Mohi-uddin believes that bitcoin must conquer every obstacle to replace gold as a store of value. The bank also considers that cryptocurrency custodians should guarantee more confidence to investors.

In a report that appeared on January 22, Bank of Singapore chief economist Mansoor Mohi-uddin explained that he considers it unlikely that bitcoin (BTC) and other cryptocurrencies will replace government-issued currencies as a traditional medium of exchange. However, it has the potential to displace gold as a store of value.

The executive said that cryptocurrencies must achieve people’s trust, defeat volatility, achieve regulatory acceptance, and solve risks to have the required potential to become a store of value that could match and even defeat gold.

Chief Economist of the Bank of Singapore, Mansoor Mohi-uddin, said that Bitcoin’s staggering rally is on pair with the largest investment booms of the past decades, including gold in the 1970s, Japanese stocks in the 80s, Internet stocks in the 90s, the price of oil in the 2000s, and tech companies that emerged in 2010.

Cryptocurrencies are unlikely to replace national currencies as the primary medium of exchange in any economy. Instead, digital money could, over time, partially displace gold, offering an electronic rather than a physical store of value.

In this regard, The Chief Economist explained that investors need reliable institutions to offer protection and safety to digital assets. He also stressed that “volatility should find a balance to a more manageable level to improve liquidity.

The executive believes that to reduce bitcoin price volatility, more institutional, retail, and hedge fund investors should join the cryptocurrency business. That will likely increase liquidity, and prices would be free from any speculation.

The executive also highlights that young people prefer bitcoin and other digital assets over gold due to more comfortable handling and storage in virtual wallets. In contrast, precious metals are difficult to use for daily transactions and must receive daily protection in secure physical locations.

Similarities between Bitcoin and Gold

The economist came to a conclusion that establishes similarities that, in his opinion, exist between gold and Bitcoin. It specifies that the prices of both are set many times by “investor demand and financial speculation.” It also maintains that bitcoin and some cryptocurrencies have a “limited supply,” as does gold.

Other analysts have talked about this argument before. The management firm of hedge funds SkyBridge Capital is transparent that “bitcoin is like digital gold, and as such it can even surpass its value, Bitcoin has the potential to be better gold than gold.” Bitcoin is better because it solves the portability and divisibility problems that make it difficult to use gold as fiat money.

At the end of 2020, SkyBridge estimated that there were approximately 18.5 million bitcoins in circulation. They calculate that users will mine in about 120 years the remaining 2.5 million of the 21 million total bitcoins to exist to date.

By: Jenson Nuñez

The number of investors owning 1,000 BTC is increasing. Despite the decline in the price of the cryptocurrency, bitcoin continues to flow on Grayscale.

The number of investors owning 1,000 BTC is increasing. Despite the decline in the price of the cryptocurrency, bitcoin continues to flow on Grayscale.

These days, institutional investors and the richest are increasing their Bitcoin profits by taking advantage of retail users’ fear. The big holders continue to accumulate coins even with a decrease in the price, concludes CoinMetrics in its latest newsletter on the State of the Network.

In a report that saw the light on January 26, the cryptocurrency market data provider analyzes how fear, uncertainty, and doubt (FUD) would influence the fall in the bitcoin price that happened last week. At that time, the cryptocurrency fell 17% from USD 40,000 to $ 31,400 per unit.

The crypto asset collapse went in parallel with disseminating various information that created confusion among users and generated fear. “Some holders got afraid and sold their shares,” says the report. User hysteria exploded on January 20 when diverse media spread a false story about a double-spend in bitcoin.

Several insiders of the ecosystem spoke to the public to enlighten the matter and make things clear, but the fear expanded too fast, and the price of the cryptocurrency decayed.

Later, stories about the transition of command in the presidency of the United States began to circulate. Among the stories, the incoming Treasury Department Secretary Janet Yellen stated that cryptocurrencies’ use was primarily for illicit purposes and that it would be essential to crack down on illegal use cases. “The claim is not only false but also out of context,” the report adds.

Yellen had said that she believes that there is a careful study of how to encourage the use [of cryptocurrencies] for legitimate activities while restricting their use for malicious and illegal activities.

Bitcoin Whales and How they Get Stronger Through Fear

Analysts at the data provider firm believe that the FUD was not the only factor influencing the bitcoin price drop last week. They did find enough elements to assure that the biggest holders of bitcoin (whales) may be taking advantage of the subsequent fear that spread in the market. These whales are using fear as an advantage to accumulate more coins.

The data shows that, despite the price drop, the number of addresses that have at least 1,000 BTC (more than USD 30 million) increased by 11%, from an approximate record of 2,200 addresses to a total of 2,443. The figure indicates that the number of large BTC holders continued to rise as retailers shed their positions.

Well-known analyst Willy Woo also referred to the increase in the number of addresses that own more bitcoin. He thinks that there is a need to redefine the terms that became popular when classifying hodlers.

He said through a joke that the ecosystem needs the collaboration of marine biologists to learn about the different types of “shrimp” (whales prey) that would allow addresses with less than 1 BTC to be classified. From his perspective, this action will serve its purpose once the cryptocurrency price returns to its bullish boom, as he believes it will.

By: Jenson Nuñez

The commitment of the organization is to achieve a more significant consolidation of cryptocurrencies. Clients of its private banking service in Switzerland already operate with bitcoin.

