Coinbase says more institutional investors are now using its platform to build direct positions in the cryptocurrency market.

Crypto fund managers are now getting more backing from institutional investors that see the crypto market as an alternative investment strategy.

In a report, the exchange says it observed a “noticeable uptick in institutional business’s growth” in the first half of the year.

According to Coinbase, the “greater visibility of reputable investors warming up to digital assets” is also helping to fuel growing “confidence among this community.”

In May, a hedge fund, Tudor Investment Corporation, disclosed it had taken positions in bitcoin. At the time of this announcement, there were reports quoting the hedge fund’s CEO, Paul Tudor Jones, arguing that bitcoin is a better hedge against inflation.

Jones predicted that the record central banks’ monetary expansion of 2020 will be a “potential catalyst for an increased interest in bitcoin.”

On Monday, July 27, the price of bitcoin passed $10,000 for the first time in several weeks before breaching the $11,000 mark. At the time of writing, the price of bitcoin is oscillating between $10,500 and $11,000.

The recent bitcoin price movement coincided with reports suggesting an imminent release of a second stimulus check for Americans.

In the meantime, Coinbase acknowledges that its “investors are still in the early days of untangling the relationship between macroeconomic policy and crypto.”

Nevertheless, Coinbase says it is seeing a “growing base of our institutional clients organizing around the thesis that BTC provides exposure to an alternative monetary policy system with supply mechanics that are diametrically opposed to those of central banks in 2020.”

Coinbase’s institutional investors demand deeper capabilities to help them allocate and trade. In response to client demand, the exchange says it is building market-leading brokerage services.

The recent acquisition of Tagomi fits the leading exchange’s plan to bolster “our offerings for advanced traders and the most sophisticated crypto investors.”

Coinbase adds it will continue to invest in leading data analytics businesses through Coinbase Ventures.

By Terence Zimwara

Goldman Sachs has warned that the U.S. dollar may lose its status as the world’s reserve currency. The investment bank is bullish on gold as fears over governments debasing their fiat currencies grow and real interest rates are pushed to all-time lows.

Goldman Sachs’ Dollar and Gold Predictions

American investment bank and financial services company Goldman Sachs warned on Tuesday that the U.S. dollar is at risk of losing its status as the world’s reserve currency. Goldman Sachs’ strategists wrote:

Real concerns around the longevity of the U.S. dollar as a reserve currency have started to emerge.

The strategists explained that the U.S. dollar faces several risks. Citing that the debt level in the U.S. has now exceeded 80% of the country’s gross domestic product, they anticipate that the government and central bank may allow inflation to accelerate.

“The resulting expanded balance sheets and vast money creation spurs debasement fears,” they described, adding that this creates “a greater likelihood that at some time in the future, after economic activity has normalized, there will be incentives for central banks and governments to allow inflation to drift higher to reduce the accumulated debt burden.”

Other factors such as increased political uncertainty and growing concerns of another coronavirus infection spike also impact the dollar.

Meanwhile, the price of gold hit an all-time high on Monday, climbing to $1,931 an ounce, prompting a widespread expectation that $2,000 an ounce could soon be reached. Gold’s record-breaking rally even had Goldman Sachs revise its forecast to $2,300 an ounce in the next 12 months after the firm previously discarded its own forecast of $2,000. Gold is up around 7% over the past month while the ICE U.S. Dollar Index DXY dropped 3.7%.

The Goldman strategists explained:

Gold is the currency of last resort, particularly in an environment like the current one where governments are debasing their fiat currencies and pushing real interest rates to all-time lows.

Bitcoin has also been named a safe haven asset for the current environment. Galaxy Digital CEO Mike Novogratz, for example, believes that with central banks mass printing money, it is “an amazing environment for both being long gold and long bitcoin.”

Even JPMorgan’s analysts wrote in a February report that cryptocurrencies should be in a portfolio “because they can uniquely hedge a yet-unseen environment entailing simultaneous loss of confidence in the domestic currency and its payments system.” Like Goldman Sachs, JPMorgan has also questioned the U.S. dollar’s status as a reserve currency, the company outlined in a report published in October last year.

