Microsoft filing patent for Cryptocurrency and Mining System, Binance’s CoinMarketCap acquisition and more… |Crypto Market News
Thrilling market news with CoinMetro’s CEO, Kevin Murcko in This Week in Crypto!
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Crypto Market News Highlights
Not much to say about this one. Big tech companies file patents all the time for things that they don’t even know that they are ever going to create, on the off chance that someone does create it and it fits within their patent-framework and they get paid for it and can sue. Lots of these big companies actually make a good amount of revenue from patents that they hold but never created, but someone else did.
Apple, Samsung, Microsoft, IBM, all these guys hold patents to products they never created, and sometimes even knowingly that they never were going to create them — simply on the off chance that somebody would create it in the future.
Kevin doesn’t think they are actually trying to develop this, but they’re hoping somebody might in the future.
In the current state of affairs, Kevin wouldn’t trust the liability sheets — in lots of companies.
As we talked before, the “conspiracy theory” that the Bitcoin jump to 20k was partially due to the fact that Tether was simply made out of thin air, which was then used to buy Bitcoin.
It’s a pretty good conspiracy theory. Maybe it’s partially true. If you believe that theory, then Tether printing some more right now when Bitcoin was at a low that it hadn’t seen in quite some time, could make sense.
Tether said that they aren’t 100% backed by USD, but also backed by “Bitcoin and other assets”. Imagine this scenario: they create Tether out of thin air. Let’s say 1 billion. They buy Bitcoin at 3.7k. Bitcoin doubles in value. The Bitcoin they bought with the Tether is now worth 2 billion. 1 Billion as backing, and 1 billion extra. That could explain why they changed from just being USD backed.
No it’s not. Kevin can go out on a limb here and say that Binance is going to fuck CoinMarketCap up. CoinMarketCap was already pretty fucked up. Their data was shit, mainly because they got data from unregulated sources that could send any data they wanted. They tried to make certain amends to make that data more accurate, but what they did doesn’t really make a difference.
Why do they want to buy CoinMarketCap? Because it’s the most visited property in crypto. It’s ranked 500 in the world most visited websites. Binance’s main subset of clients they are going after, is retail users. Retail guys look at CoinMarketCap. Institutional guys, or pro retail guys, they know that CoinMarketCap is bullshit. You can’t trust what you see on CoinMarketCap. That doesn’t mean everything on there is wrong. But it means that there is no way to vet what is right or not. So why look at it?
Either way, retail guys look at it. And Binance gets most of their volume from retail guys. So, they just bought the most coveted traffic generating website in crypto. Will they put Binance ads all over the place? Kevin doesn’t think so. They are going to maintain the top spot in volume, so now they get the same advertising but at the same time they will be able to add in different metrics that show Binance at the top. So you are going to see Binance on the top of all these different metrics that they are going to be able to produce, and Binance will get a lot of traffic.
This is not anything new. When companies get liquidated, you are talking 3–5 years to get any money back. If you get any money back at all.
Most of these liquidators never had to liquidate crypto. They are used to dealing with “we have to find 100m euro. We found 25m in cash and 25m in assets. Everybody gets half of what they initially had on their accounts”. Easy.
Now they have crypto. “This guy put in a Bitcoin, but the Bitcoin was worth $300 at the time. Now we recovered 80% of that Bitcoin, but now it’s worth much more. Are we going to give this guy back the euro value, dollar value, yen value, or the Bitcoin value? We have to transfer the physical Bitcoin, can we actually do that? What are the laws around that?”
So, this will take much longer than a normal liquidation effort. Don’t hold your breath.
Egypt, just like several countries in the world — and probably more to come — are limiting the accessibility to cash at ATMs and banks. Because they are fearing bankruns. They fear that people will want to go to cash, since people feel safer with cash in the hand. For some reason.
They are not the first and not the last. And Kevin thinks we will see first world countries start doing the same thing, simply because they won’t have enough physical cash. This depends on how long this pandemic continues, and how scared people get from the media.
Sure, you can access your Bitcoin, but so what? Everybody in the world seems to think that the best commodity is toilet paper. Do you think those toilet paper sellers are going to be accepting Bitcoin in a crunch?
Kevin knows Tone Vays. They’ve had a lot of conversations. Maybe Tone is going to hear this — but it’s hilarious when analysts go out and give “likely” price predictions. Because then they are right regardless. We “likely bottomed, but it’s possible we go down to 2k, but even if we do, I would still be bullish long-term”. In a nutshell.
Kevin thinks it’s still in the cards that we will go lower. We went lower on a knee jerk reaction based on the fact that all markets went to shit. Now we are starting to see that the markets are not sure where to go.
But understand that the economy in the entire world, on paper, is going to get extremely fucking worse. And in times like this, people run to cash, then say “wait a minute — the market is stabilizing, I don’t want to be all in cash, I want to be able to recoup some of my losses” and then more losses come, and they go harder to cash.
Kevin wouldn’t place any big bets that we’ve seen the bottom yet. Today’s price action doesn’t matter. No one is really thinking about the full repercussion on what’s going to happen here with massive layoffs. A large number of people around the world are employed by SMEs. Small to Medium Sized Enterprises. Those guys are not going to get bailed out. $1200 from the US government, or some loan guarantee, won’t do shit to stop these businesses going out of business.
Those are also niché jobs, jobs that can’t be replaced right away. Amazon hiring 100,000 people isn’t going to bring those jobs into the marketplace. There are going to be repercussions across industries that have never really seen a hit. Commercial real estate — imagine all these big corporations that can’t pay their rent in all these corporate buildings.
The economies are going to get shitty. And why would you run to Bitcoin? You have no job, you have no income, all your investments are down 40% — why the fuck would you put that into another speculative asset? How does that make sense? It doesn’t. So why would that be the bottom, based on fundamentals? On technicals, you can make an argument on a million things that it was the bottom.
Kevin isn’t saying it’s guaranteed going lower, but he wouldn’t want to be on the buyside now either. Kevin would be hands off all markets. Unless in a market, like some stock that really bottomed out. If a stock drops from 50 eur to 2 eur, the risk is pretty minimalized.
The risk to the downside of Bitcoin is not minimized. In fact it’s even worse today, because the price is up.
When it comes to news, you have things like NFP (Non farm payroll) in the US. Or changes in jobless claims. You know the news is coming. 2–3 days before the news, you get analyst predictions that generally are in the same ballpark. But there is always a chance it’s going to be different. That’s why it can affect the market. The chance is what affects the market. It’s not the news that affects the market.
Here, we know when the news is coming. We know what the news is. And we know what the outcome is. 100%. How is this not priced in? It may take time to price in. Miners may need to start liquidating some of their miners, they may need to downgrade or upgrade — and that can be priced in over time. But it’s priced in. 100%.
We are going to see some jerky moves around the halvening. “Today is the halvening! It has happened!” and people that don’t really understand what that means, or have been watching analysts make stupid predictions, they move their positions around.
Want to read more about the Bitcoin Halvening?
Happens all the time. Portfolios drop assets. Why is it news in crypto? Because it’s an illiquid market. Imagine if Grayscale said tomorrow “no more Bitcoin” and just dumps $3b into the market. That’s scary in these times.
People say that the price drop was because of institutional money, and other people say it was retail money — but here we see one portfolio decides they are out of one crypto asset, and it makes the news.
If one portfolio dropped gold, no one would care. Unless it was one of the usual goldbugs.
So this is a good example for people who think that crypto can weather the storm of global economical impact.
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