Notes 9/21: FOMC and Bitcoin Price, Retail CBDCs, and Tether In Trouble Again

It was unthinkable some years ago. Fed Day – a day when the Federal Reserve Open Markets Committee (FOMC) meets – is fast becoming an important ritual in bitcoin’s calendar because it determines the cryptocurrency’s future price trajectory. Cryptocurrency markets are poised in anticipation of Fed Chairman Jerome Powell’s announcement his afternoon regarding interest rate hikes. Last month, Chairman Powell indicated that consumers should be … Continue reading Notes 9/21: FOMC and Bitcoin Price, Retail CBDCs, and Tether In Trouble Again

Notes 9/6: The Merge Boosts Ethereum, Binance Provides A Leg Up To USDC

The Merge – Ethereum’s anticipated transition from an energy-intensive Proof-of-Work (PoW) consensus mechanism to Proof-of-Stake (PoS) continues to move markets in cryptocurrency. The Bellatrix Upgrade, initiated on the Ethereum chain this morning, pushed the price of ether, Ethereum’s native token, up by 5% to $164.37 from its price 24 hours ago. On a weekly basis, the price of ether is up by 10%. Momentum for … Continue reading Notes 9/6: The Merge Boosts Ethereum, Binance Provides A Leg Up To USDC

MakerDAO’s Unlikely Evolution

The fun never stops in cryptocurrencies. When they are not tilting at the windmills of a surveillance state, crypto purists are devising methods to escape it. The latest attempt comes from MakerDAO, a lending platform that is also home to Dai, the world’s fourth biggest stablecoin by market capitalization. Rune Christensen, one of its founders, proposed an “endgame” for the stablecoin to convert it into … Continue reading MakerDAO’s Unlikely Evolution

Tether’s Misrepresentations Continue In Its Latest Reserves Report

Controversial stablecoin Tether’s holdings of commercial paper fell and its cash and bank deposit holdings rose, according to “reasonable engagement report” released yesterday. The report provides a breakdown of the reserves backing tokens circulating in the market. Tether claims that its holdings of commercial paper and cash and bank deposits increased by 58% and 32% respectively. [Commercial paper is considered a risky investment because its … Continue reading Tether’s Misrepresentations Continue In Its Latest Reserves Report

Tether Hires New Accounting Firm 

The world’s biggest stablecoin has switched accounting firms again. In an announcement this morning, Tether said it had hired BDO Italia, a subsidiary of BDO Inc., one of the world’s biggest accounting firms, to produce attestations about its reserve holdings – a basket of assets that is used to back up and facilitate quick redemption of Tether tokens. It also said that it was planning … Continue reading Tether Hires New Accounting Firm 

Notes: 1/7: BlockFi Valuation, EU Crypto Regulation, and More CoinFlex Drama

According to reports, lending firm BlockFi is being sold in a fire sale to FTX. The firm, which was seeking a valuation of $5 billion in its previous funding round has a price tag of $25 million now. The reasons for a crash in its valuation are not clear. BlockFi CEO Zac Prince yesterday linked to a podcast he did with Castle Island Ventures last … Continue reading Notes: 1/7: BlockFi Valuation, EU Crypto Regulation, and More CoinFlex Drama

Traditional Hedge Funds Are Shorting Tether. Can They Bring It Down?

According to reports, traditional hedge funds have begun shorting Tether, the world’s biggest stablecoin by market capitalization and transaction volume. Leon Marshall, head of institutional sales at Genesis – a market maker, told the Wall Street Journal that interest from traditional hedge funds in shorting Tether has spiked in recent weeks. There are two reasons for this. First, they believe that the broader macroeconomic slump … Continue reading Traditional Hedge Funds Are Shorting Tether. Can They Bring It Down?

CBDCs Will Drive The Future Monetary System: BIS Report

There goes the dream of decentralization. Bitcoin enthusiasts have railed against central banks since the cryptocurrency was introduced to the world in the aftermath of a global financial crisis, widely blamed on central bank policymaking. But digital currencies issued by central banks, also known as Central Bank Digital Currencies (CBDCs), are at the center of a future monetary system in a report released by the … Continue reading CBDCs Will Drive The Future Monetary System: BIS Report

Will Tether, Crypto’s Biggest Stablecoin, Be Its Next Casualty?

UST. Celsius. Three Arrows Capital. The list of crypto’s casualties in the current downturn is growing by the day. There’s more bad news ahead. Experts say that the crypto ecosystem is due another capitulation event. “Some giant player will go to zero [soon],” Shark tank personality and crypto investor Kevin O’Leary told Coindesk recently. The chances it might be Tether, the world’s biggest stablecoin, are … Continue reading Will Tether, Crypto’s Biggest Stablecoin, Be Its Next Casualty?

Terra’s LUNA Jumps On Debut, Then Crashes

Terra blockchain’s new token LUNA seems to be a chip off the old block. Within hours of debuting this past Friday, the token’s price shot up by 47% to a peak of $19.53. It crashed soon after and reached a low of $3.98 on the same day based on data from Coinmarketcap. As of this writing, it has recovered to trade at $9.16. According to … Continue reading Terra’s LUNA Jumps On Debut, Then Crashes

What Happened to Investors During The UST Crash?