Bitcoin is currently trading at about $10,978, after crossing the $11K mark the previous day. The cryptocurrency is up approximately 17% since last week and 54% since the beginning of the year.

Do you think the USD will lose its status as the world’s reserve currency? Let us know in the comments section.

By Kevin Helms

C’est un scénario contre lequel certains courtiers en bourse mettent en garde depuis un certain temps: l’élection présidentielle américaine pourrait bien déclencher une tempête sur les marchés. Et le tweet de Donald Trump sur un éventuel report du scrutin ne fait que jeter de l’huile sur le feu.

Bruno Colmant, le CEO de la Banque Degroof Petercam, l’avait déjà évoqué en septembre 2017. Selon lui, il est possible que les élections américaines, prévues pour le 3 novembre, ne se déroulent pas bien, voire pas du tout.

Et il n’est pas le seul à tenir compte des manœuvres non conventionnelles de Donald Trump pour se maintenir au pouvoir. ‘Les ingrédients d’un changement de régime politique sont en place’, a encore prévenu Bruno Colmant au début du mois. ‘Je réponds à mes propres préoccupations en rappelant la résilience d’un système institutionnel qui a surmonté tant de défis, y compris la guerre civile.’

Les démocrates, compte tenu des sondages favorables à leur candidat à la présidence, Joe Biden, seront certainement prêts à utiliser tous les moyens offerts par ce système institutionnel pour permettre aux élections de se dérouler. Car Donald Trump a laissé entendre ouvertement pour la première ce jeudi que le scrutin pourrait être reporté.

Le président actuel a en effet lancé quelques scuds sur le vote par correspondance. Ce système de vote gagne du terrain aux États-Unis, alors que l’épidémie de coronavirus continue à faire rage et qu’elle rendra la tenue de l’élection plus compliquée. Mais Donald Trump affirme que le vote par correspondance ouvre la porte à une fraude massive.

‘Risque de fluctuations importantes’

Selon la banque de Wall Street, Goldman Sachs, les investisseurs devraient de toute manière s’attendre à de fortes fluctuations de prix en novembre-décembre. Les conseillers de Goldman ont mis en garde, dans un mémo envoyé à leurs clients au début du mois, contre ‘un risque accru de volatilité liée aux élections et qui pourrait se poursuivre au-delà du jour du vote’.

Les experts de la banque ont dressé un parallèle avec l’élection présidentielle de 2000 et le duel entre George W. Bush et Al Gore. La bataille des urnes, dans l’importantissime État de Floride, a dégénéré en un recomptage chaotique. Il aura fallu plus d’un mois à Al Gore pour jeter l’éponge. Dans une récente interview à Fox News, le président Trump a reconnu ‘qu’il ne prendrait pas aussi bien sa défaite’.

‘Le tweet de Trump sème le chaos, et le chaos est mauvais pour les marchés boursiers », a estimé Jim Cramer, commentateur boursier de CNBC, dans une première réaction.

Source: BusinessAM

 

By Emmanuel Vanbrussel

Independent researcher Kevin Rooke estimates that Grayscale has ramped up its Bitcoin accumulation to a rate equivalent to 150% of the new BTC created since the halving.

Crypto fund manager Grayscale Investments is accumulating Bitcoin at a rate equivalent to 150% of the new coins created by miners since the May 11 block reward halving.

According to data published by independent crypto researcher Kevin Rooke, Grayscale has added 18,910 BTC to its Bitcoin Investment Trust since the halving, while only 12,337 Bitcoins have been mined since May 11.

Binance CEO Changpeng Zhao reposted the chart, commenting: “There isn’t enough new supply to go around, even for just one guy”.

Grayscale absorbs BTC supply

Last week, Rooke estimated that Grayscale had been buying Bitcoin at a rate equal to between 33% and 34% of new supply during the first quarter of 2020, having accumulated 60,762 BTC over 100 days.

During the quarter, Grayscale also saw average weekly investment into its trust reach $29.9 million — comprising an 800% gain year-over-year.

