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What President Biden’s crypto policy might really be about

Published

10 months ago

14 May, 2024

The Administration’s anti-cryptocurrency policies risk alienating voters of both parties. But the bigger picture, while potentially misleading, may be about preserving America’s global economic power.

Published May 14, 2024 at 12:52 pm EST.

David Z. Morris is a longtime technology and finance reporter and the creator of Dark marketsa newsletter about cryptocurrency, true financial crime and systemic corruption.

Cryptocurrency is becoming a major issue in a US presidential campaign for the first time, as Donald Trump and Joe Biden face off ahead of November’s general election. But what seems like a domestic political misstep by Democrats may actually be about preserving America’s global banking hegemony.

The stakes are rapidly rising. Trump did pro-crypto comments at Mar-A-Lago last week, he appeared to reverse his previous stance on bitcoin “a scam against the dollar”. A recent Harris Poll sponsored by Digital Currency Group found this 20% of American voters consider cryptocurrencies a key issue. Just this morning, Bitcoin Magazine reported comments from longtime Democratic financier Marc Cuban, who said the Biden administration’s anti-crypto stance could it cost Biden the election against Trump.

To know more: 2024 is the most important global election year ever, what does this mean for cryptocurrencies?

The immediate cause of the surge in cryptopolitics is the Biden administration’s stated intention to veto the revocation of the SEC’s Staff Accounting Bulletin 121 (SAB 121). Accounting guidelines require banks to treat digital assets held on behalf of clients as if they were assets owned by the banks, which in turn requires them to hold 5% of the amount in added reserve capital, despite them not being able to use the assets, since they belong to the customers. (Big thanks to Castle Island Ventures Matt Walshwhich sounded the SAB 121 alarm in advance.)

This makes cryptocurrency custody economically unviable for financial institutions and amounts to a cryptocurrency custody ban, imposed without any legal or administrative process. SAB 121 is “guidance” rather than a formal regulatory “rule” and therefore has not been subjected to the standard public comment and review process for new agency regulations.

As Congressman Tom Emmer (right) argued, the rule accomplishes the opposite of the goal legislated by the SEC as an agency, making the market for digital assets more focused, less fair and less certain. The effects of the rule include shifting cryptocurrency custodian services to less established and riskier operators, including offshore ones – the type of custodians that could easily prove to be the next FTX.

“Chokepoint 2.0” and democratic censorship

It doesn’t take much imagination to figure out that making cryptocurrencies less secure is actually the goal of Gensler’s guidance, which forms another pillar in the Biden administration’s ongoing effort, dubbed “Choke Point 2.0” by critics, to prevent any integration of cryptocurrencies with the US financial system, without clear legal authority to pursue such an agenda. That effort included Gensler’s now-failed attempt to block a bitcoin ETF, as well as a series of troubled enforcement actions, including those targeting trusted trading venues like Coinbase.

The nickname “Chokepoint 2.0” is key to the partisan politics at play here. The original Operation Chokepoint was an effort by the Obama administration to pressure banks not to deal with industries including weapons manufacturers and money lenders, essentially threatening greater scrutiny of banks that dealt with those industries.

Even if one respects the goal of the effort to reduce socially undesirable industries, this was a seriously flawed idea. Operation Chokepoint was described as an abuse of the agency’s power by the House Oversight Committee and stopped by the FDIC in 2015. The FDIC settled numerous lawsuits following the program and new restrictions were imposed on its powers .

Notably, the original Obama-era Chokepoint was essentially engineered by Martin Greunbergwho, as the current head of the FDIC, also plays an important role in Chokepoint 2.0.

The global politics of armed finance

The use of banking leverage to attack undesirable but legal industries reflects two distinct factors in U.S. politics. Democrats seem more willing than Republicans to use banks as a cudgel against domestic undesirables, and cryptocurrencies in particular. But in recent years, the United States as a whole has dramatically stepped up its use of the financial system as a weapon against global adversaries, including under the Trump administration. At both levels, these policies aim for short-term tactical gains, with the risk of uncertain and possibly damaging long-term strategic losses.

Not surprisingly, the SEC and Biden administration’s abuse of financial regulation to target legal American businesses has mostly drawn criticism from the conservative right. These can be described as generally “pro-freedom” voters who don’t like the idea of being told what to do, especially by unelected regulators.

