Bitcoin and Beyond

Join us as we learn from Sam Ten Cate, Director at State Street Digital focused on Governance and Controls and learn about the implications of US regulation in the crypto industry. Sam discusses the challenge of dealing with a principle-based regulation in the US, as opposed to a more prescriptive regulation in Europe, the importance of investor and consumer protection and the role of the US in the global financial system. Sam sees the existing regulatory framework as sufficient, but believes there is still a need for more clarity going forward.  Bullish on DLT and a little Bearish on public blockchains this is an opportunity to hear the views of someone engaged in the world of regulation.

The cryptocurrency industry has seen some positive developments in recent times, despite the ongoing debate on the SEC versus crypto issue. One of the bright spots is the industry's resiliency, with Bitcoin leading the growth in the market. The Bitcoin protocol, which allows users to inscribe references to digital art or other items, has sparked a lot of debate on whether Bitcoin should be purely a payment system or not. The inscription protocol, called Ordinance, was launched a month ago and has enabled the creation of non-fungible tokens (NFTs), which give rise to a massive ecosystem that was previously untouched by the Bitcoin system. NFTs on Bitcoin have brought utility into the system, expanding its use cases beyond being a payment instrument or a store of value. However, Bitcoin maximalists still see NFTs as controversial and against the pureness of Bitcoin.Other positive developments in the industry include Solana's resurgence, with over 400 projects popping up on the layer one protocol. Helium is also decentralizing telecom networks with HMD tokens, allowing people to host low range, wide area networks and monetize them. The developments in the cryptocurrency industry have shown the industry's resilience and innovative capabilities.

The cryptocurrency industry has seen some positive developments in recent times, despite the ongoing debate on the SEC versus crypto issue. One of the bright spots is the industry's resiliency, with Bitcoin leading the growth in the market. The Bitcoin protocol, which allows users to inscribe references to digital art or other items, has sparked a lot of debate on whether Bitcoin should be purely a payment system or not. The inscription protocol, called Ordinance, was launched a month ago and has enabled the creation of non-fungible tokens (NFTs), which give rise to a massive ecosystem that was previously untouched by the Bitcoin system. NFTs on Bitcoin have brought utility into the system, expanding its use cases beyond being a payment instrument or a store of value. However, Bitcoin maximalists still see NFTs as controversial and against the pureness of Bitcoin.

Other positive developments in the industry include Solana's resurgence, with over 400 projects popping up on the layer one protocol. Helium is also decentralizing telecom networks with HMD tokens, allowing people to host low range, wide area networks and monetize them. The developments in the cryptocurrency industry have shown the industry's resilience and innovative capabilities.

President Biden’s Executive Order on March 9 2022 appears to be the beginning of a new phase in the USA.

In short, it states  

(a) We must protect consumers, investors, and businesses in the United States.

(b) We must protect United States and global financial stability and mitigate systemic risk.

(c) We must mitigate the illicit finance and national security risks posed by the misuse of digital assets. 

(d) We must reinforce United States leadership in the global financial system and in technological and economic competitiveness,

(e) We must promote access to safe and affordable financial services.

 

From Secretary of Treasury to the SEC no less than 17 departments were ordered to review and provide recommendations

 

The outcome so far - In February the SEC heightened its wave of attacks on the industry on Staking, then stable coins and now suggesting it will put restrictions on Hedge Fund Investment into the industry.

Maybe Mahatma Gandhi's great statement is applicable.  "First they ignore you, then they laugh at you, then they fight you, then you win.

Enjoy the first of our series on US Regulations friend or foe. Featuring our guest speaker, Lou Kerner.

President Biden’s Executive Order on March 9 2022 appears to be the beginning of a new phase in the USA.

In short, it states  

(a) We must protect consumers, investors, and businesses in the United States.

(b) We must protect United States and global financial stability and mitigate systemic risk.

(c) We must mitigate the illicit finance and national security risks posed by the misuse of digital assets. 

(d) We must reinforce United States leadership in the global financial system and in technological and economic competitiveness,

(e) We must promote access to safe and affordable financial services.

From Secretary of Treasury to the SEC no less than 17 departments were ordered to review and provide recommendations

The outcome so far - In February the SEC heightened its wave of attacks on the industry on Staking, then stable coins and now suggesting it will put restrictions on Hedge Fund Investment into the industry.

Maybe Mahatma Gandhi's great statement is applicable.  "First they ignore you, then they laugh at you, then they fight you, then you win.

Enjoy the first of our series on US Regulations friend or foe. Featuring our guest speaker, Lou Kerner.

