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Newsletter #16: Ethereum 2.0 Launches successfully

Market situation: Is the $BTC sale over?

This week we have witnessed a very strong Bitcoin comeback after the approx. 20% price dump. The price has been going sideways in the USD $18-19,000 area for a few days now in the anticipation of the next move. The bottom of the dip was $16200 (Bitstamp) and many hope this could be the right time to pass the critical wall at $20k (which many have been dreaming about for years). The Relative Strength Index (RSI) on the weekly chart is still in overbought territory and we are far above the 21 Moving Average, an indicator that has historically been respected pretty well by previous bull runs, when the price repeatedly bounced over it during retraces.


In the meantime, some altcoins have had relief rallies like $SUSHI (2.25x in 10 days) and $RAMP (x2 in the same period), which is now at 6x since the after-launch bottom in October 2020. 

BTC hovering around highest weekly ressistence
BTC hovering around highest weekly ressistence

On the daily chart, we can observe that after the initial spike to almost ATH at the highest existing weekly resistance on the chart, Bitcoin dropped quite abruptly back to the previous weekly support before bouncing back strongly. This channel has then been respected perfectly until now. The price seems to be consolidating at its top and we all hope this could be the launchpad for the next run up!

Facebook’s Libra to launch in January 2021?

Libra, the awaited digital currency project founded by Facebook in 2019, could see the light of day at the beginning of 2021.

In an article published by Coindesk on November 27th, sources claim that the Libra (now re-named Diem) may launch with only one stablecoin, backed by the dollar, unlike the original plan which included a basket of different FIAT currencies (we wrote about Libra/Diem in depth here). 

Libra/Diem’s journey has been quite tormented by regulators in its short history and some of the initial members have already left the project, like Paypal, Mastercard  and Ebay. Many others have declared that they are waiting to see how the launch will go before even considering an investment.

Regulatory approvals by the Swiss Financial Market Supervision Authority (FINMA) are still pending. There is no official date.

US regulators tighten grip on stablecoins

One of the issues related to stablecoins (like Facebook’s Diem) could now become the Stablecoin Tethering and Bank Licensing Enforcement (STABLE) Act.

Introduced by the United State Congress, it aims at reinforcing regulations for stablecoins and stablecoin-related products. In particular, it would require issuers of stable coins to get bank charters and regulatory approval prior to circulating stablecoins.

The justification for this regulation, according to US Representative Rashida Tlaib is that it would prevent cryptocurrency providers from repeating the crimes by “big banks” against low-moderate income minorities.

Under the proposed regulations, cryptocurrency providers would be required to fulfill a list of actions like “Require any prospective issuer of a stablecoin to obtain a banking charter” or “Require that any company offering stablecoin services must follow the appropriate banking regulations under the existing regulatory jurisdictions” and more.

While this should mainly impact private stablecoins provided by big tech companies or big exchanges (and probably less the DeFi movement), many in the cryptocurrency space have raised their voices and doubts. The problem being that, in the end, these regulations if they do become law could have the opposite outcome of what is proposed. Cryptocurrencies have always been totally transparent and equal to all the people who want to invest in it. Costs involved in maintaining your portfolio are mostly negligible, unlike the traditional financial sector, there is no need to wait weeks for approvals, everyone can control their own money and you can access them from anywhere in the world, no matter your “social class” or bank account. Could these regulations in fact increase costs and deter poor people from accessing these services?

European Central Bank is working on the Digital Euro…will it surpass China’s DCEP?

Speaking about digital currencies Fabio Panetta, board member of the European Central Bank (ECBD), outlined last week four major areas they are mainly working on to bring forward the digital Euro:

  1. The Target Instant Payment Settlement (TIPS), which allows “individuals and firms to transfer money between each other within seconds”. In particular the ECBD needs to establish that it will be able to function with hundreds of millions of customers;
  2. interoperability between centralized systems and distributed ledger technology (DLT);
  3. use of “payment-dedicated blockchains with electronic identity”; and
  4. study of hardware devices able to maintain the privacy.

Read the whole article by ledgerinsights

Will it surpass China’s national currency DCEP? For now it seems unlikely as DCEP is in much more advanced stages of testing. The most recent test being a large scale airdrop of RMB 10mil to around 50,000 Shenzhen residents to spend. 

Learn more about China’s DCEP.

ETH2 is live!

On 1st December 2020 the Ethereum 2 Beacon Chain went live exactly one week after the threshold deadline!

If you are interested in becoming a validator, you can read our full guide here or watch our dedicated livestream on how to set up an Ethereum 2.0 Node!

GBV acquires OMG Network

Genesis Block Ventures (GBV), an investment company working with Genesis Block, has announced the acquisition of OMG Network.

This decision was taken to “leverage its (GBV) network strength, to promote the accelerated growth of OMG Network, and further enhance the adoption of OMG blockchain in Asia and beyond”.

This is the first acquisition for GBV, an “investment company with a mission of building the future through blockchain” which has been pretty active in Defi this year and has so far worked on building meaningful relationships and collaborations in the area.

OMG, which launched in 2017 as Omisego, is a second-layer scaling solution for Ethereum platform capable of high-speed transactions (thousands per second).

Find out more in our upcoming livestream

See HERE for back issues of our newsletter! 

Michael
I’ve been involved in the Bitcoin and Blockchain space since 2012. Something I notice right away is that accurate factual information is hard to come by in this space. More often than not, we find extremely biased information that exploit the complexity of blockchain to obscure facts. The objective of this site is simple – to provide independent insights into the blockchain space.

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