Bitcoin surpassing $11,000 is big news but may not be the biggest story of the week as
Ethereum not only surpasses $300 but also takes the title of the most used blockchain.
How?
stick around to find out on this week’s Exodus Crypto news
Bitcoin, Bitcoin, Bitcoin
Is there much more to say?
(Crowd cheering)
By now I’m sure you’ve heard that bitcoin has reached a yearly high and surpassed $11,000
climbing more than 20% in the last 14 days.
There’s been much speculation that this was ready to happen in March and much like
everything else was delayed by the pandemic.
Our friend Willy Woo said:
“Bitcoin was setting up for a bullish run until the COVID white swan killed the party.“ and
“This model suggests we are close to another bullish run.
Maybe another month to go.”
“The longer this bull market takes to wind up, the higher the peak price”
This upward trend coincided with a surprising twist of the news last week: United States
banks and credit unions may now be considered appropriate custodians for their customers’
cryptocurrency holdings.
The Office of the Comptroller of the Currency, which is a bureau within the United States Department
of the Treasury that regulates and charters all national banks, co-ops, and trusts, recently
published an interpretive letter last Wednesday explicitly taking the position that...
“...A national bank may provide...cryptocurrency custody services on behalf of customers,
including by holding the unique cryptographic keys associated with cryptocurrency.”
However, the OCC didn’t stop there, also asserting that…
“... National banks may provide permissible banking services to any lawful business they
choose, including cryptocurrency businesses, so long as they effectively manage the risks
and comply with applicable law.”
Personally, I see this opinion as helping encourage the banking system to move away
from its highly questionable practices of predatory lending, and back to its more traditional
roots, as the custodian and safekeeper of assets like cash and gold coins that its customers
own without debt attached.
The OCC agrees with me here, noting that “holding the unique cryptographic keys associated with
cryptocurrency, is a modern form of these traditional bank activities.”
Finally, a national bank holding cryptocurrencies in a fiduciary capacity would have the authority
to distribute them as an executor of a will or an administrator of an estate -- something
to think about for those with loved ones who like to plan ahead.
Would you ever trust a bank to hold your Bitcoin?
Let us know in the comments below.
Not to be outdone in the news, the market’s number 2 spot holder Ethereum has also approached
its 2 year high riding the popular DeFi wave, and at the time of recording is priced at
$318 with a 35 billion dollar market cap.
The popularity of DeFi is the main protagonist in this recent movement as active Ethereum
addresses have doubled since the beginning of the year leaving other smart contract networks
far behind as seen in this chart here … Ethereum currently has around 478 thousand active addresses
compared to only 55 thousand on EOS and 146 thousand on Tron.
Stablecoins are part of the larger equation in the DeFi and crypto ecosystem as a whole,
and have helped fuel this price action for other tokens on the Ethereum network.
The transfer volume among the most popular stablecoins -- USDT, Dai and USDC -- has doubled
in the last 2 months, with Tether leading the way as its exchange inflow climbed to
an 8 month high.
If you would like a wallet to use your stablecoins including USDT, TrueUSD, USDC, DAI, PAX and
GUSD as well as and additional 100 cryptocurrencies and crypto apps, click the link above to download
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Besides the utility stablecoins provide for the DeFi Space, they play another important
role: providing liquidity for investors who are moving in and out of market positions.
When whales are moving massive amounts into or out of assets like bitcoin, they are more
than likely using a stablecoin and we can see the correlation of on-chain transfer volume
when the BTC market really heats up.
While the markets are up and ETH seems to be holding its own against other smart contract
platforms, there is a cautionary tale to look out for here.
And here’s the Achilles heel of the rapid growth of the Ethereum platform:
Network fees.
That’s right, it costs money to pay for all these transactions!
As the transaction volume increases so do the fees associated with the network.
These fees invariably make a blockchain less attractive for its users and developers, putting
the brakes on its community growth.
Do you think the Ethereum network is well-positioned to handle this growth as the market leader,
or are there other networks that perform the same functions of ETH that will eventually
take it over?
Let us know what you think in the comments below, and last but not least the winner of
our last week’s treasure hunt was `D Santi` who was the first to identify Greyscale’s
custodial BTC holdings at 3.5 Billion dollars!
That’s all the news for today and it looks as if we’re in for an absolutely wild ride
in the weeks to come!
Be sure to like this video and subscribe to the channel for more crypto videos from Exodus.
Until next time…
HODL on!