AngelList to Roll Out “Several Crypto-first Features,” Starting with USDC Enabled Funds

AngelList to Roll Out “Several Crypto-first Features” Across the Platform, Starting with USDC Enabled Funds

This week, AngelList introduced USDC enabled funds.

The website for startups, angel investors, and job-seekers will now allow investors to invest in any USDC-enabled syndicate or fund through the stablecoin USDC.

The process to invest via USDC is pretty simple as in the closing flow, there will just be a different option; rather than ACH or wire, there’ll be USDC. The investor has to just click on the USDC option, scan the QR code or copy the Ether address to send the crypto asset from their wallet.

USDC, however, is just the beginning, as shared by CEO Avlok Kohli & co-founder Naval Ravikant in an AngelList Confidential 2021 Keynote on Wednesday.

“This is just the beginning of several crypto-first features that we’re actually going to be rolling out across AngelList.”

USDC is a rapidly growing second-largest stablecoin with a market cap of $31.2 billion, which has captured 24.6% of the stablecoin market share, up from 4.34% a year back.

“Super excited to partner w AngelList on one of the fastest-growing methods of startup funding and eventually treasury operations,” said Jeremy Allaire, Co-founder & CEO of Circle, which formed a consortium called Center with Coinbase to launch the stablecoin USDC.

The same day, the company also launched a new suite of products called AngelList Stack that will help founders start, operate and maintain ownership over their companies. The new software will cover end-to-end incorporation, business banking, advisor equity grants, and cap table management.

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Author: AnTy

Europeans Favor National Cryptocurrency Regulation: Survey

EU citizens are getting around to crypto regulation, with several respondents noting that they would prefer national regulation of the nascent industry to an EU intervention.

Free from the European Union

A recent survey has shown that more European citizens would like their countries’ financial regulators to provide more clarity on digital assets sooner rather than later.

The survey in question was conducted by Redfield & Wilton Strategies – a Market research company based in London. The company took responses from citizens in 12 European countries, including France, Germany, Greece, Estonia, Italy, and Lithuania.

The survey also sought to gauge public opinions about a possible national digital currency and the prospects of crypto regulations across the continent.

Among the countries, respondents from Italy showed the highest support for a state-backed digital currency, with 41% of respondents giving the green light. Greece followed this with 40% and Estonia with 39%.

The Netherlands had the highest number of respondents against this plan, with 37% clearly against the idea as opposed to 18% in favor.

Interestingly, the survey also showed that most respondents would prefer their countries to develop cryptocurrency regulations instead of waiting on the European Union.

Since September 2020, the European Commission has been working towards providing a uniform approach to crypto regulations across the continent. In a regulatory proposal titled “Markets in Crypto Assets,” the agency explained that it had seen the need to ensure closer crypto regulations across Europe.

The European Commission based its approach on two reasons. The first was to prevent the rise of fragmented regulations across European countries, while the second was to stem the rising tide of stablecoins.

So far, the proposal has been subject to intense debates, with several bodies raising concerns over its implications for growth in the crypto market and beyond. However, this latest poll could serve as a signal that the region is ripe for crypto regulation.

Slovenia’s New Crypto Tax Revamp

Some countries have already begun taking bold steps towards regulating the highly volatile asset class. Earlier this week, the Financial Administration of the Republic of Slovenia (FURS) reportedly began considering imposing a 10% taxable income fee on crypto earnings.

Local news sources stated that the current taxation scheme in Slovenia involves the agency analyzing citizens’ digital asset activities on a case-by-case basis, even as far as examining their transactions. But, with a proportional taxation system, the agency can now streamline the process and focus only on crypto-based purchases as well as crypto-fiat conversions. Using these parameters, individuals will have to pay a 10% tax rate on their crypto earnings.

“We would like to emphasize that it is not profit which would be taxed but rather the amount a Slovenian tax resident receives on their bank account on turning the virtual currency into cash or when buying a thing,” the report added.