But like Nic Carter from Castle Island he underlined, it is not clear who is on the other side of the equation: there is no significant and passionate electorate in favor of anti-cryptocurrency politics. Of the 19% of Americans who own cryptocurrencies, party affiliation is about evenly split. Twenty-one Democratic lawmakersmeanwhile, he joined Republicans in supporting the House bill aimed at overturning SAB 121.

One possible explanation for the Biden administration’s willingness to wage this losing domestic battle is that its real focus is on the threat that cryptocurrencies pose to America’s global banking hegemony. This far-reaching power, like US surveillance of the supposedly neutral SWIFT interbank system, was recently explored by political scientists Henry Farrell and Abraham Newman in their book Underground Empire: How Americans Weaponized the World Economy.

Farrell and Newman describe how almost all global financial transactions at some point pass through US banks and are based on the US dollar. This gives America immense control over such transactions – and in recent years it has used that power much more aggressively, as with the dramatic decision to freeze Russian foreign reserves in response to the invasion of Ukraine.

But Farrell and Newman point out that this is a short-term tactic: the more the United States exercises control of the financial system to punish its enemies, the greater the motivation of these enemies will be to establish new payment channels that do not touch the infrastructure and US services. check. Efforts by BRIC countries to build alternative commercial payment channels have been tentative, but persistent.

But the real nightmare scenario for US financial power is not China regulates oil transactions in RMB — it is the growth of viable crypto infrastructure that makes uncensorable payments universally accessible and attractive around the world. Which he would have stimulate transformative growth removing economic barriers, but it would also undermine an important pillar of American strength.

Perhaps Biden’s ongoing politicization of finance would be more palatable to American voters if the administration were willing to foreground this set of motivations – that is, if they could present their crypto crackdown not as an attack on freedom of the Americans, but as a preemptive move to limit enemies including Russia and China.

But here, as often happens, such long-term international maneuvers have to be conducted under a dark cover. It would be unacceptably provocative if Biden publicly stated something like “America controls all the money in the world, we know it and would like to keep it that way, so we are anti-crypto.” If anything, it would likely push more of America’s strategic opponents to explore cryptocurrencies to circumvent US power.

And so US voters, including many liberals, find themselves pondering what looks a lot like the Biden administration’s domestic financial authoritarianism. For the 20% of American voters who consider cryptocurrency policy important, this will be as appealing as a dog-faced pony soldier.

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We are the editorial team of FinCrypt, where seriousness meets clarity in cryptocurrency analysis. With a robust team of finance and blockchain technology experts, we are dedicated to meticulously exploring complex crypto markets with detailed assessments and an unbiased approach. Our mission is to democratize access to knowledge of emerging financial technologies, ensuring they are understandable and accessible to all. In every article on FinCrypt, we strive to provide content that not only educates, but also empowers our readers, facilitating their integration into the financial digital age.

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News

Block Investors Need More to Assess Crypto Unit’s Earnings Potential, Analysts Say — TradingView News

Published

8 months ago

11 July, 2024

FinCrypt Staff

DeFi Lending Protocol Nexo Allocates $12 Million for Ecosystem Incentives — TradingView News

Block, a payments technology company led by Jack Dorsey square could become a formidable player in the cryptocurrency mining industry, but Wall Street will need details on profit margins to gauge the positive impact of the business on earnings, analysts said.

Block signed its first large-scale cryptocurrency mining hardware pact on Wednesday, agreeing to supply its chips to bitcoin miner Core Scientific CORZbut no financial details were disclosed.

JP Morgan estimates the deal could net Block between $225 million and $300 million, but said more information will be needed to assess the hardware business’s long-term earnings potential.

“We still have a lot to learn in terms of the margins of this business, so we are hesitant to underwrite this transaction until we know more about the cadence and economics,” J.P. Morgan said.

The deal marks a major step for the payments company, which started out as “Square” in 2009 before rebranding in 2021 in a nod to its focus on crypto and blockchain technologies.

Dorsey, who co-founded and ran Twitter (now known as “X”), has long been bullish on Bitcoin. Block began investing 10% of its monthly gross profit from Bitcoin products into Bitcoin in April.

