INERTIA Advisory - Weekly Newsletter - 14/03/2022
Welcome to INERTIA Advisory’s weekly newsletter, where you will receive updates on the most remarkable things happening in the cryptocurrency space.
Enjoy!
This past Wednesday, President Biden issued an Executive Order to ensure the responsible development of digital assets in the U.S. The Order provides a foundation for numerous studies to help guide and understand the technology that is still new but growing at a fast pace.
In addition, Janet Yellen, US Treasury Secretary, stated that President Biden’s historic executive order calls for a coordinated and comprehensive approach to digital asset policy. This approach will support responsible innovation that could result in substantial benefits for the nation, consumers, and businesses. She stated that it will also address risks related to illicit finance, protecting consumers and investors, and preventing threats to the financial system and broader economy.
Joe Biden also called for an urgent, full-scale assessment of the potential benefits and risks of a CBDC, both for consumers and investors as well as the broader U.S. financial system.
From my point of view, the US is way too late on this topic. The Chinese government has been working on this concept since 2014 and is already testing their CBDC (Digital Yuan) with millions of users. On the other hand, the ECB has been working on the development of their CBDC (Digital Euro) for a couple of years now. To be honest, it is alarming in a certain way the lack of urgency that the US has, especially when their currency, the US Dollar, is not going through its best period.
According to Blockworks, a bill regulating stablecoins within the US could be introduced as early as this month.
The aim of the bill seems to be related to a report on stablecoins from the President’s Working Group on Financial Markets (PWG). Among other things, that workgroup suggested that stablecoin issuers should be regulated by the Federal Deposit Insurance Corporation (FDIC), just as banks are currently regulated.
This would only work for stablecoins with a centralized issuer. However, there are different stablecoin types (crypto-overcollateralized and algorithmic) that could be difficult to regulate since they are decentralized.
Even though the possibilities of happening are really low, our friend and US Senator, Elizabeth Warren, is crafting a bill targeting cryptocurrencies in Russia sanction.
She is concerned that members of Moscow’s elite might be able to sidestep sanctions by using digital currencies.
It does not matter what the situation is, this woman keeps amazing the cryptocurrency community with her capacity of seeing the dark side of crypto!
Earlier today, members of the European Parliament’s Committee on Economic and Monetary Affairs in the European Parliament voted against a version of the Markets in Crypto Assets, or MiCA, a bill that could have effectively banned the proof-of-work-based cryptocurrencies within the EU. This comes as a huge relief for the crypto industry, whose representatives had previously warned about the threat of a hardline regulatory scenario.
MiCA covers a wide range of crypto-related subjects, such as the status of all major currencies and stablecoins, mining and exchange platforms’ operations, with some notable exclusions such as digital currencies issued by central banks, or CBDCs, security tokens, nonfungible tokens, or NFTs, and decentralized finance, or DeFi.
While VISA CEO is still uncertain about cryptocurrencies' role in the future (note to mention that in the fourth quarter of 2021, Visa customers made $2.5 billion in crypto-connected cards) Visa and Mastercard prepare to raise credit-card fees that many large merchants pay when they accept consumers’ credit cards.
Will this be an opportunity for stablecoin payments to gain traction in this field? Time will tell…
Morgan Stanley, one of the largest financial institutions in the world, appears to have held more than 13 million shares of Grayscale Investments’ Bitcoin Trust (GBTC) across 17 portfolios at the end of 2021, according to regulatory filings published last week.
The GBTC shares were valued at roughly $458 million, a Blockworks analysis of the disclosures found. The positions represented between 0.7% and 1.1% of the net assets in the respective funds, the filings indicate.
Banco Santander, the one of the largest European banks, is partnering with startup Agrotoken to offer loans for the agricultural sector. The loans are backed by tokens tied to grains like soy, wheat and corn.
Agrotoken offers stablecoins that each represent a ton of stored grain. These include soy (SOYA), corn (CORA) and wheat (WHEA). Each token's value is pegged to the price of each commodity in US dollars. The firm has already undergone a pilot project with producers in Argentina to validate the product, Santander said.
Bain Capital Ventures (BCV), the venture arm of 38-year-old private equity firm Bain Capital, has launched its first crypto-focused fund worth $560 million.
YugaLabs, the team behind the creation of the “Bored Ape Yacht Club” NFT collection, just acquired the IP rights of “CryptoPunks” and “Meebits” collections from LarvaLabs.
This is an epic move inside the NFT world since the CryptoPunk project was until not a long time ago, the most valuable NFT collection out there.
The First thing that YugaLabs did is to provide full commercial rights to NFT holders.