a very different time and expects this bull market to continue on for the next almost 2 years.

"After that all bets are off but we’re definitely entering into a new economic reality structurally because of the way technology now has changed the way production is globally to create this exponential network upon network framework," he added.

In either case, the general consensus seems to be that BTC will trade between USD 50,000 and USD 100,000 in 2021.

“Considering how well bitcoin has profiled itself thus far in the coronavirus aftermath and given the outlook from our current macroeconomic environment, we're expecting 2021 to be a phenomenal year for bitcoin. It's not entirely unlikely that we'll see bitcoin trade in the USD 50k - USD 100k range,” Eric Wall, the Chief Investment Officer of the crypto hedge fund outfit Arcane Assets, told Cryptonews.com.

According to CoreLedger CEO Johannes Schweifer, USD 100,00 is "only 5 times" from its historic all-time high of 2017: "Bitcoin has shown it can grow more than that in a shorter timespan than one year, so it is more than possible."

At the time of writing (09:14 UTC), BTC trades at USD 41,067 and is up by almost 128% in a month and 405% in a year.

Meanwhile, Sinjin David Jung argued that “as the vaccine kicks in and the stimulus comes out the economy is going to get a kick start but people are still going to be wary of traditional assets and while they probably will still sock something away in the current stock market it will also be in cryptocurrencies.”

​​Bitcoin ETP Boom, Mt. Gox Deal, XRP Hit Again

Get your daily, bite-sized digest of cryptoasset and blockchain-related news – investigating the stories flying under the radar of today’s crypto news. (Updated on January 16 with Exchanges news).

Bitcoin news

German bitcoin exchange-traded product (ETP) from ETC Group has garnered volumes matching those of popular European funds, as BTCetc Bitcoin Exchange Traded Crypto (BTCE) has recorded average daily trading amounting to EUR 57m (USD 68.9m) in the first 11 days of January, according to the Financial Times, citing data from Deutsche Börse. The structure of the bitcoin ETP had "increased the appeal of cryptocurrency investments for institutional investors," who can trade the asset without having to set up a specialized infrastructure or use an "unregulated" crypto platform, Stephan Kraus, head of Deutsche Börse’s ETF segment, is quoted as saying.

Strategists at one of the world’s largest wealth managers, UBS Global Wealth Management, claim that "there is little in our view to stop a cryptocurrency’s price from going to zero when a better-designed version is launched or if regulatory changes stifle sentiment." "Netscape and Myspace are examples of network applications that enjoyed widespread popularity but eventually disappeared," according to the strategists. (Learn more: What And How ‘Slow’ Bitcoin Wins In The Storm Of Crypto Innovations)

Institutional platform Tokensoft has announced a partnership with qualified custodian Anchorage, to develop xBTC on Stacks 2.0, which is a blockchain that enables apps and smart contracts on Bitcoin (BTC), said the press release. They will provide institutional-grade custody and programmability of new digital assets on Stacks 2.0 via Wrapped, enabling BTC to be natively wrapped on the Stacks 2.0 blockchain, which the partners find an important step toward native decentralized finance (DeFi) on Bitcoin and a move that could help activate some USD 627bn in largely passively held capital on the network.

Exchanges news

CoinLab said it reached an agreement with a Japanese court-appointed trustee to the Mt.Gox bankruptcy, Nobuaki Kobayashi, and MGIFLP, a Fortress company, that "clears a path for tens of thousands of the earliest bitcoin investors to receive 90% or more of their allocated bitcoin, a digital asset that was priced at USD 489 the day Mt.Gox filed for bankruptcy." They said that small creditors (up to JPY 200,000 (USD 1,925)) will receive 100% of their claims. "Anyone who does not want to receive the proposed amount may stay in and wait until the litigation is over," they added.

Kraken said that, given the recent US Securities and Exchange Commission filing against Ripple, the major exchange is halting XRP trading for US residents no later than January 29, 2021 at 5pm PT (January 30, 2021 at 1:00 UTC). However, these clients will still be able to deposit, hold, and withdraw XRP with Kraken.