In the first quarter, nearly 9% of the company’s cash, cash equivalents, and marketable securities consisted of bitcoin.

“This development (the deal with Core Scientific) is further evidence of Block’s role as an emerging leader in the crypto hardware ecosystem,” Macquarie analysts Paul Golding and Emma Liang wrote in a note.

Analysts say similar deals to follow could further validate Block’s reputation in the industry.

But J.P. Morgan said the stock’s performance will be determined by Block’s other segments, such as Square and Cash App.

Block shares have lost nearly 17% this year.

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News

This Thursday’s US Consumer Price Index could be a game-changer for cryptocurrencies!

Published

8 months ago

11 July, 2024

FinCrypt Staff

This Thursday's US Consumer Price Index could be a game-changer for cryptocurrencies!

3:30 PM ▪ 4 minute read ▪ by Luc Jose A.

This Thursday, attention will be focused on the United States with the anticipated release of the Consumer Price Index (CPI). This economic indicator could trigger significant movements in the markets, especially for the U.S. dollar and cryptocurrencies. While investors remain vigilant, speculation is rife about the potential impact of these key figures.

The Consumer Price Index: The Cornerstone of the American Economy

The Consumer Price Index (CPI) is a key measure of inflation which reflects changes in the price of goods and services purchased by American households. This index is calculated monthly by the Bureau of Labor Statistics (BLS) and serves as a barometer for the cost of living. The consumer price index covers a wide range of products, including food, clothing, housing, health care, and entertainment. Economists and policy makers closely monitor this data to anticipate economic trends and adjust monetary policies accordingly.

The June CPI data is due to be released this Thursday at 2:30 p.m., and is highly anticipated by investors. The current consensus is for headline annual inflation to decline to 3.1%, from 3.3% the previous month, while core inflation is expected to remain stable at 3.4%.

THE BIGGEST EVENT THIS WEEK 🚨

The U.S. Consumer Price Index is expected to
PUBLICATION TODAY AT 8:30 AM ET.

EXPECTATIONS ARE 3.1% WHILE
LAST MONTH THE CONSUMER PRICE INDEX (CPI) WAS 3.3%

HERE ARE SOME SCENARIOS 👇

1) CPI above 3.1%

THIS WILL BE A DAMAGE TO THE MARKET
GIVEN THAT THE LAST TIME THE CPI DATA… photo.twitter.com/yudjPLPl8g

— Ash Crypto (@Ashcryptoreal) July 11, 2024

Consumer Price Index Release: What Does It Mean for the Dollar and Bitcoin?

Inflation as measured by the consumer price index is a key determinant of the value of the US dollar. If the consumer price index declines more than expected, it could reinforce expectations of a rate cut by the Federal Reserve in September, thus weakening the dollar. A weaker dollar could benefit GBP/USD, which recently broke a major resistance level, and Bitcoin, which could see its price rise due to increased demand from institutional investors.

Current forecasts suggest that headline inflation will decline to 3.1%, with core inflation holding steady at 3.4%. However, a surprise increase in the consumer price index could upset these expectations. Fed Governor Lisa Cook has mentioned the possibility of a soft landing for the economy, with inflation falling without a significant increase in unemployment, which could lead the Fed to consider rate cuts. This outlook is particularly favorable for stock markets and cryptocurrencies, including Bitcoin, which could benefit from a more accommodative monetary policy.

According to experts at 10x Research, especially their CEO Markus Thielen, Bitcoin could see a significant increase if the CPI data confirms a decline in inflation. Thielen indicated that Bitcoin could reach almost $60,000, a prediction that has already been reflected with a rise to $59,350 before the data was released.

Therefore, Thursday’s CPI data could determine the future direction of financial and cryptocurrency markets. High inflation could strengthen the US Dollarwhile a drop in inflation could pave the way for rate cuts by the Fed, thus giving a boost to Bitcoin and other digital assets.

Enhance your Cointribune experience with our Read to Earn program! Earn points for every article you read and access exclusive rewards. Sign up now and start earning rewards.

Click here to join “Read to Earn” and turn your passion for cryptocurrencies into rewards!

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Luke Jose A.

