The crypto market is already reaching maturity, although some “teenage years problems” persist. Nevertheless, one can look to the future with confidence and believe in the growth of the capitalization of the entire segment and the influx of investors, especially in the light of news about the success of Ethereum and the possible entry of Facebook into the digital currency market. How did last week’s news influence the exchange rates of Bitcoin and top altcoins?
Constantinople Fork and the SEC Opened New Opportunities for Ethereum
The long-awaited Constantinople hard fork took place on February 28, which increased the block confirmation time on the Ethereum network to an average of 12.5 seconds and also reduced the block reward to 2 ETH. Also, many large-scale changes ultimately should lead to the introduction of the PoS protocol. Last Friday, there was a massive conference with the participation of leading Ethereum developers where the main issue was the introduction of the new Istanbul upgrade, within which the activation of the EIP1057 protocol is planned. This protocol will, first of all, usher in the network transition to the PoS algorithm by reducing the mining capabilities on ASIC devices. If two independent audits do not reveal critical errors that would have to postpone updating indefinitely, as was the case with Constantinople, then we can expect the Ethereum network upgrade to be launched by mid-May.
The past week also saw news from the main financial regulator of the United States, which is one of the main “peacekeepers in the crypto market.” The Securities and Exchange Commission (SEC) made another critical decision for the digital currency industry. The regulator acknowledged that Ether in the current conditions could not be regarded as a security, as evidenced by the results of the traditional Howey test for resolving this issue. Moreover, SEC Chairman Jay Clayton, who previously acknowledged that Bitcoin could not be classified as a security, either, said in an official letter to congressman and crypto supporter Ted Badd that Ether now also does not meet the criteria of the investment contract. This decision opens up new opportunities for Ethereum to operate in the United States and interact with international companies without mutual fear of being fined and other sanctions imposed by the SEC.
Facebook Continues to Conquer the Cryptocurrency World
A week earlier, financial media reported that Facebook was considering options for implementing a payment system in the WhatsApp messenger. And on February 28 in The New York Times, there was the news about the possible launch of a stablecoin within the framework of the well-known social network backed by several major fiat currencies at once. This week, the media picked up some exciting news about the launch of a new cryptocurrency. Thus, according to analyst Ross Sandler, in 2021, Facebook will be able to attract about $19 billion in additional revenue if the stablecoin is successfully integrated into Facebook’s work, in particular, in the content distribution segment. At the moment, the main obstacle for Facebook is the lack of a clear understanding of the prospects for using digital currency as a means of micropayment and in everyday use—the role that plastic cards and mobile applications of banks play today.
Blockchain Will Help The New York Times Reporters
One of the largest U.S publications, The New York Times (NYT), has gradually become interested in the possibilities of the cryptocurrency world. To study this issue, NYT opened a vacancy for a specialist in the field of blockchain technologies. The duties of the new employee include a blockchain experiment lasting a year. But this will not be some kind of internal workout, which they are not ready to share with others. On the contrary, NYT is already inviting publishing houses, the media, social media, and researchers to join the new consortium. All the details of the plans for the work of this consortium and the tasks for the new employee are not yet known, but we can already assume that the goal will be to find opportunities to publish content on the blockchain and search for new opportunities to appeal to the audience, which ultimately will lead to profit in the field that competitors are just beginning to master.
News from the World of Big Business Is Again Full of Positivity
Blockchain ETF trading started on the London Stock Exchange (LSE) on March 11. The new financial instrument is called Invesco Elwood Global Blockchain ETF, the price of which can be monitored on the Bloomberg portal. The new asset was named after the two investment companies that created it. In particular, Invesco contributes to the entry of this product into the market, and Elwood Asset Management will develop a scoring system for 48 companies operating in the blockchain industry and calculate the share of investment in their portfolio. It is worth noting that this list includes the securities of the Taiwanese company Taiwan Semiconductor Manufacturing (TSMC), which is leading in the field of mining.
Deutsche Börse, one of the largest German stock exchanges, also announced the start of work on creating an ecosystem of a tokenized economy based on distributed registry technology. Its new partners from Switzerland—the telecommunications company Swisscom, which is owned by the government of the country, and the financial startup Sygnum—will help in this. Their mission is to create a regulated and transparent environment for digital assets with the prospect of transforming global financial markets. One of the first users of an innovative product will have to be institutional investors, for which a license has been obtained from the Swiss Financial Market Supervisory Authority (FINMA).
In the light of this news, we can safely say that big business is no longer just interested in the field of digital currencies and decisions related to them but has long invested in them, expecting to get billions of dollars in profit and win leadership positions in their industries through the integration of innovative products.