Keith Asmussen, Joshua Ebedes, Preston Sledge, Max Bibeau
Happy 4th of July Weekend!!!
Market Summary
Dotted lines represent non-trading days (weekends, holidays, etc.)
Top Stories
Promising Sign: Almost 2 Million People In UK Currently Own Bitcoin And Other Cryptocurrencies
UK’s Financial Conduct Authority (FCA) recently released a study that found 1.9 million people (3.86% of the population) own crypto at the moment. In addition to the 30% growth in crypto ownership, 73% of the population stated that they have heard of crypto in 2020 compared to only 43% in 2019. The figures provided by the FCA suggest that the dream of mass adoption of cryptocurrency is gradually becoming a reality with an increasing number of people seeing crypto as an attractive alternative to the existing financial system.
Bitcoin’s Price Correlation With S&P 500 Hits Record Highs
The one-month bitcoin-S&P 500 realized correlation increased to it an all-time high of 66.2% on Tuesday. In recent months, Bitcoin has become progressively more correlated with the S&P 500, causing damage to Bitcoin’s reputation as digital gold. Historically, gold has very strong past performances during times of financial stress while Bitcoin has yet to prove itself as a safe-haven asset.
U.S. Moves Closer To Digital Dollar
The pressure to create a digital USD is mounting as China recently began testing of its own digital currency: DCEP. On Tuesday, the Senate Banking Committee held a hearing on the future of the digital dollar. In the hearing, Arkansas Senator Tom Cotton stated, “The U.S. needs a digital dollar...The U.S. dollar has to keep earning that place in the global payments system. It has to be better than bitcoin … it has to be better than a digital yuan.” Head of the Digital Dollar Project, Chris Giancarlo, emphasized the possible social and national benefits noting that “the most adaptive survive.”
Chart of the Week
This graph from The Block article “Monthly volumes for DEX soared past $1.5 billion to hit all-time high in June” depicts the increase in popularity of DEX exchanges. A DEX (decentralized exchange) is a type of crypto exchange that operates without a central authority. A CEX (centralized exchange) is a type of crypto exchange that operates with a central authority. Decentralized exchanges aggressively stealing market share from centralized exchanges suggests increased speculation.
Top Tweets
@patrickc - the CEO of Stripe - speaks out against the Chinese governments abuse of its people. Patrick is one of far to few CEOs brave enough to speak out against the human rights abuses committed by the Chinese government. Companies all to often turn a blind eye to Chinas mistakes and evils to protect their financial interests. Thanks Patrick Collison for standing up for whats right.
@hosseeb gives his analysis on Chinas BSN integrating with public blockchains in an 8 part thread. BSN (Blockchain Service Network), Chinas state owned, nationwide, and mostly permissioned blockchain is reportedly moving to integrate public blockchains like Ethereum and Nervos Network. Many people are hopeful that this will lead to more decentralization within the BSN network and be a step towards realization of the freedom blockchain promises.
@nic__carter compares the US fiat system and voting to a delegated proof of stake crypto system. Funny but painful.
@TFMetals. Someone tell @PeterSchiff. Bitcoin fixes this.
Video of the Week
Inflation and Deflation: A Hidden Tax - Econ Clips
With the Federal Reserve radically increasing money supply in the US, talk about inflation is everywhere. This 6 minute animated video gives a short explanation of Inflation and Deflation along with a summary of the incentives created by both.
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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.