Regulatory changes, liquidity coming alive, market subsectors getting their time in the sun and inflation not considered as problematic as believed earlier.  There points are setting the investment strategy into crypto for 2023. Recently regulators are pressuring banks not to deal with crypto and Binance US just halted US dollar transfers. These are important on-ramps to the space.  This is balanced by non-bank entities providing solutions in many market sectors and currencies is expected to create a mix of opportunities for global citizens.

 

Correlation: Crypto was once considered uncorrelated with traditional markets but now we are seeing more correlation.  Observation - it is all about the time frame.  Over a few months it may be correlated but over 5 years it has not proven to have a high level of correlation.

Correlated or not, both funds look at what drives blockchain solutions that generate value.  Looking at NFT projects the need to store value, provide statistics and transfer digital assets is seen as important for the future of NFT’s.

Crypto assets have a lot of subsectors within the broader crypto umbrella.  The first use case of smart contracts was DeFi and Apollo considers the next major use cases to be NFT’s so the Apollo team thinks there is going to be an intersection between NFT’s and Defi such as NFT derivatives.  

Much of this knowledge is not understood by the professional or sophisticated traditional investor which is where the value add comes from specialist fund manages such as Apollo Crypto Fund and Portal.

These types of funds attract UHNW and Family offices investors not superannuation and institutions in the Australian market at least.

Surprise – institutional investors are still driven by FUD and FOMO despite their size and sophistication, they are humans and reacting accordingly.

Despite the volatility both Apollo and Portal have had very few redemptions so those that have invested have a much better understanding and therefore tolerance to the volatility of the crypto asset class.  

We continue to believe that “Fortune Favours the Informed”.

#crypto #apollocrypto #crypto2023predictions #portaldigitalfund

Regulatory changes, liquidity coming alive, market subsectors getting their time in the sun and inflation not considered as problematic as believed earlier.  There points are setting the investment strategy into crypto for 2023. Recently regulators are pressuring banks not to deal with crypto and Binance US just halted US dollar transfers. These are important on-ramps to the space.  This is balanced by non-bank entities providing solutions in many market sectors and currencies is expected to create a mix of opportunities for global citizens.

 

Correlation: Crypto was once considered uncorrelated with traditional markets but now we are seeing more correlation.  Observation - it is all about the time frame.  Over a few months it may be correlated but over 5 years it has not proven to have a high level of correlation.

Correlated or not, both funds look at what drives blockchain solutions that generate value.  Looking at NFT projects the need to store value, provide statistics and transfer digital assets is seen as important for the future of NFT’s.

Crypto assets have a lot of subsectors within the broader crypto umbrella.  The first use case of smart contracts was DeFi and Apollo considers the next major use cases to be NFT’s so the Apollo team thinks there is going to be an intersection between NFT’s and Defi such as NFT derivatives.  

Much of this knowledge is not understood by the professional or sophisticated traditional investor which is where the value add comes from specialist fund manages such as Apollo Crypto Fund and Portal.

These types of funds attract UHNW and Family offices investors not superannuation and institutions in the Australian market at least.

Surprise – institutional investors are still driven by FUD and FOMO despite their size and sophistication, they are humans and reacting accordingly.

Despite the volatility both Apollo and Portal have had very few redemptions so those that have invested have a much better understanding and therefore tolerance to the volatility of the crypto asset class.  

We continue to believe that “Fortune Favours the Informed”.

#crypto #apollocrypto #crypto2023predictions #portaldigitalfund

2022 - What a year it was.  If there was a party in 2021, 2022 was the hangover. We all know what happen with the large Cefi frauds and contagions and the damage to the industry’s reputation but in January the CCI 30 rose 35% and correlation to NASDAQ dropped to just 0.29 its lowest since 12/21. The year ahead is starting to look exciting.

2022 - What a year it was.  If there was a party in 2021, 2022 was the hangover. We all know what happen with the large Cefi frauds and contagions and the damage to the industry’s reputation but in January the CCI 30 rose 35% and correlation to NASDAQ dropped to just 0.29 its lowest since 12/21. The year ahead is starting to look exciting.

Nitin Gaur is back and reports on his experience in Davos where crypto assets were viewed positively, challenges considered surmountable with focus on Stable Coins, CBDC and infrastructure.

 

Nitin Gaur has returned from Davos where he met and presented to government and crypto industry leaders. The view was positive, constructive and focused on industry infrastructure with less focus on Metaverse and gaming. Listen to what will be part 1 of a discourse on crypto 2023 according to Davos leaders. Remember - Fortune Favours the Informed.