While the tax rate is yet to take hold, regulators and policymakers are probably already discussing the possibility.

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Author: Jimmy Aki

Largest Korean Exchange Upbit Goes on a Delisting Spree Ahead of New Regulation

Upbit, the largest cryptocurrency exchange in South Korea, is removing several cryptocurrencies from its platform.

The exchange announced the removal of the KRW market pair of MARO, Paycoin (PCI), Observer (OBSR), Solvecare (SOLVE), and Quiz Talk (QTCON) on Friday.

MARO/KRW, PCI/KRW, OBSR/KRW, SOLVE/KRW, and QTCON/KRW pairs will no longer be available for trading after June 18, 12 PM (KST).

While BTC pairs won’t be affected, the exchange would not support the trading for GBP against these crypto assets either.

The exchange cited failure to meet internal standards for maintaining the KRW market pair as the reason for the removal.

The same day, the exchange flagged 25 crypto assets with an “investment warning.” These cryptocurrencies include Komodo (KMD), ADX, LBRY Credit (LBC), Ignis, D-Market (DMT), Einsteinium (EMC2), Twelve Ships (TSHP), Lambda (LAMB), Endor (EDR), Pixel (PXL), PICA, Red Coin (RDD), RINGX, Byte Token (VITE), ITAM, Syscoin (SYS), BASIC, NXT, BFT Token (BFT), Nucleus Vision (NCASH), Fusion (FSN), Flian (PI), Ripio Credit Network (RCN), PRO, and Aragon (ANT).

Business and team competency, public disclosure of information and communication, technical competence, and global liquidity for investor protection are the reasons given by the exchange for the investment warning.

Upbit will conduct a detailed review of these digital assets for a week to determine whether these cryptos should be delisted. The exchange said,

“If the reason for designation of a significant item is not fully clarified during the clarification period, Upbit will notify the end of the transaction support through a separate notice, and the exact transaction support end schedule will be announced through the transaction support termination notice.”

Cryptos designated as items of concern cannot be deposited after the time this notice is posted, added the exchange.

“Korean traders are calling it “Bloody Friday,” said DooWanNam, co-founder of StableNode and working with DeFi project MakerDAO. He further shared that this move is taken by Upbit because “the new regulation is incoming and it penalizes exchanges for having too many coins, especially shady ones.”

Additionally, there are rumors that “the exchange is watching the Financial Services Commission and is taking action against a project with conflict of interests.”

According to DooWanNam, these 25 cryptos flagged are “most likely” to be removed while noting some of these coins are popular Korean natives with high volume. He said,

“Many of them only have Upbit as the major exchange (or for some only exchange), so it will be for sure death unless they find an alternative exchange. Likely global ones this time.”

“While this will be bad for Korean coins, it can turn out to be good news for global retail coins like ADA and XRP.”

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Author: AnTy

Institutional Investors Shift Interest to Ether But Bitcoin Fundamental Shows ‘Healthy Bull Market’

On CME, Ether futures volume and OI is up 50-60%, while for Bitcoin, it is declining. Still, several metrics show that people are not preparing to sell their BTC and have “longer-term conviction” in the trillion-dollar crypto asset.

Institutional investors seem to be more interested in Ether right now than Bitcoin.

Ether futures had a record volume day this week, trading $228 million in volume, as per Skew. It is a relatively new product as CME Group launched Ether future just a few months back on Feb. 8.

Despite these good numbers, Ether futures are only catching up to the underlying spot volume.

According to the March report of CryptoCompare, in terms of total USD trading volume, CME’s newly launched ETH futures reached $1.5 billion in March, up 51.3% since February. Meanwhile, BTC futures volume on CME has decreased by 0.5% to $59.4 billion.

About ten days ago, at the announcement to the upcoming CME micro Bitcoin futures, Tim McCourt shared that since the Ether futures launch, they have seen 767 contracts, equivalent to 38,400 Ether, trading on average each day compared to 13,800 contracts equivalent to about 69,000 BTC in 2021.