A graduate of Sciences Po Toulouse and holder of a blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I am committed to raising awareness and informing the general public about this ever-evolving ecosystem. My goal is to enable everyone to better understand blockchain and seize the opportunities it offers. Every day, I strive to provide an objective analysis of the news, decipher market trends, convey the latest technological innovations and put into perspective the economic and social issues of this ongoing revolution.

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The views, thoughts and opinions expressed in this article are solely those of the author and should not be construed as investment advice. Do your own research before making any investment decisions.

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News

Crowd Expects Bitcoin Bounce Suggests Further Losses, As RCO Finance Resists Crash

Published

8 months ago

11 July, 2024

FinCrypt Staff

Crowd Expects Bitcoin Bounce Suggests Further Losses, As RCO Finance Resists Crash

Bitcoin is seeing a rebound after its recent price crash to $53,000. Other altcoins are subsequently recovering, with many cryptocurrency investors increasingly making new entries. However, Santiment warned against this hopium, suggesting that Bitcoin could extend its price losses.

As the broader market anticipates Bitcoin’s next price action, RCO Finance (RCOF) demonstrates resilience, attracting thousands of people in influxes. Read on for more details!

RCO Finance challenges the market crisis

RCO Finance (RCOF) is approaching $1 million in funding raised, amid growing interest from institutional traders seeking stability from Bitcoin’s wild price swings. While much of the broader market has seen significant price losses, RCO Finance has remained resilient, experiencing a surge in its pre-sale orders.

As a result, the project seems oblivious to the current market conditions, leading top market experts to take a deep dive into its ecosystem. They identified why RCO Finance was able to withstand the bearish pressure and its potential to hold up even stronger during the impending broader market crash.

The main reason was related to the innovative use of RCO Finance AI Trading Tools as a Robo Advisor. This tool has been integrated into RCO Finance’s cryptocurrency trading platform, offering full automation and highly accurate market forecasts to help investors make informed decisions.

Read on to learn more about this tool and other exciting features of RCO Finance!

Bitcoin Bounces Amid Impending Crash

Bitcoin is bouncing back, rallying 8% after plunging to its lowest point since February on July 5. While this rebound has triggered a bullish wave in the broader market, many cryptocurrency analysts predict it could be short-lived as Bitcoin is poised for an imminent crash toward the $50,000 zone.

On a Post X (formerly Twitter)Santiment revealed that while the crowd is anticipating a Bitcoin rally, this potential crash could trigger FUD and panic, causing average traders to wither and give up on Bitcoin. The platform noted that Bitcoin rally has historically occurred after these weak hands sold their holdings.

In particular, these cryptocurrency analysts speculate that the previous and upcoming Bitcoin crash is largely the result of bearish market psychology, as opposed to large BTC sell-offs by the German government and Mt. Gox. In particular, Ki Young Ju, founder and CEO of CryptoQuant, noticed that “the sales were rather negligible, given the overall liquidity of Bitcoin.”

Enjoy seamless investing on RCO Finance

RCO Finance is making investing easier and easier, democratizing access to high-level tools and cryptocurrency earnings that were once reserved for professional and institutional investors. It has also prioritized accessibility, allowing investors of all levels to easily navigate its features through its intuitive interface.

Additionally, they can also maintain anonymity and privacy as the platform has no KYC requirements. To build trust, the platform has instead emphasized regular smart contract audits by respected security firm SolidProof.

Performance data shows massive adoption, indicating that it is doing its job effectively. Investors can also capitalize on RCO Finance’s fast transaction speeds and incredibly low transaction fees, with leverage options up to 1000x to further optimize their portfolios and maximize returns.

Leverage RCO Finance’s pre-sale earnings

An in-depth analysis of the RCO Finance ecosystem revealed that it has strong potential to rival and surpass major cryptocurrencies in the cryptocurrency industry. With a very limited total token supply and excellent tokenomics, RCO Finance is poised to reach its target of $1 billion in market cap upon its official launch.

RCO Finance has adopted a deflationary model, strategic burn mechanisms, and a vesting schedule. However, the project encourages long-term holding by focusing on sustained growth through incredibly high staking rewards.

RCOF tokens are currently available at an altcoin price of $0.01275 in progress Pre-sale Phase 1. This is likely the lowest price these coins will ever trade at, as they are expected to increase exponentially with each new presale phase.

