Friday, December 8, 2023

The resurgence of crypto

Crypto and bitcoin, among their other uses, are Rorschach tests for commentators. As these institutions evolve, are you capable of changing your mind and updating in response to new data? Sadly, many people are failing that test and instead staking out inflexible ideological ground.

Bitcoin prices are now in the range of $44,000, and the asset has more than doubled in value this year. Perhaps more surprisingly yet, NFT markets are making a comeback. Many of the older NFT purchases remain nearly worthless, but interest in the asset class as a whole has perked up.

These developments should induce us to reevaluate crypto in a positive direction. If in the past you have argued that crypto is a bubble, can it be the bubble is back yet again? Typically bubbles, once they burst, do not return in a few years’ time. You still will find Beanie Babies on eBay, but they are not surrounded by any degree of excitement. Similarly, the prices of Dutch tulip bulbs appear normal and well-behaved, as that bubble faded out long ago. Bitcoin, in contrast, has attracted investor interest anew time and again.

It is time to realize that crypto is more like a lottery ticket than a bubble or a fraud, and it is a lottery ticket with a good chance of paying off. It is a bet on whether it will prove possible to build out crypto infrastructure as a long-term project, integrated with mainstream finance. If that project can succeed, crypto will be worth a lot, probably considerably more than its current price. If not, crypto assets will remain as a means for escaping capital controls and moving money across borders, or perhaps to skirt the law with illegal purchases.

What might such an infrastructure look like? To make just a few guesses, your crypto wallet might be integrated with your Visa and other credit cards (perhaps using AI?). Fidelity, Vanguard, large banks and other mainstream financial institutions will allow you to hold and trade crypto, just as you might now have a money market fund. Crypto-based lending could help you invest in high-return, high-risk overseas opportunities with some subset of your portfolio. Stablecoins will circulate as a form of “programmable money,” and they will circulate on a regular and normal basis; such a plan was just initiated by the French bank SocGen. On a more exotic plane, AI-based agents, denied standard checking accounts, might use crypto to trade with each other.

I’m not arguing such scenarios are either good or bad, simply that the market sees some chance of them happening. And they are far more than “crypto is a fraud or a bubble.”

Whether that infrastructure will meet market and regulatory tests is difficult to forecast. It has never happened before, and thus no one can claim to be a true expert on the matter. Thus your opinion of crypto should be changing each and every day, as you observe fluctuations in market prices and other changes in the objective conditions.

In this perspective, there are some pretty clear reasons why the price of bitcoin is higher again. First, real interest rates have been falling, and fairly rapidly. Ten-year rates are now closer to four per cent than to five per cent. Since crypto financial infrastructure is a long-term project that won’t be completed in a year or two, lower real interest rates raise the value of that project considerably. The value of bitcoin rises as well, just as many other long-term assets rise in value with lower real interest rates. And if interest rates continue to fall, crypto prices could easily continue to rise.

The resurgence of crypto likely has other causes. The story of SBF is receding from the headlines with the end of his trial. That makes crypto look less scammy. On the regulatory side the United States did not try to shut down Binance, in spite of alleged scandals at the exchange. That is the regulators signaling they are not going to try to destroy crypto. Soon the SEC may approve spot bitcoin ETFs, which would make it easier and safer to invest in that asset. Nor have state laws popped up that might be trying to shut down crypto markets. Finally, the election of Donald Trump as President has not faded as a possibility, and in the past Trump has been supportive of crypto. Overall, the tea leaves are signaling that the U.S. government is making its peace with crypto, or at least with some parts of the market.

So with crypto the most important thing is to keep an open mind. As of late, events have been doing much to signal open and growing possibilities, rather than a world where crypto is shut down.

The post The resurgence of crypto appeared first on Marginal REVOLUTION.

      

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Latest filing of prospectus for Ishares Bitcoin trust

Hello. Well, all this talk lately on spot ETF. In particular, blackrocks application. I decided to snoop about and obtained a copy dated 12-04-23. That's the latest date. I make no judgement. People are welcome ro exercise thier free will regarding any investment decision. I just wanted to highlight a particular section. Take it as you will.


Prospective investors should be aware that the Sponsor and the Trustee intend to assert that Shareholders have, by purchasing Shares, consented to the following conflicts of interest in the event of any proceeding alleging that such conflicts violated any duty owed by the Sponsor or the Trustee to the Shareholders.

 

The Sponsor and the Trustee want you to know that there are certain entities with which the Sponsor or the Trustee may have relationships that may give rise to conflicts of interest, or the appearance of conflicts of interest. These entities include the following: affiliates of the Sponsor and the Trustee (including, without limitation, BlackRock, and each of its or their affiliates, directors, partners, trustees, managing members, officers and employees, collectively, the “BlackRock Affiliates”).