Much like volume, open interest is also on the surge, with ETH OI averaging $102 million, up 66.2%, in March on CME, and currently, at $187 million. As for Bitcoin, traders err on the side of caution, with OI dropping by 15% to $2.1 billion last month.

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Average open interest for March was down 14.1% from Feb. across all futures derivatives products at $25.9bn. Binance, however, recorded a 1.5% increase and the highest open interest on average at $7.5bn.

The OI shifted lower as the price of Bitcoin remains stuck under $60k while Ether’s is trading above $2k, hitting a new ATH at $2,050 last weekend.

Despite the lack of movement in price, bitcoin fundamentals paint a healthy and bullish picture, as noted by Yassine Elmandjra, an analyst at ARK investment and on-chain analyst David Puell in “Buyer and Seller Behavior: Analyzing Bitcoin’s Fundamentals.”

One of the metrics, Thermo Capitalization, which is the total USD value of coins paid to miners, is at $23 billion, nearly 98% below bitcoin’s market cap, indicating that “miners no longer dominate as natural sellers.”

Another metrics is “HODL” waves shows that today, roughly 55% of bitcoin’s supply hasn’t moved in more than a year, illustrating investors’ longer-term conviction in the crypto asset.

The largest crypto asset, Bitcoin achieved a trillion-dollar market cap this year for the first time, however, realized market cap, which values each BTC at the price of its last move, is at $350 billion.

“Whenever market cap drops below realized cap, the overall bitcoin market sells at a loss, denoting capitulation,” noted Elmandjra and Puell.

Another bullish metric is coindays destroyed, an increase of which implies that holders are moving coins out of long-term storage and taking profits.

The metrics measure the time-weighted turnover of bitcoin and is currently slightly above 5 billion, still 30% below its all-time high in early 2018 in spite of the price tripling its 2017 ATH, depicting “a healthy bull market.”

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Author: AnTy

Bitcoin Is Weathering A Lot of FUD This Week; What’s the Market Saying?

This week, Bitcoin is fighting several ‘fear, uncertainty, and doubt’ all at the same time.

The week started on a red note, as the price of the digital asset declined by 28.5%, and the market got a buy the dip opportunity. On the downside, $30k is of importance, whose breach could trigger “could trigger a much sharper correction.”

However, it didn’t take long for BTC to recover, and we were back at $40,000 in the middle of the week.

Now, into the weekend, Bitcoin is holding around $37,000 BTC -0.43% Bitcoin / USD BTCUSD $ 36,130.40
-$155.36-0.43%
Volume 57.14 b Change -$155.36 Open $36,130.40 Circulating 18.6 m Market Cap 672.11 b
7 h Kraken Halts XRP Trading; DOT Replaces the Digital Asset as 4th Largest Crypto Asset 8 h Bitcoin Is Weathering A Lot of FUD This Week; What’s the Market Saying? 1 d Bitcoin Donations Made to Those Involved in Capitol Riot a Month Prior: Chainalysis Report
, taking a breather and giving altcoins the chance to rally.

Nothing Stopping it from Going to zero

While the broad crypto market is enjoying an uptrend, Bitcoin is weathering a lot of skepticism and the same old FUD.

First, the UK financial watchdog issued its stapled investment warning that customers investing in cryptocurrencies should be ready to lose everything.

”Cryptocurrencies are not sustainable,” chimed in Peter Branner, the CIO at APG Asset Management. “Bitcoin is not backed by a central bank. It only has a value if people gives it value.”

Even UBS Global Wealth Management is taking inspiration from the Financial Conduct Authority (FCA) issuing a warning of losing all your money.

“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,” authors including Michael Bolliger, the chief investment officer for global emerging markets, said in a report Thursday in response to rising client interest.

While in the short-term, institutional adoption, limited supply, and market momentum can prop up the prices, regulatory intervention is a risk in the long term, the strategists wrote, citing the UK banning crypto derivatives. UBS Wealth said,

“Investors in cryptocurrencies must therefore limit the size of their investments to an amount they can afford to lose.”

