JPMorgan extending banking services to Bitcoin Exchanges and more… | Crypto Market News
Thrilling market news with CoinMetro’s CEO, Kevin Murcko in This Week in Crypto!
Crypto Market News Highlights
Kevin had his famous in-person duel with Dr. Doom, where famously after they had their clash, he took a smiling photo with Kevin. Kevin never sat down with Peter Schiff, but sees his tweets and sometimes responds to them.
Some things that these guys say are absolutely correct. But you have to remember that on the other side of this, you have Anthony Pompliano, Brian Armstrong, and more, “on the Bitcoin side”. So you have guys on both sides of the equation. They’re touting their product.
These guys are selling gold, the other guys are selling Bitcoin. Both sides make statements that Kevin would agree with, and both sides make statements that Kevin would not agree with. It’s a bit ridiculous that they come out. They didn’t come out when it shot up from 4k to 10k to try and argue it meant it was worse than gold. They could have said it’s super volatile.
At the end of the day, they have points. Bitcoin is not a store of value, to Kevin. But neither is gold. At the same time, there are reasons why Bitcoin is great to have in your portfolio. It is volatile. It has been the best performing asset for anybody’s lifetime currently for anyone on this planet. Does that mean it will be the best performing asset from now? No, it absolutely does not.
Everybody likes to see their names in lights, like these two gentlemen. So they get their names in lights. And when Bitcoin has some bullish momentum, and isn’t super volatile, then they don’t say anything.
Wow, did they need a magnifying glass and a Sherlock Holms to figure that one out?
Kevin loves when people take small ranges of time, and then make comparisons that sound macro. “Bitcoin in the last two weeks has outperformed gold”. So what? Who cares?
When you buy into any asset, you need to look at long term. The upside or downside of Bitcoin since January is not interesting. To be honest, Kevin thinks the upside of Bitcoin from 2009 to 2020 is literally meaningless if he’s buying today. Still a speculative asset.
Kevin doesn’t care about comparisons, and no one should, really. But for some reason people always drop back on comparisons. This year, gold is up about 12%, and Bitcoin is up 25%. So, while it’s double, it’s not amazingly different for an asset that has such extreme volatility.
Every trading venue Kevin has ever been a part of, or seen, in times of mass-usage, generally tends to have some issues. Why? Because they all use the same technology. No matter how great your matching engine is — you’re sitting on some type of server infrastructure, ISP lines, some type of non-cosmic technology, that can break.
Coinbase probably got back up quite quickly, and Kevin can’t say much bad about Coinbase. They handled it much better than BitMEX has handled it in the past.
It just shows that no matter how great the frontend looks, lots of backend still is antiquated because no one is out there building better infrastructure.
They pulled the plug on the stream 40 minutes before the Bitcoin halvening, and subsequently started pulling the plug on people that were part of that livestream.
There is a speculation that YouTube either has some algorithm problems, or they’re playing around, or there is some conspiracy.
But there is a whitelisting process, and many of these companies never went through the whitelist process, and now based on viewers, they hit a certain amount and they start getting looked at and getting locked.
Once they go through the whitelisting process, they don’t have problems anymore. Tone Vays is an example of this. He got blocked, went through the whitelisting process, and hasn’t had any problems since.
We tend to vilify things without having all the information. What Corona has taught us is to not allow yourself to make a decision based on information when you don’t have all the information.
Kevin would say, get whitelisted, and you won’t have any problems. And if you do have problems, you have a leg to stand on to actually complain.
Kevin to his buddy Nouriel: Kevin can’t stand when people make decisions based on “information” when they don’t have all the information, or they refuse to ignore some of it to make their point legitimate.
The plunge to $8k does not prove, at any stretch of the imagination, that Bitcoin is whale-controlled and manipulated. However, it doesn’t prove that it isn’t.
This is the type of data you can look at and prove your point at a high level, regardless of which side of the fence you are on.
This does not prove that it is whale-controlled and manipulated. What happens when the DOW falls by 700 points and we have a stop-out, a circuit breaker. Had the circuit breaker not been there, how far would it have gone? Would it have been able to fall the same 20–25%? Yeah, because it was almost there already. Does that mean it’s controlled by whales? No! It means it’s controlled by scared investors. Most investors in Bitcoin are retail. Retail tends follow to each other. They’re sheep. That’s what they do by definition. They’re not smart money, by definition. Dumb money follows dumb money. Smart money follows smart money.
