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Firms with $27T in assets 😘 crypto 🎯
Top eight US finance firms want to provide clients with exposure to Bitcoin and crypto. Tokenised Teslas round the Web3 curb. China offered BTC bounty to terminate activist? Noodles payment gateway.
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Bitcoin's price is soaring, and it's got the big guns to thank.
BlackRock's move to file for a spot Bitcoin ETF sparked a near 14% surge in Bitcoin's price. Other asset managers are following suit. And Bitcoin's price hit a 2023-high of $31,185.
These institutions are actively working on providing access to Bitcoin and more, and big revelation by CoinShares' Chief Strategy Officer, Meltem Demirors - These institutions combined, have $27 Trillion in their treasure chests.
We've got BlackRock, Fidelity, JP Morgan, Morgan Stanley, Goldman Sachs, BNY Mellon, Invesco, and Bank of America.
Now, don't get too carried away with the $27 Trillion figure. It's an estimate of their total assets under management, and only a tiny portion of that would be dedicated to crypto investments.
The fact check
Bitcoin's market capitalisation is less than $600 Billion, while we're talking about a staggering $25 Trillion in assets under management between HSBC, BlackRock, Fidelity, and Schwab. That's like bringing a tidal wave to a kiddie pool.
With 60% of the investing public in the US holding at least one ETF, there's a big pool of potential investors.
And the 20% of investing Americans who already own cryptocurrency. If they can allocate their long-term savings plans, like 401(k)s, to a Bitcoin ETF, it's perfect. This could bring significant capital into the market, causing a seismic shift.
Sui Chung, the CEO of Kraken-subsidiary CF Benchmarks
"Once you have an ETF, it's only going to have one type of effect. Now what is the magnitude of that effect? We can guess, we can guesstimate. How big is the investing public? How much money have they got to invest? How many of them might be interested in Bitcoin? And when you do that math, the number is pretty big."
Now to make all the dreams come true, how long will this SEC approval process the ETFs take? Well, there's a standard 45-day timeline, but the SEC has the power to extend it not once but twice, stretching it out to a total of 230 days.
“The banks and the financial institutions with capital are always years behind by design because they're risk averse,” David Schwed, COO of Halborn said. “And then once there is any sort of clarity, whether it's coming from the SEC or court systems, they're just gonna jump on that opportunity and create.”
Bitcoin vs. Treasury Yields
Treasure bonds are considered the safest financial product in existence, with the general public holding a staggering $29 Trillion worth of them.
They influence all markets, including Bitcoin and Ether. The cost of capital attributed to US dollars influences loans, mortgages, and even cryptocurrency derivatives.
What happens if the US government defaults on its debt?
Imagine the unthinkable happens, and the US government defaults on its own debt. Chaos ensues! Families, businesses, and countries holding those bonds would be left high and dry, causing a global shortage of US dollars.
Interestingly, cryptocurrencies like Bitcoin have shown potential as a hedge during periods of uncertainty. During the US-China trade war in May 2021, Bitcoin outperformed traditional wealth preservation assets.
High demand for government bonds pushes yields down. Investors seek higher yields if they expect inflation, while they flock to Treasurys for safety during currency devaluation or inflation fears.
The typical inverse correlation between Bitcoin and Treasury yields has gone rogue. In the past 10 days, investors have been buying government bonds like there's no tomorrow, even if the yields are lower than their expectations of inflation.
Who's Gensler protecting?
Now is Gary Gensler putting a damper on the fun for the little guys in favour of Wall Street?
Some enforcement in the crypto industry may be necessary. Get it. There have been some shady characters and fraudulent activities that needed scrutiny. Get that too.
But, and a big one at that.
The recent actions taken by the SEC and other US agencies seem to go beyond just protection. It feels like they're trying to shield the financial services industry from any disruption caused by the crypto revolution.
It's becoming increasingly clear that Gensler is protecting someone, but it's definitely not the American investors who rely on these services. It's not the crypto companies either, as they are forced to relocate to friendlier jurisdictions. It's the Wall Street incumbents, the big players, who feel threatened by the rise of crypto. It's like they're using regulation as a tool to maintain their dominance and keep out the innovative startups.
The SEC's actions speak volumes. They refuse to approve a Bitcoin exchange-traded fund (ETF) while approving futures-backed ETFs that are guaranteed to underperform. They designate stablecoins as securities, limiting their usefulness as payment products. They impose cost-prohibitive regulations on crypto custody, making it difficult for smaller players to participate. And they try to stifle the killer app of self-custody by limiting software offerings to registered broker-dealers.
These actions limit the utility of cryptocurrencies and benefit the Wall Street incumbents who already hold the licenses required for traditional finance. It's a classic case of creating moats to protect established players.
TTD NFT 🐝
Tesla tokens take off
That car-sharing service Eloop, the one based out of Vienna, they've just put a blockchain spin on its fleet. Yeah, they actually tokenised 100 of their Teslas, which means that anyone can own a small slice of their fleet and get a cut of the profits when the cars are rented out.