Renewed Interest

When this wasn’t enough, the market itself found some FUD to keep things interesting. Mt. Gox saga renewed with CoinLab making a deal so that creditors can claim 90% of BTC owed to the exchange.

But while there is only 0.23 BTC available to every Bitcoin the creditors lay claim to, the users have been waiting for 7 years with nothing so far. Though it “should be bearish news short term,” the rehabilitation plan deadline has been postponed several times.

Amidst this, whether Tether is 100% backed remains a constant presence in the market, which only got heavy with Deltec Bank announcing that they hold a large position in Bitcoin for their clients, which Tether says has nothing to do with them.

“The amount of USDT printed by Tether is dwarfed by the amount of USD printed by the state,” argues Balaji S. Srinivasan, and that even if USDT fails, bitcoin has seen several 80% to 90% drawdowns, and there are other stablecoins available with long term people here to “advance freedom, privacy, and decentralization (and) that doesn’t change.”

But while the FUD created some uncertainty, there has been just as any good news. Grayscale is back to buying Bitcoin with an increasing premium for starters — presenting $23k as “a strong floor.”

Goldman Sachs is now also looking to invest in digital assets. The report came after Anchorage became the first crypto firm to win a charter from the Office of the Comptroller of the Currency, whose big official called for regulators to be ready for DeFi — self-driving banks.

Not to mention the big stimulus coming, USD weakness, Fed Chairman informing that they have no plans to increase rates or stop asset-buying anytime soon, the macro environment is also in favor of BTC.

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Author: AnTy

Bitcoin Is Ready to Welcome The New Year With Blast; Chance Of A Pullback?

Several factors point to an upcoming correction, what will be instructive for next year’s flows would be whether institutions “buy on a potential dip.”

Bitcoin vaulted above $29,000 to hit yet another record high with just one day left to end 2020. But it is showing no signs of slowing down its crazy December rally that has it up over 50% this month.

The digital asset climbed as high as $29,275 before pulling back to $28,045 but is now just above $28k.

And with these gains came over $540 billion market cap which helped Bitcoin flip its skeptic Warren Buffett’s Berkshire Hathaway and become the 10th largest asset by market capitalization.

Interestingly, while volume on Wall Street is winding down due to the holidays, crypto volumes are seeing record-breaking levels.

As Paul Vigna, a reporter at the Wall Street Journal noted, in his 3-decade experience covering financial markets, he has “never seen a group of people so insanely bullish on a specific asset class.”

This latest uptick in BTC price coincided with increased stablecoin deposits on crypto exchanges. However, such transactions are now decreasing.

A Potential Dip

Bitcoin has been going strong ever since the March sell-off and since then we have yet to see any meaningful pullback.

“BTC would have a correction when the spot inflow of institutional investors slows down,” says Ki-Young Jo, CEO of data provider CryptoQuant. He noted that Grayscale hasn’t purchased any BTC since Dec. 25. Also, we haven’t had significant Coinbase outflows since last week.

The relative strength indicator is also flashing red, putting the digital asset into overbought territory, suggesting the coin is “close to a top.”

“Key to this rally is that it has been sustained over several weeks,” said Matt Long, head of distribution and prime products with crypto brokerage OSL in Hong Kong. “If we do see a break to the downside, it will be instructive on the direction of first-quarter flows whether we see institutions continue to buy on a potential dip.”

The market has long been anticipating a correction that is yet to be seen. In the light of strong demand for Bitcoin, experts believe it won’t be as deep, 30% to 40%, as we saw during the 2017 bull run but less than half of that and even that would be quickly scooped off.

“My sense is we’re very close to a top — we could hit $30,000 though,” said Vijay Ayyar, head of business development with crypto exchange Luno in Singapore. “We should definitely see a pullback, but the magnitude is probably lesser. We might only see 10% to 15% drops.”