Banks have been tracking bitcoin (BTC) and cryptocurrencies for years. Nowadays, some of these banks still show skepticism, while many others have already taken the step to adopt it to design new business models.

A more open position is the Spanish BBVA, which recently activated the bitcoin trading service at its subsidiary in Switzerland. It is an alternative for private banking clients who want to receive more exposure to the first cryptocurrency market.

Alicia Pertusa, BBVA’s Head of Client Solutions Strategy, said that the priority is to grant every client total access to new cryptocurrency markets. The executive also expressed her concern about the variables that would drive greater demand for bitcoin on a broader scale.

“On the one hand, the greater regulatory standardization at a global level. On the other hand, the more significant technological maturity of service providers in crypto. From our experience, the exciting profiles are mostly private or institutional banking clients who want to bring a more diverse portfolio by investing a small percentage in crypto assets, “said Pertusa.

Two Factors acted as an Influence on the Operators’ New Perspective

The head of the strategy added that the private client segment also wants to explore investing in these assets. When asked about the change of opinion of some investors about bitcoin, who associated the cryptocurrency with allegedly illegal practices, Pertusa cited two factors that would have influenced the operators’ new perspective.

The first would be that law enforcement agencies are now more involved in monitoring their capacity to prevent money laundering and terrorist financing. The second would go about the development of tools to analyze the transactions on the Bitcoin network.

In the past, bitcoin received accusations of being a tool that serves mostly suspicious activities, an argument that received a harsh refutation from the head of the strategy at BBVA. Pertusa recalled that unlawful practices account for less than 1.5% of all bitcoin transactions. According to the UN, the figure is around 2% and 5% in national currencies.

Users Need to Have the Proper Tools and Knowledge

Pertusa pointed out that the vast majority of transactions with cryptocurrencies leave more traces than cash and even electronic money. Users need to have the proper tools and knowledge to use all the data that the blockchain provides.

The bitcoin purchase and sale operations in the bank’s Swiss subsidiary could be the first step for expanding the service to other markets in Europe or Latin America. On this point, the executive talked about the analysis of many different options as they find a more friendly environment regarding regulations, maturity, a piece of more strong knowledge about the network, and what is, perhaps, the most critical fact: demand.

By: Jenson Nuñez

In recent days, the price of Bitcoin closed above USD 31,000. Ether set a new all-time high a month later the main cryptocurrency of the market exceeded USD 20,000.

After recording the first correction in the current bullish cycle, the price of Bitcoin had a new pullback. It came to be above USD 33,000, closing the last week with a drop of 6.7%.

Several events that bear a relationship with the fall of the price of Bitcoin took place recently. Among them are statements by the President of the European Central Bank, Christine Lagarde, and the new US Treasury Secretary, Janet Yellen. Both officials fear that some users may use Bitcoin in money laundering and terrorist financing.

The price of Bitcoin recently retreated to USD 29,200. However, it then rebounded amid new announcements about institutional investments in Bitcoin and other cryptocurrencies.

Institutions Continue to Support Bitcoin

BlackRock is the US investment company with the most assets under its management worldwide. They recently filed with the US Securities and Exchange Commission (SEC) prospects that include Bitcoin futures in two of their funds.

People could also see that Janet Yellen changed her stance on Bitcoin during a hearing before the Finance Committee of the US Congress. She said that these types of assets have the potential to improve the efficiency of the financial system.

Meanwhile, Canadian fund manager 3iQ announced that its Bitcoin fund exceeded 1 billion Canadian dollars (CAD). The company was able to reach that record thanks to the recovery of the pioneering cryptocurrency.

Crypto investment firm Grayscale applied to the Delaware Division of Corporations for the creation of six other cryptocurrency funds. These include crypto assets such as Bitcoin (BTC), Chainlink (LINK), Tezos (XTZ), Decentraland (MANA), and Filecoin (FIL), among others.

Institutional Expectations on Bitcoin

Trading platform eToro recently surveyed bankers, mutual fund managers, market makers, liquidity providers, and custodians. This consultation identifies institutional expectations about greater investment in the market of Bitcoin and other cryptocurrencies.

Respondents hope that regulatory agencies will have a more consistent attitude towards cryptocurrencies. Besides, they consider that the value of the cryptocurrency market should grow more to attract more institutional investors. They expressed that opinion even though the market value of cryptocurrencies crossing the USD 1 billion milestones.

The IMF Tells Countries to Spend

It seems that the macroeconomic environment continues to favor Bitcoin, with the quantitative easing policies of several developed countries. This could lead Bitcoin to become more attractive to investors as a hedge against an increasingly weak US dollar.

The IMF recently confirmed that they favor an expansionary monetary policy. The managing director of this organization, Kristalina Georgieva, said: “Although it is unusual for the IMF, I ask you to spend. Please spend as much as possible, and then spend a little more.”

Ether’s New All-Time High

In 2020, the second cryptocurrency by market capitalization surpassed Bitcoin in terms of annual return. However, it had remained below its all-time high of USD 1,420 since January 2018.

A month after Bitcoin managed to break above the USD 20,000 mark, Ether (ETH) traded at USD 1,435. In that way, it set a new all-time high. Although the new record was temporary, Ether also recorded one of its highest trading volumes at the time. The cryptocurrency on the Ethereum network reached USD 14.5 billion in just 24 hours.

By Alexander Salazar