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| Welcome, bitcoin brainiacs! Here's what's new. |
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Who is Satoshi Nakamoto? (WSJ): Written just two days ago by longtime crypto journalist Paul Vigna, this is a good summary of all the ideas about who Satoshi might be. Investor takeaway: The bitcoin origin story is a powerful driver of BTC's long-term value. Keep HODLing.
Dummies' Guide to The Proposal for EU Regulation on Crypto-Assets (Reddit): An excellent summary of the recent EU proposal to regulate crypto assets. If it becomes law, here's the investor takeaway:
TL;DR: Cryptocurrency will still be the 'Wild West of Finance'; but now there will be a new Sheriff in town. And that Sheriff, is the European Union. It does no longer tolerate unregulated stablecoins; it does no longer tolerate shady projects with no utility, crappy white papers, and misleading marketing; and it sure as hell does no longer tolerate unprofessional exchanges who screw EU citizens out of their money. But it does like innovation and it will try not to hinder development in the cryptocurrency and blockchain space because they have made similar mistakes before in other industries. |
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| Aave is paying out a whopping 27% interest on savings held in USDT and DAI, as opposed to old-school banks which are stuck at a 0.06% interest rate. Click for our list of current DeFi Interest Rates. |
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Hi Everyone,
Yet another ominous strain of COVID-19 has been discovered.
Despite little being known about the omicron variant, and its symptoms being described as "extremely mild" by the doctor who found it, some countries have already taken drastic measures to contain it and financial markets have reacted rather rashly.
For a little-known DeFi protocol, the naming of the new variant held a special significance. Just like Facebook, it seems that the World Health Organization didn't thoroughly research the new name before bestowing it.
In the meme-fueled investment environment where we find ourselves, the native token of the Omicron protocol flew sky high, going from less than $70 on Saturday to a peak of more than $680 early today, before crashing back down. |
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In truth, with small-cap digital currencies like these, it probably didn't take more than one or two investors to get the ball rolling on the pump, and once the joke stopped being funny, the dump was simply unavoidable.
Let's hope that with this last strain, the pandemic is finally coming to a swift end, just like the chart above.
Using the markets as an indicator of humankind's collective emotions, we can tell that the fear of the omicron variant has already subsided.
Global equities are up, bitcoin is up, and we're having a jolly green day in the markets. |
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Don't panic
In all seriousness though, the way the crypto market quickly dived and recovered along with global equities is a bit concerning.
After all, bitcoin has frequently been touted as an uncorrelated asset, so to see it react in line with the stock market during times of stress certainly does put strain on this narrative.
Here we can see bitcoin in orange, compared to the S&P 500 stock market in blue over the last week or so.
We can see rather clearly where the omicron variant concerns started to materialize, and bitcoin followed stocks to fresh lows.
The overexuberant recovery bitcoin experienced once that fear subsided is of little consolation, as we can now see that the digital currency is clearly vulnerable to a stock market panic. |
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There's not too much we can do about it, unfortunately.
With a greater level of institutional participation, we do need to anticipate more integration with traditional markets. Ultimately, this is good for bitcoin.
With best regards, |
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| Mati Greenspan Analysis, Advisory, Money Management |
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| Now that's an interesting take on things! |
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Bitcoin Market Journal is a daily newsletter focusing on blockchain and crypto investments. It is written and edited by Evamarie Augustine, Charles Bovaird, Mati Greenspan, and John Hargrave.
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