With RCOF expected to be $0.4 at launch, investors jumping in now can expect a Return 30x on their investment!

For more information on RCO Finance (RCOF) presale:

Visit RCO Finance Pre-sale

Join the RCO Financial Community

Disclaimer: The statements, views and opinions expressed in this article are solely those of the content provider and do not necessarily represent those of Crypto Reporter. Crypto Reporter is not responsible for the reliability, quality and accuracy of any material in this article. This article is provided for educational purposes only. Crypto Reporter is not responsible or liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Do your own research and invest at your own risk.

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News

Bitget Ranks Third Among Cryptocurrency Exchanges by Capital Inflows in Q2

Published

8 months ago

11 July, 2024

FinCrypt Staff

Although Bitget is not the largest cryptocurrency exchange in terms of total volumes, it closed a favorable quarter. From April to June, the platform ranked third in net capital inflows and showed the strongest growth in market share compared to its competitors.

In the second quarter, investors moved $700 million into Bitget, and activity on the platform increased by nearly 50%.

The exchange has seen a surge in user funds, with Bitcoin (BTC), Tether (USDT), and Ethereum (ETH) rising 73%, 80%, and 153%, respectively, in the first six months of the year. This growth coincided with adding 2.9 million new users to the platform.

This has positioned Bitget among the top exchanges with the highest positive net inflows in the last quarter. Only Binance, which remains the market leader, and Bitfinex have performed better in this category.

According to CCData’s latest H2 Outlook Report, the exchange also recorded the highest market share growth among centralized exchanges, increasing 38.4% from H2 2023 to H1 2024.

Bitget’s spot trading volume has also seen a visible increase, going from $28 billion in Q1 to $32 billion in Q2, marking an increase of over 10%. The platform’s monthly visitors have reached 10 million. Although its volumes are increasing, Bitget still does not rank among the top 10 cryptocurrency exchanges in terms of spot trading.

The changes taking place in the centralized cryptocurrency exchange market show that competition is becoming more and more intenseAn example of this is the recent surge in popularity of Bybit, which has become the second largest exchange in terms of spot trading volumes.

Sports Sponsorships and New Products

Gracy Chen, Source: LinkedIn

Gracy Chen, CEO of Bitget, commented on the quarterly performance, saying, “Q2 2024 was a pivotal period for Bitget. Our collaboration with Turkish athletes, along with significant growth in users and website traffic, is part of our global expansion.”

In an effort to expand its global presence, Bitget has partnered with three Turkish national athletes as part of its #MakeItCount campaign, starring Lionel Messi. The deal with the famous footballer It was signed in Februaryto build brand presence in Latin America.

The exchange also launched a $20 million TON Ecosystem Fund in partnership with Foresight Ventures to support early-stage projects on The Open Network.

The exchange introduced two new initial token listing products, PoolX and Pre-market, which collectively launched over 100 projects. Additionally, Bitget’s native token, BGB, was recognized as the best-performing centralized exchange token in June and was ranked among the top 10 cryptocurrencies by Forbes.

In its latest move, the cryptocurrency exchange aimed to become a regulated player in IndiaThe announcement comes as the world’s most populous democracy grapples with the complexities of integrating cryptocurrencies into its financial ecosystem.

Even recently,
Bitget Wallet Announced a joint investment with cryptocurrency investment firm Foresight X in Tomarket, a decentralized trading platform. This initiative targets emerging asset classes and aims to expand the portfolio’s services beyond traditional decentralized exchanges (DEXs).

In the second quarter, investors moved $700 million into Bitget, and activity on the platform increased by nearly 50%.

According to CCData’s latest H2 Outlook Report, the exchange also recorded the highest market share growth among centralized exchanges, increasing 38.4% from H2 2023 to H1 2024.

The changes taking place in the centralized cryptocurrency exchange market show that competition is becoming increasingly intenseAn example of this is the recent surge in popularity of Bybit, which has become the second largest exchange in terms of spot trading volumes.

Sports Sponsorships and New Products

Gracy Chen, Source: LinkedIn

The exchange also launched a $20 million TON Ecosystem Fund in partnership with Foresight Ventures to support early-stage projects on The Open Network.

Source