Markets

The banking and cryptocurrency markets may be more symbiotic than you think

Published

8 months ago

1 June, 2024

The banking and cryptocurrency markets may be more symbiotic than you think

Many assumed that the advent of cryptocurrencies heralded a revolution in finance. The truth may be that cryptocurrencies’ overall impact on the financial services industry is more evolutionary than revolutionary, writes Circle’s Dante Disparte.

bychykhin – stock.adobe.com

The promise of cryptocurrency is to democratize financial services that would otherwise be captured by brick-and-mortar banks or product classes that require money to make money. The promise of blockchain it’s a third generation of the Internet, what can it be called Web3, that allows people to read, write and own digitally scarce content and resources. Cryptocurrency advocates argue that this amounts to nothing less than an anti-establishment revolution that allows people to forego traditional political economy and opt for technology-based economic self-sovereignty. As the market losses and enforcement actions As the last two years have shown, the durable parts of cryptocurrencies (no more monolithic than banking) may be more evolutionary than revolutionary in financial services. This is a good thing for markets and players looking to revolutionize financial services with new technologies.

Having a forward-looking view of evolutionary innovations in the banking sector is significant. For example, far from a world of always-on financial services, banks have had to undergo profound business model innovations that have broadened their reach while reducing the cost of being a bank – a segment of the economy that enjoys the necessary public support, thus imposing conservative prudential and risk management standards. As the economy has changed over the last 100 years, consumers have demanded access to their money beyond the 9-to-5 banking hours, with a variety of holidays in between. Arguably the combination of labor laws, efficiency and cost reduction resulting from the move from a human teller to the automated teller machine, invented in the late 1960s, is an example of evolution rather than revolution.

With the proliferation of ATMs, the ability of banks to meet their increasingly dynamic customers wherever they were – at a petrol station, traveling abroad or at the oddest hours of the day – was a game changer. The turning point lies in the evolution of the physics of banking and money, while respecting a rules-based economy. The subsequent extension of this model has seen the rise of e-commerce force banks to face a potential “adapt or die” moment, as the growth of internet-scale economic activity has triggered a wave of fraud has metastasized into today’s virulent version of cybercrime. Banks and financial services companies faced a difficult choice: absorb fraud risks by offering customers a zero-liability proposition, or miss out on a permanent transition of the economy to an Internet-based services sector and rise of globalization.

Evolution, not revolution, followed, and in the meantime the number of banks in the United States began to decline from beyond From 14,000 in the 1930s to around 4,100 today, the banking sector is not dead, it has evolved. This evolution required moving towards an ever-active and more open banking environment, powered by the Internet, as part of the technological base that would not only power the economy, but also the banking sector. Insidiously, not all banks, even surviving ones, can keep pace with digital transformation and the cybersecurity arms race, and a bank failure undermines trust in the banking sector. Today, not only is it normal in banking to have account access via the Internet, but also the ability to make transfers, move money between accounts, check balances or apply for a loan, among other integrated services, is the basis of survival.

While many banks are keeping up with the evolution of internet banking, much of the core of banking remains unchanged. Even in the most technologically advanced bank, making a wire transfer is still similar to the landline era. The longer the call travels over the fixed infrastructure, the higher the costs. In banking, the faster a customer needs a payment, in no small measure because the speed in today’s banking system requires staff and overhead, the higher the cost. These activities are further hampered by antiquated or proprietary technologies, which conspire to create a veritable walled garden in financial services. This walled garden imposes the highest costs on the people who can least afford it, even for basic financial services. As an example of legacy technology debt, ACH, Swift, and other interbank payment networks were born in the 1970s. For example, most of these networks and even their public alternatives such as FedNow, launched with a pilot group in July 2023, still propose closed value transfer networks.

It would stand to reason that the advent of mobile-enabled digital wallets and open blockchain ledgers would be seen as revolutionary and potentially anathema to the security and soundness of the banking industry. But, as 2022 has taught us, perhaps cryptocurrencies and banking are not pitted in a vicious deathmatch, but rather present a symbiotic business upgrade as the internet and ATMs did in the past, and as banking services do now mobile. In fact, cryptocurrencies may need banks more than banks need cryptocurrencies; However, in order for the world to make material progress where banking and financial services currently fall short, discouraging responsible technological innovation, especially in areas that can clearly extend the perimeter of the formal economy, it would be short-sighted not only for banks and their regulators, but for the economy in general.