The crash of algorithmic stablecoin UST continues to be a head spinning mess. Many big investors in the Terra blockchain and its native currency Luna claim to have cashed out of their holdings, some for a striking profit. But there doesn’t seem to be much respite for retail investors in the token. Luna, the underlying token responsible for maintaining UST’s peg, is practically worthless. Even … Continue reading What Happened to Investors During The UST Crash?

In The Aftermath of stablecoin UST’s Collapse

It’s yesterday once more in cryptoland. The dizzying rise and rapid fall of algorithmic stablecoin TerraUSD’s (UST) demise brings to mind the initial coin offering (ICO) frenzy of 2017. Back then, all you needed to raise funds from investors was a whitepaper and a generous marketing budget to hype the offering. With the media and crypto enthusiasts cheering on, investors poured money into the empty … Continue reading In The Aftermath of stablecoin UST’s Collapse

Stablecoin Terra’s Peg Continues to Unravel

The unraveling of stablecoin TerraUSD’s (UST) peg to the US dollar continues unabated. As of this writing, it is trading at $0.40, down 23.7% from its price 24 hours ago, according to data from Coinbase. That figure is a far way off from its $1 peg to the US dollar but still represents an improvement from trading lows of 23 cents to the dollar on … Continue reading Stablecoin Terra’s Peg Continues to Unravel

Terra And The Freestanding Algorithmic Stablecoin

A successful algorithmic stablecoin is the Internet equivalent of a freestanding dollar, a currency cut off from its peg to the gold standard. Recent advances in technology and cryptography make the idea sound deceptively simple. Practical implementation, however, remains elusive. Many attempts at creating algorithmic stablecoins have failed in the past. TerraUSD (UST) is the latest example of one such coin teetering on the brink … Continue reading Terra And The Freestanding Algorithmic Stablecoin

Terra Continues Free Fall, Repegging In The Works

Will TerraUSD (UST) become the latest stablecoin to fail? That might be the most important question on the minds of investors in the stablecoin. Terra’s price, which was inching upwards towards its 1:1 peg with the US dollar yesterday, crashed to 26 cents Wednesday morning. Traders also sold off their holdings of Luna – the underlying token responsible for maintaining Terra’s price peg, crashing its … Continue reading Terra Continues Free Fall, Repegging In The Works

Terra (UST) Peg Crisis Deepens

The crisis in algorithmic stablecoin Terra’s peg with the US dollar deepened on Monday evening before staging an overnight recovery. TerraUSD (UST), the world’s third biggest stablecoin, was trading at $0.62 to the dollar yesterday evening based on prices available at Coinbase. As of this writing, the stablecoin’s price has risen to $0.89. The Luna Foundation Guard (LFG) announced yesterday that it was lending out … Continue reading Terra (UST) Peg Crisis Deepens

Questions Swirl After Algorithmic Stablecoin Terra Loses, Regains Price Peg

Not much news takes place in mainstream markets over the weekend because they are closed. But there is always plenty of action in the 24X7 cryptocurrency markets. The latest drama occurred over the past weekend and concerned the price volatility of algorithmic stablecoin Terra or UST. The stablecoin has been a center of news coverage about decentralized finance (DeFi) and cryptocurrencies in the last couple … Continue reading Questions Swirl After Algorithmic Stablecoin Terra Loses, Regains Price Peg

Will Terra’s Bitcoin Bet Work?

Can Bitcoin become a good reserve asset?   Luna Foundation Guard, the folks responsible for building reserves for the Terra (UST) stablecoin, – the world’s third most valuable stablecoin, certainly seem to think so. They recently bought $1.5 billion worth of bitcoin for their reserves. That figure brings the total amount of bitcoin backing the stablecoin to $3.5 billion. The stablecoin was reported to be … Continue reading Will Terra’s Bitcoin Bet Work?

Algorithmic Stablecoins In The Spotlight

Stablecoins are unlikely cryptocurrencies – a bridge between the established world of fiat currencies and its emerging decentralized challengers. Algorithmic stablecoins take that paradigm a step further by eliminating the fiat component and replacing it with token economics on the blockchain. The challenge of creating a free-standing currency to bridge the fiat and crypto worlds has attracted many developers and the number of algorithmic stablecoin … Continue reading Algorithmic Stablecoins In The Spotlight

Tether Launches Stablecoin Pegged To Offshore Chinese Yuan

Tether has launched a stablecoin, or a cryptocurrency whose price is related to that of a fiat currency or a basket of goods, pegged to offshore Chinese yuan. The stablecoin is called CNH₮ and is backed by offshore yuan or yuan traded outside of China. The backing ensures that investors in CNH₮ will be redeemed in case of problems or liquidation. Tether already has three … Continue reading Tether Launches Stablecoin Pegged To Offshore Chinese Yuan

JP Morgan Analysts Highlight Stablecoin Issues

Even as they have proliferated in recent times, stablecoins – cryptoassets that have a stable value with respect to a basket of goods or fiat currencies –  present their set of issues. Analysts from investment bank JP Morgan highlighted some of them in a note to clients. The first problem with stablecoins is that they may not be able to maintain their value during periods … Continue reading JP Morgan Analysts Highlight Stablecoin Issues