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Bitcoin Maintains Stability in the Face of Global Financial Imbalance
The economic measures taken in response to the Covid19 pandemic, coupled with the Russian-Ukrainian conflict and the ensuing energy crisis in Europe, have left the world and global finance upside down. Before 2021, inflation in developed economies was spoken of as an overcome phenomenon, usually oscillating around 2%. Double-digit inflation, like those recorded in the European Union in September, was unthinkable. Today, inflation is the highest since the EU was founded in 1993.
In the case of Europe, which has followed in the footsteps of the Fed by raising interest rates to increase the cost of money, it may soon be necessary to put on the brakes and pull back. This is due to the enormous selling pressure in the European bond market: no one wants to buy European debt, so the UE may have to return to its bond-buying policy to avoid systemic financial problems among the economies of its member countries.
In the midst of all this financial destabilization, one would expect volatile Digital Assets to experience their usual sharp price jumps. In contrast, bitcoin has maintained levels of stability not seen in the last two years (hovering around US$ 20k), matching even Nasdaq in terms of volatility. However, unlike bitcoin, whose price has remained relatively stable, the technology stock index, Nasdaq, has lost 13% of its value at the beginning of September.
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European Union records highest inflation in its history
The European Union reached 10.9% inflation last September, driven by a 4.19% increase in energy prices. This increase comes despite attempts to control inflation by the European Central Bank with a 75 basis point increase in interest rates last September.
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Bitcoin's volatility matches Nasdaq's
Sharp price movements between traditional assets and Digital Assets are catching up, with bitcoin and Nasdaq registering the same volatility over the past 20 days. All in all, bitcoin's price has remained relatively stable since September, while Nasdaq fell 13% in that period.
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Use of stablecoins on the rise in Venezuela and Argentina
The inflationary and capital control context has led residents of Venezuela and Argentina to resort to stablecoins for retail trade. According to the firm Chainalysis, 34% and 31% of the volume of retail transactions in Venezuela and Argentina, respectively, were carried out in stablecoins for the period between July 2021 and June 2022.
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Mastercard to facilitate access to Digital Assets for banks
The credit card giant has partnered with the Paxos platform (currently used by PayPal) to serve as a bridge for banks to offer Digital Assets to their customers, while Mastercard and Paxos provide liquidity and regulatory compliance.
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USDT stablecoin will be available in 24,000 ATMs in Brazil starting in November
The issuer of the USDT stablecoin, Tether, announced the integration of the Digital Asset in 24,000 ATMs in the Carioca country thanks to a partnership with Smartpay.
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Regulation of Digital Assets in Chile only awaits the President's approval
Chile's Financial Innovation Bill is in the "presidential approval process", after being approved by the Chamber of Deputies in September. With this, Digital Assets would begin to be supervised by the Financial Market Commission and the Central Bank.
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BNY Mellon says its Digital Assets offering is driven by client demand
The world's largest custody bank by AUM (US$ 25.08T) admitted that demand from its clients for an institutional-grade Digital Assets service was the main reason for the launch, claiming that 75% of its clients already invest or are considering investing in this asset class.
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European Commission: EU member countries must be ready to block Digital Asset mining
In the context of the energy crisis affecting the European Union due to the Russian-Ukrainian conflict, the Union's executive arm warned member countries that they must be ready to block mining to avoid energy service interruptions, although the presence of mining activity in Europe is considerably low.
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67% of Bitcoin's energy consumption comes from renewable sources, says Mining Council
The Bitcoin Mining Council, organized by Microstrategy founder Michael Saylor, published in its most recent report that 68% of the energy used by the network comes from renewable sources.
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IRS expands its definition of Digital Assets to include NFTs, stablecoins
The U.S. tax authority changed the term used from virtual currencies to Digital Assets to encompass "any digital representation of value recorded in a cryptographically secured distributed ledger," among which it mentions NFTs and stablecoins.
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Israeli government to test digital bond issuance
Israel's Ministry of Finance, in partnership with the Tel Aviv Stock Exchange and Digital Assets firm Fireblocks, will test a new tokenization platform for the exchange and settlement of digital bonds.
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World Gold Council proposes tokenization of the trillion-dollar precious metal market
The market development organization for the gold industry is looking at ways to optimize and make trading in the precious metal more transparent by indexing it on blockchain and tokenizing gold to facilitate its exchange.
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Solidus Capital is the leading firm in Digital Assets, which provides exclusive, agnostic, and institutional services such as Liquidity, Custody Solutions, Wealth (Private Accounts and Portfolio Management), Multi-Strategy Funds, Private Placements, and other sophisticated products in conjunction with bespoke accompaniment to High Net Worth Individuals, Family Offices, Companies, Wealth Managers and Banks.
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By relying on Solidus' services, investors avoid the classic fatal mistakes:
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- Lacking information in the context and moments of the market
- Executing operations inefficiently
- Using unreliable service providers and infrastructure
- Closing of accounts and freezing of funds
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Disclaimer
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