 

The activities of the Sponsor, the Trustee and the BlackRock Affiliates in the management of, or their interest in, their own accounts and other accounts they manage, may present conflicts of interest that could disadvantage the Trust and its Shareholders. One or more of the Sponsor, the Trustee or the BlackRock Affiliates provide investment management services to other investment vehicles, funds and discretionary managed accounts that may follow an investment program similar to that of the Trust. The Sponsor, the Trustee and the BlackRock Affiliates collectively are involved worldwide with a broad spectrum of financial services and asset management activities and may engage in the ordinary course of business in activities in which their interests or the interests of their clients may conflict with those of the Trust and its Shareholders. One or more of the Sponsor, the Trustee or the BlackRock Affiliates act or may act as an investor, investment banker, research provider, investment manager, financier, underwriter, advisor, market maker, trader, prime broker, lender, agent and principal, and have other direct and indirect interests, in assets in which the Trust directly and indirectly invest. For example, as of the date of the prospectus, an affiliate of the Sponsor holds a position in bitcoin, initially for purposes of making a seed investment in a private bitcoin trust formed in 2022. Additionally, various funds managed by affiliates of the Sponsor have from time to time held long positions in the CME cash-settled bitcoin futures market. Further, various officers and employees of the Sponsor may hold or have exposures to bitcoin in various degrees given the current state of global adoption of bitcoin.

 

The Trustee has adopted and implemented policies and procedures that are reasonably designed to ensure compliance with applicable law, including a Compliance Manual and Code of Business Conduct and Ethics, which address conflicts of interest (together, the “Policies”). Consistent with the requirements of the Policies, the Trustee will implement standard operating protocols under which personnel who have access to information about creation and redemption activity in Shares of the Trust (“Bitcoin Access Persons”) pre-clear personal trading activity in bitcoin. All of the Sponsor’s employees will be required to preclear personal transactions in the Shares of the Trust. Finally, trading on behalf of clients in the shares of the Trust will be subject to controls embedded in BlackRock’s portfolio compliance systems. The Policies and any underlying procedures will be amended as necessary to reflect these protocols.

 

The Sponsor, the Trustee and the BlackRock Affiliates may participate in transactions related to bitcoin, either for their own account (subject to certain internal employee trading operating practices) or for the account of others, such as clients, and such transactions may occur prior to, during, or after the commencement of this offering. Such transactions may not serve to benefit the Shareholders of the Trust and may have a positive or negative effect on the value of the bitcoin held by the Trust and, consequently, on the market value of bitcoin.

 

Because these parties may trade bitcoin for their own accounts at the same time as the Trust, prospective Shareholders should be aware that such persons may take positions in bitcoin which are opposite, or ahead of, the positions taken for the Trust. There can be no assurance that any of the foregoing will not have an adverse effect on the performance of the Trust.

 

Thus, it is likely that the Trust will have multiple business relationships with and will engage in transactions with or obtain services from entities for which the Sponsor, the Trustee or an Affiliate performs or seeks to perform investment banking or other services.

 

BlackRock expects to receive compensation from an affiliate of the Bitcoin Custodian for BlackRock’s technology support of such affiliate’s enhanced integration with the Aladdin Platform, and a portion of such compensation may be based on the use of such affiliate’s products and services by Aladdin clients.

TLDR: Not your keys, not your Bitcoin. Have a nice day.


GME Utilization via Ortex - 93.32%

https://www.reddit.com/gallery/18dwqa6

🚀 VanEck Predicts Exciting Developments for Bitcoin in 2024! 🌐💰

VanEck, the asset manager, just dropped some bold predictions for 2024, and it's making waves in the crypto world. Here's the scoop in a nutshell:

📈 Bitcoin's All-Time High: VanEck forecasts that Bitcoin, currently at $43,151, will skyrocket to new all-time highs in late 2024. Why? They're pointing to a potential U.S. recession and regulatory shifts post the 2024 U.S. presidential election.

💼 Spot Bitcoin ETF Approval: VanEck is confident that the first spot Bitcoin ETFs will get the green light in Q1 2024. They predict a whopping $2.4 billion flowing into these ETFs in the first quarter to give Bitcoin's price a solid boost.

🔮 Bitcoin Halving: The BTC halving expected in April or May? According to VanEck, it won't cause major market disruption. In fact, they foresee a post-halving price surge.

🗳️ Political Events and Regulatory Shifts: VanEck believes that Bitcoin's all-time high in Q4 2024 could be linked to political events and regulatory changes post the U.S. presidential election scheduled for Nov. 5, 2024.

Exciting times ahead for the crypto space! What are your thoughts on these predictions? 🚀🤔 #Bitcoin2024 #CryptoPredictions #VanEckInsights


🚀 VanEck Predicts Exciting Developments for Bitcoin in 2024! 🌐💰

VanEck, the asset manager, just dropped some bold predictions for 2024, and it's making waves in the crypto world. Here's the scoop in a nutshell:

📈 Bitcoin's All-Time High: VanEck forecasts that Bitcoin, currently at $43,151, will skyrocket to new all-time highs in late 2024. Why? They're pointing to a potential U.S. recession and regulatory shifts post the 2024 U.S. presidential election.

💼 Spot Bitcoin ETF Approval: VanEck is confident that the first spot Bitcoin ETFs will get the green light in Q1 2024. They predict a whopping $2.4 billion flowing into these ETFs in the first quarter to give Bitcoin's price a solid boost.

🔮 Bitcoin Halving: The BTC halving expected in April or May? According to VanEck, it won't cause major market disruption. In fact, they foresee a post-halving price surge.

🗳️ Political Events and Regulatory Shifts: VanEck believes that Bitcoin's all-time high in Q4 2024 could be linked to political events and regulatory changes post the U.S. presidential election scheduled for Nov. 5, 2024.

Exciting times ahead for the crypto space! What are your thoughts on these predictions? 🚀🤔 #Bitcoin2024 #CryptoPredictions #VanEckInsights