What’s going on in the Crypto Sphere?
In this week’s edition Sune Hojgaard Sorensen, our Managing Director, takes a look at what’s been happening in the fast-evolving Crypto Sphere recently.
The crypto market has experienced tremendous success but has undergone price corrections throughout the last decade, we have seen this again in recent months. Innovation at the cutting edge of technology in a highly regulated space can be a rollercoaster ride for all involved – entrepreneurs, investors and regulators.
Asia, Europe and the US will look to seize opportunities related to the development and deployment of the innovation in the crypto sphere for the sake of demonstrating technological competence in the 21st century. In Europe Bitcoin and Ethereum ETPs have appeared on the Euronext Paris stock exchange.
Modernization offers transparent communication systems with electromagnetic waves, towers, and cords that offer portals for transcending borders, but the world’s two largest economies are not going to let that happen without oversight and some measures of control. The US-China strategic competition will influence crypto policies for both countries. The Chinese have pushed cryptocurrency businesses out. Ransomware attacks demanding bitcoin have been compared to 9/11 by FBI Director Christopher Wray. The Biden administration has announced a memorandum on establishing the fight against corruption as a national security interest. The US Department of Justice has seized $2.3 million in bitcoin from Colonial Pipeline’s hackers DarkSide. Technology is a tool – like a hammer it can be used to build a house or to tear it down. With clear rules of the road the innovation unfolding in the crypto sphere can be the springboard for change to a better financial system.
Is it possible to ignore the bumps on crypto’s long and winding road? Ignoring risks is a losing formular. However, the members of the crypto community – entrepreneurs and investors – who are prepared and committed to working with regulators to develop a pragmatic regulatory framework will reap the value created by this promising innovation.
Circle Internet Financial, creator of USD Coin, has obtained $440 million in financing and the company is supposedly considering a SPAC deal. Marathon Digital Holdings has adopted and implemented Bitcoin Core version 0.21.1 for its mining pool that will improve privacy, scalability, and future enhancements. One of the most popular cryptocurrencies, Cardano is building interoperability across the crypto space. Makara, a SEC-registered cryptocurrency robo-advisor, was launched in the App Store. Crypto’s future is promising so investors should embrace the message of “Hold Me Tight” by The Beatles and take a long-term view – forget about chasing prices and be a part of building value.
We see an allocation to Crypto as being akin to investing in Venture Capital – you should not allocate your whole portfolio to it, but a small allocation can make a big difference as the illustration below showcases.
Recommended content from our explorations this week:
- Bitcoin Lacks A Solid Foundation As An International Currency
- There’s A New Vision for Crypto, And It’s Wildly Different From Bitcoin
- DeFi Is Helping To Fuel The Crypto Market Boom – And Its Recent Volatility
A final thought…