Emerging technologies can often be scary and unsustainable, especially for an industry that must be risk averse by design and regulation. The migration from proprietary server farms to cloud computing was also terrifying. Today, however, cloud computing and all the related tech jargon have faded into the background, and banks, businesses, markets and consumers are better off. The same transition is underway with blockchain-based financial services, as a wave of institutional adoption gains speed. Just like the dawn of the Internet or Wall Street’s continually checkered scorecard, normalizing and managing new technological risks requires banks and non-banks to innovate, collaborate and compete. Indeed, considering the technology and vendors with which most US banks operate, the advent of open source systems should be welcome, even if the first waves of development of the so-called Internet of Value left much to be expected.

Fuente

Related Topics:Banking technology blockchain cryptocurrency

Up Next

Singapore’s largest bank, DBS, holds nearly $650 million in Ether (ETH): Nansen

Don't Miss

Bitcoin (BTC) Price Recovers From Weekly Low, Ethereum (ETH) Targets $3.8K (Weekend Watch)

Financial Block Staff

We are the editorial team of Financial Block, where seriousness meets clarity in cryptocurrency analysis. With a robust team of finance and blockchain technology experts, we are dedicated to meticulously exploring complex crypto markets with detailed assessments and an unbiased approach. Our mission is to democratize access to knowledge of emerging financial technologies, ensuring they are understandable and accessible to all. In every article on Financial Block, we strive to provide content that not only educates, but also empowers our readers, facilitating their integration into the financial digital age.

Click to comment

Markets

Bitcoin, Ethereum See Red as Markets Crash on Volatility

Published

6 months ago

1 August, 2024

Financial Block Staff

Bitcoin, Ethereum See Red as Markets Crash on Volatility

Bitcoin AND Etherealalong with the rest of the top 10 cryptocurrencies by market cap, appear to be in hibernation on Thursday morning.

At the time of writing, the Bitcoin Price is still below $65,000 and 2.2% lower than it was this time yesterday, according to CoinGecko data. Things are worse for the Ethereum Pricewhich is 3.7% lower than 24 hours ago at $3,185.22. The drop in ETH’s price is identical to that of Lido Staked Ethereum (stETH), a liquid staking token for Ethereum.

In recent days, falling prices have led to the liquidation of derivative contracts worth $225 million, according to Coin glassAnd about half of that, about $100 million, was liquidated in the last 12 hours.

When a trader is liquidated, it means that their position in the market has been forcibly closed by an exchange or brokerage due to a margin call or insufficient collateral. Margin is especially important when it comes to leveraged positions, which allow traders to control a multiple of their deposit, such as opening a $10,000 position with only $1,000 in their account.

Now that Bitcoin has been in the red for three days in a row, there is a chance that the world’s oldest and largest cryptocurrency could sink even further, BRN analyst Valentin Fournier said in a note shared with Decrypt.

“Bitcoin has closed in the red for three days in a row, with one-way trading showing limited resistance from bulls. Ethereum had a slightly positive Monday with strong resistance from bears who have won the last two days,” he wrote. “This momentum could take BTC to the $62,500 resistance or even the $58,000 territories.”

Looking ahead, Fournier said BRN’s strategy will be to “reduce exposure to Bitcoin and Ethereum and find a better entry point after the dip.”

This is despite Federal Reserve Chairman Jerome Powell’s comments yesterday on interest rates being widely regarded as accommodating and indicative of FOMC rate cuts in September.

Singapore-based cryptocurrency trading firm QCP Capital said the rally in stocks, which sent the S&P 500 up 1.6% from Wednesday’s close, was not felt in cryptocurrency markets.

“Cryptocurrencies have seen a broad sell-off overnight and into this morning,” the firm wrote in a trading note. “The market remains poised as traders pay close attention to daily ETH ETF outflows and further supply pressure from Mt Gox and the US government.”

Meanwhile, the other top-ranking coins are showing mixed performance.

Solana (SOL) is down 7.2% since yesterday to $169.13. Things are even worse for its most popular meme coins. In the past 24 hours, the most popular meme coins Dogwifhat (WIF) are down 12% and BONK (BONK) is down 9%, according to CoinGecko data.

Their dog-themed competitor, Ethereum OG Dogecoin (DOGE), the only meme coin in Coingecko’s top 10, is down nearly 4% since yesterday and is currently trading at $0.1205.

XRP (XRP) dropped to $0.608, which is 7% lower than it was at this time yesterday.

Binance’s BNB Coin (BNB) has kept pace with BTC and is currently trading at $571, down 2.4% from yesterday. Toncoin (TON), the native token of The Open Network, is down just 0.4% over the past day.

This leaves the stablecoins USDC (USDC) and Tether (USDT), both of which are stable as they maintain their 1:1 ratio with the US dollar.

