News:
What happened: Joe Biden confirms crypto-savvy MIT professor Gary Gensler to lead Financial Policy Transition Team
How is this significant?:
- With Joe Biden now (seemingly!) the United States president-elect, the transition teams he puts together to prepare for his upcoming term could offer clues to policy direction.
- Gary Gensler will be in charge of the financial policy transition team. Not only is he a former CFTC chair under the Obama administration, but he is currently professor of global economics at MIT business school and senior advisor to the MIT Media Lab’s influential Digital Currency Initiative.
- Digital assets and cryptocurrency are still a relatively new concept in financial circles; Gensler called it a “change catalyst” in his role at MIT. Cryptocurrency wasn’t mainstream at the beginning of the previous administration, but this appointment could signal a wider acceptance both politically and economically.
What happened: A World Economic Forum cites blockchain as a cornerstone of sustainable digital finance
How is this significant?:
- The WEF is an influential platform for global economic policy, and the report published on Wednesday gives blockchain a ringing endorsement for business adoption.
- UBS executive Karin Oertli believes blockchain is key to improving environmental sustainability in business, writing “The core properties of blockchain and other DLT can enable deeper technological integration, standardisation, and the possibility of new business models”.
- This echoes the State of Climate Tech 2020 report from PWC in September, which noted that “powerful new technologies – like AI, cloud, blockchain… are not only enabling solutions to be optimised and scaled, but are offering entirely new business models”.
What happened: The world’s second-biggest bank issues bonds on blockchain, redeemable for Bitcoin
How is this significant?:
- Although not a household name in the west, China Construction Bank (CCB) is one of the “big 4” banks in China—making it bigger than most global companies. According to Forbes data, it’s the second-biggest bank in the world.
- As reported in the South China Morning Post, they have sold $3b worth of bonds on blockchain. The certificates of deposit are tokenised, allowing retail investors to buy fractional shares of the bonds, “making stocks and bonds more accessible”, as well as reducing issuance costs to the bank.
- “The deal also allows investors to trade these China Construction Bank’s digital certificates using bitcoin, on Fusang Exchange, a digital exchange licensed by the financial regulator in Labuan, Malaysia”.
- As a state-owned bank, release of such financial instruments would appear to represent at least an implicit approval by the Chinese state, a far cry from a short-lived ban on cryptocurrency in 2017.
Market Overview:
Positive news continued to roll in across crypto and blockchain, and once again this was reflected by the trading activity across the market.
- Bitcoin continued its strong momentum, hitting its highest levels since January 2018, touching exactly $16,000 on the charts of major exchange Coinbase early on the 12th, before a short retrace and rise to a high of $16,470. Despite a couple of large sell-offs earlier in the week dropping it down to as low as $14,800, it quickly rebounded, spending the majority of the week above $15,500, and is in the area of $16,220 at the time of writing.
- After having taken so long to break through historic resistance at $12,000, the two swift rejections of sub-$15,000 drops may indicate a new psychological support level for traders. $16,000 was the next major point of resistance, so it remains to be seen whether that can become a new support level. It should be noted that 8 of the last 10 weekly candles for BTC have been green, with steady growth this year.
- Ethereum had a strong week, rising from a low of $410 to a high of $476, making a strong run for its yearly high of $488 (set at the beginning of September).
- The overall cryptocurrency market cap continued to grow as well, adding nearly $10bn from last week’s high to hit $453.2bn.
- DeFi ecosystem breezed to a new ATH of $13.7b Total Value Locked on the 11th of November, up from the previous week’s TVL ATH of $12.4b.
- ALL the top 10 coins by market cap were green over the course of the last seven days.
Another strong week in the markets. Have a great weekend, onwards and upwards.