This whole thing has been made possible thanks to Peaq Network; it's this Web3 ecosystem that handled the tokenisation bit. The bigwigs at Eloop and Peaq reckon that getting blockchain mixed up with tangible stuff like cars is key to getting more people to understand and adopt this tech. And they're not stopping there, they're seeing the potential to branch out into other stuff, like decentralised EV charging and a camera network.
The Big Azuki Sale
That big NFT brand Azuki just scored $38 Million in a crazy quick 15 minutes. They were selling this new Elementals profile picture collection. It was one of those Dutch auction things where everyone got their hands on all 10,000 NFTs, even though the NFT market's been kinda shaky lately. If you already had some Azuki or Beanz NFTs, you even got a head start to grab the Elementals before everyone else.
Since Azuki started out in early 2022, they've raked in over a Billion bucks from trades on the secondary market. And don't get me started on the Beanz collection. Those little guys have already pulled in $276 Million themselves. Seriously, the numbers these NFT things are doing is just bonkers.
TTD Nobody 🏴☠️
There’s a lot of folks who don't know what we're talking about when we say Web3, as revealed by a recent survey conducted by YouGov and Consensys.
Whatcha Talkin’ About, Web3?
This survey was no small feat
It polled over 15,000 peeps across 15 countries.
The pollsters asked 32 questions related to Web3, cryptocurrencies, and our thoughts on the current internet ecosystem.
It took place between April 26 and May 18.
Here's the breakdown of the data
24% of respondents around the globe said they're at least aware of Web3.
Only 8% said they were very familiar with it.
16% reported being somewhat familiar with it.
On the flip side, 37% said they had no clue about it.
About 67% of respondents say they should have more ownership over their online content.
Only 38% feel adequately compensated for anything they produce online.
70% believe users should be sharing in the profits companies make off their data.
A whopping 79% of people want more control over their online identities.
While Web3 might be a mystery, the survey also found that more people are clued in about cryptocurrencies.
A high 92% said they are aware of crypto.
50% profess to understand how they work.
There's a split, however, on how different regions feel about crypto. European countries, Japan, and South Korea are more sceptical, viewing cryptocurrencies as untrustworthy or too speculative.
Meanwhile, African and Latin American countries show a stronger embrace. The perception in these regions is that cryptocurrency is a more stable alternative to their local currencies. But, of course, it varies country by country.
TTD Terminate 🔫
Did you ever think that Bitcoin could be used to set a bounty on someone? Neither did we, until we heard the wild tale of Drew Pavlou, an Australian human rights activist.
The Bounty Buzz: Drew Pavlou has been pretty vocal in his criticism of the Chinese Communist Party (CCP). Imagine his surprise when he alleges a bounty worth a whopping $50,000 in Bitcoin was placed on his family, including his mum, Vanessa.
Emails from "DP Bounty Hunters" were spotted, offering $50,000 to "terminate" Pavlou and his family.
According to Pavlou, these emails were sent to major shopping centers in Brisbane to reach his mother's employer.
While the most recent bounty focused on his mother, Pavlou claims other family members have also been in the crosshairs.
The shocking bounty emails first came into the limelight thanks to a feature on Australian current affairs program 60 Minutes Australia. Pavlou suspects a "mercenary working for the Chinese government" is behind the emails.
Experts believe that using Bitcoin provides a layer of plausible deniability. Max Galka, the founder of Elementus, explains that the "borderless" nature of crypto makes it a popular choice for dodgy dealings. Cryptocurrency transactions can be challenging to track and wallets are pseudonymous, providing anonymity to the owner.
TTD Noodles 🍜
Jack Dorsey recently dropped a link to Nodeless, setting off a flurry of curiosity about this relatively unknown Bitcoin Lightning payment processor.
What is Nodeless?
At its core, Nodeless is a tool that allows merchants to accept Bitcoin payments easily, specifically via the Lightning Network. Bitcoin enthusiasts see the Lightning Network as the key to mainstream adoption due to its ability to facilitate quicker and cheaper transactions.
However, using the Lightning Network non-custodial, meaning without a third party controlling the funds, can be a daunting task for novices. That's where Nodeless comes in, offering a user-friendly solution with a significant twist: it doesn't require users to share identifying information or complete any Know Your Customer (KYC) process to start accepting payments.
How it works: In the Nodeless model, the merchant doesn't need to run their own node. Instead, when a payment is sent to a merchant, it first goes to Nodeless, which then promptly forwards the payment to the merchant's on-chain or Lightning address.
While this model has raised some scepticism regarding potential regulatory pressures, Nodeless' creators are optimistic. They plan to operate from Canada, where transactions under $1,000 don't require KYC, and potentially move to Bitcoin-friendly El Salvador in the long run.
TTD Surfer 🏄
Bank of England says ‘Britcoin’ CBDC might not be on a blockchain, looking at a plethora of options for a CBDC.
Nevada regulators are moving to shut down crypto custodian Prime Trust after finding it owed millions to customers.
Riot Platforms, one of the world’s largest Bitcoin mining companies, has bought 33,280 next-gen miners worth $162.9 Million for its Texas facility.
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The Token Dispatch is a daily newsletter that takes you on a 4-5 minute drive through the wild west of the Crypto World. Daily in your email inbox @13:00 GMT. Almost always.