According to Ayyar, a lot of things have been validated this year, and “Bitcoin is now a real alternative.”

Regulatory Worries

Regulators are also keeping things slightly uncertain. After the SEC sued Ripple Labs and its top executives for allegedly selling unregistered security XRP, it has been speculated that they are “sniffing around a number of projects and companies.”

The market can see the biggest hit if a stablecoin like the dominant USDT gets targeted. And although some may feel so, “Tether is registered and regulated under FinCEN as all the centralized competitors. Strict KYC/AML is applied to all Tether direct users, as the other main issuers are doing. Less regulated is just FUD,” clarified Paolo Ardoino, CTO at Tether and Bitfinex.

When it comes to Tether, the “SEC isn’t the agency to be worried about,” said Jake Chaervinksy, General Counsel at Compound Finance. The NYAG is already pursuing Tether in a Martin Act investigation, He said earlier this week that the handover of loan documents will be completed in “the coming weeks.”

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Author: AnTy

Bitcoin’s Rising Popularity Not an ‘Existential Threat’ to Gold’s Last Resort Status

Amidst the wild bull rally of 2020, several mainstream firms have commented on Bitcoin’s ability to outdo gold in the long term. In its recent report, JPMorgan also said that if Bitcoin continues to see the institutional adoption it is seeing, which has just “begun,” gold can “suffer” over the coming years.

However, according to Goldman Sachs Group, Bitcoin and gold can coexist despite the largest digital currency pinching some demand from the traditional safe haven asset. The bank said in a note,

“Gold’s recent underperformance versus real rates and the dollar has left some investors concerned that Bitcoin is replacing gold as the inflation hedge of choice.”

While the banking giant noted that there’d been some substitution, “we do not see Bitcoin’s rising popularity as an existential threat to gold’s status as the currency of last resort,” it added.

As we reported, Bitcoin flows have been increasing massively thanks to the cryptocurrency’s more than 210% rally this year. Meanwhile, the world’s largest gold ETF recorded the most significant outflow last month has not recorded any inflows. Goldman said,

“We do not see evidence that Bitcoin’s rally is cannibalizing gold’s bull market and believe the two can coexist.”

Dan Tapiero, co-founder-10T Holdings, a supporter of both Bitcoin and gold, agrees with Goldman Sachs and that there are not enough stores of value available for investors. He said,

“Non-financial market people do not understand that we have an overall SHORTAGE of stores of value available in the markets.”

“GOLD not losing its SOV premium any time soon, unlikely in my LIFETIME.”

According to Goldman, wealthy and institutional investors avoid digital assets due to “transparency issues,” and “speculative retail investment causes Bitcoin to act as an excessively risky asset.”

According to Jeff Currie, head of commodities research at Goldman Sachs, “Bitcoin is the retail inflation hedge.”

In an interview with Bloomberg, Currie said it is the copper chart that looks “similar” to Bitcoin, and what they have in common is they both are “risk-on growth proxies.”

He further added that gold remains a “defensive asset” and “there’s really no evidence” that Bitcoin hasn’t stolen demand from the precious metal.

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Author: AnTy

Mt Gox Trustee Submits Rehabilitation Plan; 150,000 Bitcoin to Be Returned to Traders

After several consecutive delays, Mt. Gox users could finally get paid after the trustee submitted a draft rehabilitation plan.

Nobuaki Kobayashi, Mt. Gox trustee, submitted the draft rehabilitation plan on Tuesday, Dec. 15. The draft plan promises to repay the former Mt. Gox creditors using Bitcoin. The rehabilitation plan, which has since been posted on the Mt. Gox website, reveals that the trustee is set to return about 150,000 Bitcoin worth approximately $2.6 billion to the former Mt. Gox users. The announcement reads,

“The Tokyo District Court and an examiner will review the draft rehabilitation plan and determine whether to proceed with the rehabilitation proceedings relevant to the draft rehabilitation plan.”

