After finding some stability over the last month, Bitcoin fell close to 17% this week. The rest of the market followed, with Ethereum (ETH) losing 19%, Bitcoin Cash (BCH) 23%, Litecoin (LTC) 20%, and EOS (EOS) 24%.
Bitcoin’s crash has left analysts scratching their heads, considering the positive developments in the market over the last year and the approaching halving (when miners’ rewards get cut by half), which in the past has triggered bull markets.
So, what’s causing the downturn? Some are blaming a series of negative headlines out of China. According to Bloomberg, China’s largest micro-blogging service, Weibo, banned Binance Holdings Ltd. and Tron.
The official accounts of Binance and Tron were suspended as reports emerged that Binance’s Shanghai office was raided by police and shut down. The exchange has denied the story, but the headline and other reports of crackdowns on crypto trading in China were enough to prompt a sell-off.
The actions by Chinese authorities came after President Xi Jinping gave a speech on the promise of blockchain and China’s commitment to the technology. Xi’s statements were taken as an endorsement of digital currencies and sent the market flying in mid-October.
Despite mixed signals out of China and staggering price declines, a lot of really positive news broke this week that I feel obliged to share.
- Fidelity gets a BitLicense: Investment giant Fidelity has been granted a BitLicense from the state of New York. Fidelity will use the notoriously difficult-to-get license to custody crypto assets for institutions. With this step, Fidelity joins an elite group of businesses that hold the BitLicense and reconfirms their commitment to crypto and blockchain.
- Franklin Templeton will use the Stellar Blockchain: Global investment firm, Franklin Templeton, announced Thursday it would be partnering with Curv to build tokenized shares on the Stellar Blockchain. According to the press release, Curv has developed a series of multi-party computation protocols that seek to remove the need for private keys. Curv’s tools will communicate directly with the Stellar blockchain to help scale Franklin Templeton’s initiative.
- PayPal is Expanding its Blockchain Capabilities: Despite dropping out of Facebook’s Libra project, PayPal is still actively working on cryptocurrency and blockchain projects. In a conversation with Fortune, PayPal CEO Dan Schulman said they were developing blockchain projects that could give the company a “competitive advantage.” Oh, and Schulman admitted that he owns Bitcoin!
It’s easy to be moved by crypto’s volatility, but the positive steps towards mass adoption shouldn’t be ignored. I think our friend Scott Melker put it best in this Tweet,
In October, PayPal became the first company to walk away from The Libra Association without citing a specific reason, only that it decided “to forgo further participation in the Libra Association at this time and to continue to focus on advancing our existing mission and business priorities as we strive to democratize access to financial services for underserved populations.” Read more.
Michael Novogratz’s Galaxy Digital Holding Ltd. is starting two Bitcoin funds for accredited and institutional investors with a demographic profile that hits close to home. Read more.
Grayscale Investments, the asset management subsidiary of Digital Currency Group, is filing to register its Bitcoin Trust as a Securities and Exchange Commission (SEC) reporting company. Read more.
German airline Hahn Air, which offers scheduled and charter flights within Europe, announced on Monday it has issued the first airline tickets enabled by blockchain technology, in partnership with Winding Tree, an open-source travel distribution platform. Read more.
Fidelity Digital Asset Services has obtained a trust company charter from the New York Department of Financial Services (NYDFS), allowing the Fidelity Investments unit to custody bitcoin for institutional investors in the financial capital of the U.S. Read more.
Crypto-friendly Silvergate Bank is spending cash from its initial public offering this month to expand its offerings, anticipating higher cryptocurrency price volatility will fuel rising trading volumes and deposits. Read more.
Franklin Templeton Investments, the global investment firm looking to track shares of a money market fund on the Stellar blockchain, has tapped wallet service provider Curv to help safeguard its shares. Read more.
After weeks of mostly sideways movement, Bitcoin price sprang to life this morning, The original cryptocurrency’s price tumbled, dragging the rest of the crypto market along with it, and leaving a sea of red in its wake. Read more.
A US lawyer has been found guilty for his role in the $5 billion OneCoin cryptocurrency scam and is facing a 50-year jail sentence. The scheme’s mastermind, Dr. Ruja Ignatova, is still missing. She is believed to have defrauded millions of investors worldwide, and has been dubbed the “Cryptoqueen.” Read more.