In response to Rooke’s tweet publishing the figures, Grayscale founder Barry Silbert commented: “just wait until you see Q2.”

Rooke’s latest data indicates that Grayscale is now purchasing nearly double the number of coins per day on average — with Rooke’s post-halving estimate equating to 1,112.35 BTC per day, up from 607.62 BTC during Q1.

Grayscale sounds off on CBDCs

In a recent report published by Grayscale, the firm sought to rebuke analogies comparing Bitcoin to central bank-issued digital currencies (CBDC).

“CBDCs are sometimes viewed as synonymous to, or as replacements for, digital currencies like Bitcoin, but they represent a meaningful departure from the decentralized protocols inherent to many cryptocurrencies,” the report stated.

“CBDCs attempt to upgrade payment infrastructure while Bitcoin is an attempt to upgrade money. If CBDCs gain traction, they may actually bolster the value proposition for Bitcoin and other digital currencies,” Grayscale added.

The report echoed the sentiment of economist John Vaz, who recently told Cointelegraph that CBDCs comprise “a kind of rearguard action being fought by the central banks because they don’t like cryptocurrency”.

“Central bank digital currencies are probably more about tracking money than providing benefit,” Vaz observed.

By SAMUEL HAIG

 

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PayPal développe davantage ses capacités crypto

Le géant des paiements en ligne a déclaré avoir pris des « mesures unilatérales et tangibles » pour développer davantage ses capacités dans la crypto-monnaie.

 

Dans une lettre-réponse faisant suite à une consultation publique de la Commission européenne sur la construction d’un cadre pour les marchés des crypto-actifs, PayPal a expliqué surveiller et évaluer en permanence les développements mondiaux dans le domaine de la crypto et de la blockchain.

La façon dont ces technologies et ces actifs cryptographiques peuvent être utilisés pour atteindre une plus grande inclusion financière et aider à réduire / éliminer certains des problèmes qui existent aujourd’hui dans les services financiers est particulièrement intéressante pour nous. Nous sommes également très intéressés par la façon dont ces technologies peuvent être utilisées pour promouvoir la transparence et renforcer les efforts de conformité,” a écrit la société basée à Palo Alto en Californie.

Le spécialiste des paiements en ligne, qui compte plus de 300 millions de clients dans le monde dont environ 95 millions en Europe, estime qu’une « réglementation réfléchie qui favorise l’innovation tout en favorisant la clarté » pourrait aider l’industrie à croître et prospérer.

À cet égard, PayPal serait favorable à une approche harmonisée sur les marchés de l’UE concernant les exigences de licence ou d’autorisation applicables. Le cadre réglementaire devrait permettre la mise sur le marché de produits et services innovants sans fardeau réglementaire indu tout en fournissant simultanément clarté réglementaire, orientations et garanties,”

PayPal conseille ainsi de créer un ensemble clair de définitions sur diverses activités de cryptographie pour garantir que les entreprises engagées dans de telles activités sont correctement autorisées et réglementées.

Des définitions claires contribueraient également à assurer une protection adéquate des consommateurs et des investisseurs,”

Aussi, l’entreprise américaine pense que les crypto-activités devraient être incluses dans le champ d’application des exigences de lutte contre le blanchiment de capitaux et le financement du terrorisme applicables, tout en tenant compte des spécificités de l’activité concernée.

Enfin, PayPal, qui a rejoint puis rapidement quitté le projet Libra de Facebook, a déclaré qu’il avait depuis « pris des mesures unilatérales et tangibles pour développer davantage ses capacités dans ce secteur ».

Le mois dernier, des sources proches du dossier indiquait que PayPal pourrait permettre à ses clients d’acheter, vendre et stocker des crypto-monnaies d’ici quelques mois.

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Bitcoin Is the Fastest Horse in the Profits Race

Int the world of traditional finance, certain names are used as references. Paul Tudor Jones is one of those whose opinion counts more than others. Managing currently a hedge fund with nearly 40 billion dollars assets, Paul Tudor Jones became a legend on October 19, 1987.

