14 December 2020

Fidelity Digital Assets Custody Bitcoin BlockFi

The correction in the cryptocurrency market has intensified further as the overall cryptocurrency market cap loses 5% or $25 billion in the last 48 hours. Bitcoin, Ethereum, and other falcons are testing crucial support levels at this stage. 

At press time, Bitcoin (BTC) is trading at $18,352 with a market cap of $340 billion. Over the last 48 hours, the BTC price has lost $1500 and is currently trading close to its next support level of $18,000. 

Below is the BTC charts, since the month of October 2020, with two trading lines connecting the tops and the bottoms. Bitcoin is currently trading close to the support line connecting the BTC lows. If BTC price drops below $18K, the next support stands at $16K.

Bitcoin since Oct'20
Bitcoin since Oct’20

Also, Ethereum (ETH) is trading close to its crucial support levels of $560. At press time, the ETH price is trading 1.09% lower at $570 with a market cap of $64 billion. The positive development currently is that the Ethereum 2.0 deposit contracts continue to amass more ETH. 

As per the latest update by Glassnode, the total value staked is 1.3 million ETH tokens (i.e. nearly 250% of the initial phase 0 goal).

Ethereum @ Initial Phase 0 Goal. Image courtesy of Glassnode
Ethereum @ Initial Phase 0 Goal. Image courtesy of Glassnode

Digital asset manager Grayscale continues to purchase more and more ETH as the total assets under management for the Grayscale Ethereum Trust (ETHE) now surge past $1.7 billion. 

Ripple (XRP) Faces Correction In Light of CEO Selling Spree

Ripple’s XRP is facing major feeling pressure as its correct 6.32% in the last 24 hours. XRP has extended its losses and is currently trading at $0.55 with a market cap of $25.2 billion. 

XRP price corrects as former Ripple CTO Jed McCaleb, now the co-founder of Stellar blockchain, offloads 30 million XRP soon after receiving 266 million XRP earlier this week. McCaleb who was part of Ripple’s founding team is taking advantage of XRP’s high prices currently. On-chain data shows that McCaleb has been on a selling spree from the start of this month. 

Grayscale Bitcoin Trust (GBTC) Purchases $2B More ETH

The institutional development in-and-around Bitcoin continues to move ahead as the world’s largest cryptocurrency continues getting support from big financial players. 

The classic Bitcoin vs Gold debate continues as JPMorgan strategists confirm that money going out of Gold since October is going into Bitcoin funds. JPMorgan strategist Nikolaos Panigirtzoglou says that this trend will continue further in the long term as institutional players take fresh positions in BTC. 

JPMorgan further adds that since October 2020, the net inflows in the Grayscale Bitcoin Trust (GBTC) – one of the biggest Bitcoin funds – is $2 billion. On the other hand, $7 billion has flown out of Gold ETFs during the same period. 

Bitcoin and Gold Interplay '19-'20
Bitcoin and Gold Interplay ’19-’20. Source: Bloomberg

JPMorgan strongly believes that Bitcoin will continue to eat into Gold’s market share over the next few years. “If this medium to longer term thesis proves right, the price of gold would suffer from a structural flow headwind over the coming years,” wrote JPMorgan’s strategists.

Mike McGlone, senior commodity strategist at Bloomberg Intelligence also believes the same. He notes that 2020 has been the stepping stone to get Bitcoin in the mainstream investment portfolios. He adds that Bitcoin shall be on an upward trajectory for 2021. 

Billionaire investor Ray Dalio, the founder of Bridgewater Associate who manages the world’s largest hedge fund said that over the last decade, Bitcoin has established itself as a gold-like alternative. 

Dalio’s comments came during the latest Ask-Me-Anything (AMA) session on Reddit wherein he wrote:

“I think that bitcoin (and some other digital currencies) have over the last ten years established themselves as interesting gold-like asset alternatives, with similarities and differences to gold and other limited-supply, mobile (unlike real estate) storeholds of wealth. So it could serve as a diversifier to gold and other such storehold of wealth assets”

Fidelity Digital Assets To Offer Bitcoin-Collateralized Cash Loans

Fidelity Digital Assets, the crypto wing of Fidelity Investments, has collaborated with blockchain startup BlockFi to offer Bitcoin-collateralized cash loans to institutional players. Some of its potential customers would be OTC trading desks, hedge-funds, and crypto miners. 

In an interview with Bloomberg, Tom Jessop, president of Fidelity Digital Assets, said: Holding Bitcoin to back loans is “a foundational capability. As the markets grow, we’d expect that this becomes a fairly important part of the ecosystem.”

However, to get this load, the Fidelity customers need to first have an account with BlockFi. The blockchain startup will offer cash worth 60% of the loan backed by Bitcoin. BlockFi will also risk-manage the volatility of BTC. 

BlockFi CEO Zac Prince said: “The program has room for client-level customization and may be adjusted to meet the needs of large firms”.

In another announcement, British multinational banking giant Standard Chartered said that it plans to launch a Standard Chartered online banking and crypto custodial solution ‘Zodia’ by 2021 – subject to approval by the UK Financial Conduct Authority (FCA). 

Close Bitnami banner
Bitnami