State of the Market #52
5/31/2020 - 6/6/2020
Keith Asmussen
Texas Blockchain believes that Black Lives Matter. In support of Black students, we have decided to donate $150 in Bitcoin to the National Society of Black Engineers.
Market Summary
Dotted lines represent non-trading days (weekends, holidays, etc.)
Top Stories
Coinbase Offers US Feds New Crypto Surveillance Tools
Coinbase has set collaborative measures in motion with the DEA and the IRS using their investigative Coinbase “Analytics” tool. Joining a diverse field of other cryptocurrency analytics companies, Coinbase wants in on the competition for Federal contracts. Developed to meet regulatory requirements and protect customers, Analytics is used for internal investigations. The interaction will most likely persist as the IRS noted that Analytics offers “enhanced law enforcement sensitive capabilities that are not currently found in other tools on the market.”
Grayscale Reveals Why It's Buying Up So Much Bitcoin
In last week’s edition of the State of the Market, the massive volumes of BTC being acquired by the crypto fund Grayscale were noted. Ray Sharif-Askary, Director of Investor Relations, revealed that hedge funds and other institutional investors have added $1.7 billion to Grayscale Investment Fund (50% increase in 2020). This inflow is the result of investors seeking an alternative hedge to macro instability and monetary stimulus. Becoming increasingly more diversified in other cryptocurrencies, 38% of Grayscale investors hold more than just Bitcoin.
Ripple and Brazil’s Central Bank Hold Closed Meeting to Discuss ‘Institutional Matters’
Ripple CEO Brad Garlinghouse and other executives held a restricted meeting with central bank of Brazil to discuss “institutional matters.” As many speculators of Ripple’s XRP are skeptical of its cryptoeconomics and ability to reach widespread adoption, this meeting is a great push for adoption. This meeting is following the announcement of Japanese financial giant SBI Holdings to incorporate XRP-powered payments in all their ATMs.
Chart of the Week
Central Banks inflating the fiat monetary base with the aggressive expansion of the Federal Balance Sheet.
Tweet of the Week
NgU = Number Go Up tech
Delinquency Rates on Loans Tripled
Interesting development. We’re seeing ETH dapps begin to skimp on logic-decentralization as it can lead to unfixable catastrophes (bugs that can't be patched), instead favoring custodial-decentralization, which preserves users’ control of their assets.
This means users must trust the developers’ code (which might include an admin key or be closed source altogether) to do what they say it will do, but the user maintains control of their assets at all times.
“Logic-decentralization” means open-source code and community governance of that code and no admin keys (backdoors that can only be accessed by the developer team). This creates code that can't be politically corrupted, but can still be logically corrupted (bugs) and the public nature makes patches/temporary shutdowns infeasible because code management is less dynamic
Video of the Week
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Texas Blockchain’s ‘State of the Market’ is a student-led editorial. None of the views expressed by the authors should be taken as the view of the University of Texas at Austin or the Texas Blockchain organization. Furthermore, none of the views expressed should be taken as financial advice in any circumstance.