This indicates that the draft rehabilitation plan is currently being reviewed. If the Tokyo District Court okays the plan, then the trustee will repay the money to the creditors within a specified timeframe.

The move comes months after Kobayashi was given another approval extending the date of filing a rehabilitation plan back in October this year. Kobayashi had been given until Dec. 15, 2020, to file the draft rehabilitation plan. The trustee had previously been given several such deadline extensions in April 2019 as well as march 2020.

Mt. Gox was founded in 2010 and arguably underwent the greatest crypto heist in history. The crypto exchange was hacked on two separate occasions in 2011 and 2011, leading to a loss of about 1.35 million Bitcoin. The second hacking led to the exchange’s closure, which catered for about 70% of the total Bitcoin transactions.

Mt. Gox users are yet to receive any management compensation, leading to multiple cases to trace the perpetrators and retrieve the stolen funds.

The Tokyo-based court appointed a Japanese lawyer, Kobayashi, to manage the civil reimbursement process and allegedly has about 150,000 BTC to refund the users. The rehabilitation process is expected to end a protracted legal battle involving the regulators and users.

Mt. Gox is the recent defunct crypto exchange for making positive progress in reimbursement plans. Cryptopia began reimbursements to its users on Dec. 9 after the exchange was hacked last year.

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Author: Joseph Kibe

Fidelity Digital Assets Dives Into Why Institutions Are Adding Bitcoin to Treasury Reserves

Over the year, several companies have chosen to add Bitcoin to their Treasury reserves, including MicroStrategy, Square Inc., and Tudor Investment Corporation. The latest two, Canada-based BIGG Digital Assets and MassMutual, a 169-year old insurance firm, also added $3.6 million and $100 million in BTC to their reserves in 2020, respectively.

As one of the first institutional investment-focused firms on Bitcoin, Fidelity Digital Assets released a synthesis report on the growing number of institutions adding BTC as a treasury reserve asset – and crucially, why more companies will consider adding Bitcoin-backed treasuries in the future.

From August through October, a billion-dollar publicly traded firm, MicroStrategy, added over 40,000 Bitcoin for $475 million into its Treasury coffers. Less than three months later, Michael Saylor, MicroStrategy’s CEO, announced a doubled down bet on BTC selling $635 million of senior convertible notes to purchase the ‘digital gold.’

The huge bet paid off wonderfully across Q4 2020 for MicroStrategy’s stock (MSTR), which reached a 20-year high after the firm recorded over 50% profit on its BTC Treasury reserves. Despite CITI Bank downgrading its stock from “neutral” to “sell” in their latest report (due to “disproportionate focus on BTC), the firm looks to add even more, Saylor confirmed.

Additionally, Square Inc., founded by Twitter CEO and Bitcoin enthusiast Jack Dorsey, introduced BTC buying and selling through Cash App earlier in the year. The payments firm purchased $50 million worth of bitcoin (or 4,709 bitcoins) in October 2020, representing 1% of their Treasury reserve.

Other institutions such as Stone Ridge, Mode Global Holdings PLC, and Tudor Investment Corporation have also announced Bitcoin allocations this year.

So what is causing a sudden increase in corporations adopting Bitcoin-backed Treasury reserves?

Damaged financials, cash flows, and profitability

According to the report, three main issues affect a corporation’s decision to hold BTC in its reserves. First, the global COVID-19 pandemic “damaged corporate balance sheets, cash flows, and profitability,” which put most corporations in a precarious position. The sudden reduction in cash flows raises the importance for these institutions to put away excess cash in uncorrelated investments to fight off the recession.

Bitcoin is well-diversified from the demand shocks that health and economic crises cause on stocks, bonds, and traditional finance markets. The report further states,

“Companies may also benefit from bitcoin’s diversification benefits, potential outperformance, and liquidity profile when the core business and other potential investments are disadvantaged by the state of the economy”.

Moreover, BTC offers companies the potential of a longer-term investment profile while also offering liquidity to shorter-term investors. This will help companies maintain their liquidity while diversifying their investments, providing a buffer in difficult times.