This day corresponds to Black Monday, during which all the world markets experienced a huge correction. During Black Monday, the Dow Jones lost almost 23%. Hardly anyone had seen such a fall coming. No one except Paul Tudor Jones.

Shortly before the crash, Paul Tudor Jones came to the conclusion that Wall Street was heading straight for the wall. Paul Tudor Jones formed this opinion by conducting a thorough technical analysis of the S&P 500, but also by analyzing the historical data of the index.

Since this episode became legendary, Paul Tudor Jones’ opinions have logically been listened carefully.

In the past, Paul Tudor Jones has never been a Bitcoin fan. Far from being as fierce an opponent as Warren Buffett, he confessed that he did not especially want to position himself on Bitcoin due to his lack of confidence in the queen of cryptocurrencies.

Paul Tudor Jones opts for Bitcoin to hedge against the great monetary inflation

The fact that Paul Tudor Jones wasn’t especially keen on buying Bitcoin in the past makes what happened on May 7, 2020 even more interesting.

In a letter to his investors, Paul Tudor Jones made a statement that had the effect of a small bombshell in the world of traditional finance and the Bitcoin world:

“We are witnessing the Great Monetary Inflation — an unprecedented expansion of every form of money unlike anything the developed world has ever seen. The best profit-maximizing strategy is to own the fastest horse. If I am forced to forecast, my bet is it will be Bitcoin.”
— Paul Tudor Jones

Like many other people interested in the world of finance, Paul Tudor Jones is well aware that the Fed’s current policy of unlimited quantitative easing will lead to unprecedented monetary inflation.

In this context, pragmatism must prevail over personal opinions. To maximize profits, a hedge fund manager must find the fastest horse in the race.

Paul Tudor Jones’ decision is pure pragmatism

Faced with the rise of a Bitcoin which is the best performing asset of 2020 against gold or Wall Street, Paul Tudor Jones is convinced that Bitcoin is the fastest horse.

It must be said that with a price close to $10,000, Bitcoin is at +38% since the beginning of the year.

All this while Bitcoin third Halving hasn’t happened yet. And everyone knows that this exceptional event for Bitcoin will cause a very strong bull market in the next 18 to 24 months.

Coupled with the macro economic context made extremely difficult by the coronavirus pandemic, all this leads us to believe that Bitcoin price’s increase will be much more spectacular in the coming months.

His position on Bitcoin was not taken on spot market, but by buying derivatives on Bitcoin Futures.

The rest of Paul Tudor Jones’ letter is also interesting to read, as it confirms that only pragmatism guided his choice :

“I am not a hard-money nor a crypto nut. The most compelling argument for owning Bitcoin is the coming digitization of currency everywhere, accelerated by Covid-19.”
— Paul Tudor Jones

To see such a respected person in the traditional financial world taking a stand for Bitcoin in this way is an extremely bullish signal.

In the coming weeks and months, I am sure that other major hedge fund managers will do the same. This potential entry of large institutional investors into the Bitcoin world is clearly one of the major factors driving Bitcoin beyond the current $10,000 currently.

Bitcoin will replace the role played by gold

The decision taken by Paul Tudor Jones also makes it clear that Bitcoin will increasingly replace gold in the future as a store of value to hedge against currency devaluation.

While Bitcoiners have been certain of Bitcoin’s objective superiority over gold for long time now, Paul Tudor Jones seems to be gradually coming to that conclusion.

The simplest way to verify this is to first look at the evolution of the price of gold during the 1970s:

Gold price evolution over the 70s

Then we can compare all this with the evolution of Bitcoin price over the last five years:

Bitcoin price evolution since 2016

By using a logarithmic scale on each of the two charts, we can actually better understand why the current situation of Bitcoin price reminds Paul Tudor Jones of the gold situation in 1976.

Should the price of Bitcoin experience this trend in the coming months, Paul Tudor Jones will once again have demonstrated his pragmatism and flair that is unparalleled in the financial world.

Until you can check all this out, the best thing to do is not to lose sight of the fact that Bitcoin is well the fastest horse in the race at the moment. Betting against the fastest horse is never a good idea in the race for profits.

By  Sylvain Saurel