Kevin thinks he can say “I told you so” on this one. If we go back to when everybody was touting that Telegram was going to be able to beat this, and Kevin initially said that they knew that the SEC was coming and they purposely waited to tie in Telegram into the offering by way of their ToS, because they had a plan that they probably would only have to refund US contributors and still have the rest of the money.
They abandoned that, and decided to just give up.
At one point, there was a Telegram case, and two other cases. And Kevin said they were pretty much slam dunks, no way that they were going to win the case. And Telegram shows at this point that they rather not have the SEC digging into that offering, and finding some illegalities, and hitting them with something that might land them in jail.
Kevin would say that potentially could be a victory as well for other ICOs. They took down a big fish, and are making some precedence.
While Kevin would like to tout this as really big and great news, he doesn’t see it that way. Sometimes he might come off as a pessimist, but he means to be a realist.
When you talk about big corporations, what the CEO says sometimes has absolutely nothing to do with the operations that are happening. It’s just his opinion. His opinion may count towards the opinion of the corporation.
No smart investor is going to come on national TV and give you a hint at what they’re doing. Especially when they see dramatic upside in the future, because they want most of that dramatic upside they can get.
The more buyers that come into Bitcoin, short term maybe the price rises, but also means more people have the ability to sell.
When Jamie Dimon came out and said screw Bitcoin, it didn’t work — they were already researching blockchain and digging into making their own stablecoin, for sure. This is not a big pivot for them. It’s a natural progression.
Banks don’t make money from crypto exchanges. The money that sits with the crypto exchanges is probably in trust, for the end clients. Meaning the bank can’t loan it out, the bank can’t add it to their available loan balance, they can’t fractional reserve on that money. And those companies aren’t taking loans from the bank. So the bank is making transactional income. And as this is mostly in the US, the bank is making cents.
They’re doing this for another reason. They specifically picked two companies with BitLicenses, to pilot with. Probably to find new partners to expand their own smart token that they created, or perhaps integrating some type of staking or interest-bearing profit. And the bank needs the assistance of these companies to do it, and to get them in the door, they give them banking services.
So, not big news for crypto in general. Doesn’t mean that the day is coming where JPMorgan is going to be banking all crypto exchanges.
This one is kind of interesting. Carta is a company that basically does cap table management, as well as securitization or the electronic version of stocks, for private companies. So if you have a big private entity and you don’t want to public, but you want to be able to have a captable and an electronic stock that people can trade — you can do it there.
Most of these are big companies that just haven’t gone public yet. 14 000 companies and they’ve issued billions and billions worth of private stock.
Nasdaq has a private company, called Private Market, which allows private companies to issue stock and run cap table management. And this startup wants to compete with them.
It’s similar to what the CSD and CoinMetro wants to do, with a major caveat — we are going crossborder and global, these guys are basically staying in the US, and they only deal with private companies.
Kevin would expect this to become contested. There are so many banking consortiums and central banks looking to do CBDC, and so is Libra. So it depends on how they structured it.
Great for them if they get the patent, because many, many of this type of stablecoin is going to come out in the future for many different companies, especially for performing instantaneous settlement and so on.
But let’s see if the patent actually gets approved first.
This guy’s assumption is that $1 trillion worth of dollars is leaving equities, which is definitely not the case because a lot of that money has flown back into that market, and the governments have been pumping in money as well.
He’s assuming that a good portion of that is going to end up in Bitcoin. Kevin’s question would be, why would he make that assumption?
We have seen movements in equities, commodities, bond markets, treasury markets, we’ve seen a global recession and different micro and macro things around the world in different regions. And we have not seen what he’s predicting. And now he’s assuming we’re going to see it.
Most money inequities are tied to traders. Traders using a platform they already know. So maybe they’re buying derivatives of crypto. That is not going to affect the underlying price, as if they bought deliverable Bitcoin. So it doesn’t necessarily mean an influx in pricing.
Next “This Week in Crypto” with Kevin is LIVE on our Youtube channel on Friday!