Ultra-low interest rates across the world

Secondly, interest rates across the world reached yearly lows as the pandemic struck to stimulate borrowing. However, while corporations may rejoice in having a cheaper leeway for acquiring debt or refinancing existing debt at lower rates, companies with excess cash reserves may suffer as they cannot find attractive rates, the report explains.

While safe-haven assets like gold and Bitcoin generally do not generate interest yields, having these assets in your portfolio prevents cash-filed companies from avoiding negative or ultra-low interest rates, the report also states.

Inflation strikes

Finally, there has been an increase in monetary and fiscal policies globally, with money printing reaching “unprecedented levels.” McKinsey’s report showed that the top 54 economies contributing to 93% of global GDP made over $10 trillion in stimulus payments in two months – over three times more than the 2008 financial crisis. This unchecked and unbalanced economic stimulus could cause a sudden hike in asset and consumer price inflation leading to corporations having less purchasing power with cash.

Bitcoin offers a verifiable and inelastic monetary supply, which differs from the expansive monetary and fiscal currently being broadcast globally. Some companies view BTC as a wealth preserving asset that could prevent inflation risk and store value.

The entry of MicroStrategy, Home Ridge, Square Inc., and Tudor Investment Corporation signals a start of the institutional investment wave in Bitcoin – and who can predict how far it can go?

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Author: Lujan Odera

Gold Investor Forecasts Continued Bullish Rally for Bitcoin and Ether in 2021

While 2020 has already proven to be a stellar year for several large-cap cryptos, some analysts are already predicting what 2021 might look like.

Major gold bug Frank Holmes has given his prediction on Bitcoin and Ether. He believes both digital assets could do much better in the new year as they capitalize on 2020’s performance.

Increased Investor Interest and a DeFi Boom

Holmes is the chief executive of U.S. Global Advisors, a Texas-based asset management firm. Speaking with Kitco News, Holmes explained that he expects digital assets to notch improved performances in 2021 along with gold. He argued that the leading cryptocurrencies had seen growth in their underlying value drivers, leading to higher adoption and price gains.

Speaking on Bitcoin, Holmes explained that the asset is seeing greater adoption. He noted the increase in the number of new wallets, maintaining what seems to be a three-year trend. However, while many have pointed to an influx of institutional investment as to why Bitcoin is surging, the gold bug attributes the rally to the halving event.

As he pointed out, a comparable halving event in the gold market could see the asset rise to $10,000 an ounce. He added that the halving had affected the supply of the asset. Joined by the quick adoption by institutions (which have a penchant for absorbing Bitcoin in large numbers), Bitcoin’s demand has grown significantly, leading to a jump in value.

Moving to Ether, Holmes highlighted that the asset had enjoyed most of its 2020 rally from the decentralized finance (DeFi) boom. DeFi Pulse shows that the total value locked in DeFi projects is at an all-time high of $14 billion. Since much of DeFi activity is done on the Ethereum blockchain, the network is seeing new usage. That will undoubtedly increase Ether’s value in the future.

Holmes further predicted that continued growth in the DeFi market would help Ether going into 2021. The investor predicted a “two-standard deviation” to occur to the asset in the next few months on gold. Estimating the occurrence’s effects, he claimed that gold could hit $2,600 an ounce before 2021 draws to a close.

Not Drawing Comparisons

Holmes refrained from speaking on Bitcoin’s potential to displace gold as the global reserve currency that many believe could happen in the next decade.

A recent Bloomberg piece explained that several Wall Street stalwarts had begun debating Bitcoin’s potential to usurp gold as the global reserve currency. Bitcoin had gotten support from names like Paul Tudor Jones and Stanley Druckenmiller. Several large investment firms are even considering moving large chunks of their portfolios into BTC.

Bitcoin’s market cap is still a paltry $346 billion compared to gold’s $2.6 trillion. However, continued growth in the asset’s investor base should force a considerable change.

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Author: Jimmy Aki