Fuente

Markets

XRP Market Activity Drops During Ripple-SEC Talks: Price Steady

Published

6 months ago

1 August, 2024

Financial Block Staff

Ripple (XRP) Market Witnesses Calm During SEC-Ripple Meeting

The Securities and Exchange Commission (SEC) will hold another closed-door meeting with Ripple on Thursday, as the market hopes for a possible resolution to the legal battle between the two entities.

However, the cryptocurrency market remains relatively bearish, with the price and trading volume of XRP down in the last 24 hours.

Ripple holders take no risk

At press time, XRP is trading at $0.60. The altcoin’s price has dropped 6% over the past 24 hours. During that time, trading volume was $27 million, down 27%.

The SEC met before with the digital payment company on July 25. While the outcome of that meeting remains unknown, the Sunshine Act Notice for Thursday’s meeting includes one additional topic of discussion from the July 25 closed meeting: the instituting and resolving injunctive relief. That has market participants speculating whether a settlement is imminent.

In an exclusive interview with BeinCrypto, Ryan Lee, Lead Analyst at Bitget Research, noted that:

“This meeting will discuss possible resolution options for the Ripple Lawsuit. The founder of Ripple Labs said that a legal settlement could be announced soon. If an official settlement plan is released, it could positively impact XRP’s price movement.”

However, an assessment of XRP’s price movements on a 4-hour chart shows a spike in bearish bias as the market awaits the outcome of this crucial meeting. Its Moving Average Convergence/Divergence (MACD) indicator readings show that its MACD line (blue) has crossed below its signal line (orange).

XRP 4 Hours Analysis. Source: Trading View

Traders use this indicator to gauge price trends, momentum, and potential buying and selling opportunities in the market. When an asset’s MACD is set this way, it is a bearish signal that suggests selling activity is outweighing buying momentum.

Additionally, the altcoin relative strength index (RSI), at 46.08, is currently below its neutral 50 line and in a downtrend. This indicator measures overbought and oversold market conditions for an asset.

To know more: How to Buy XRP and Everything You Need to Know

xrp rsi XRP 4 Hours Analysis. Source: Trading View

At 43.83 at the time of writing, XRP’s RSI suggests a growing preference among the market participants for tok in distribution.

XRP Price Prediction: Derivatives Traders Exit Market

The XRP derivatives market has also seen a decline in trading activity over the past 24 hours. According to Coinglass, derivatives trading volume has plummeted 18% and open interest has dropped 10% during that period.

Open interest refers to the total number of outstanding derivative contracts, such as options or futurethat have not yet been resolved. When it drops, traders close their positions without opening new ones. This is a bearish signal that reflects a lack of confidence in any potential positive price movement.

According to Lee, the outcome of the meeting with the SEC “would have a significant impact on the price movement of the token.” If the outcome is favorable, the price of the token could rise towards $0.75 in August.

To know more: Ripple (XRP) Price Prediction 2024/2025/2030

XRP Price Prediction XRP 4 Hours Analysis. Source: Trading View

On the other hand, if no favorable resolutions are reached, the price could plummet to $0.50.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto strives to provide accurate and unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult a professional before making any financial decisions. Please note that our Terms and conditions, Privacy PolicyAND Disclaimers They have been updated.

Fuente

Markets

Bitcoin’s Dominance Hits Three-Year High, But Analysts Say Altcoins Are Ready to Rebound

Published

6 months ago

1 August, 2024

Financial Block Staff

Bitcoin's Dominance Hits Three-Year High, But Analysts Say Altcoins Are Ready to Rebound

Bitcoin is now the dominant force in the cryptocurrency market, surpassing 53% of the total cryptocurrency market, a stronger share than it has been in the past three years.

Bitcoin’s market cap now stands at $1.27 trillion, second according to CoinGecko data. In contrast, the total cryptocurrency market cap is $2.43 trillion, with Ethereum occupying 15.9% of the market, worth $389 billion.

Bitcoin’s rise to dominance this year is unusual, as altcoins typically do better than Bitcoin in a bull market. While meme coins made a strong comeback during Bitcoin’s rally to all-time highs earlier this year, the so-called “wealth effect” It has not been appreciated as much by mid-range coins, such as Ethereum and Cardano.

“ETF flows fundamentally alter market dynamics,” he wrote Meltem Demirors, former chief strategy officer at CoinShares, tweeted Wednesday: “BTC gains no longer translate to alts and the longer tail of crypto.”

Bitcoin’s takeover has continued even as the market cap of Tether (USDT) continues to grow, the world’s largest stablecoin and the third-largest cryptocurrency after BTC and ETH. Stablecoins are backed by fiat currencies and are excluded from some measures of Bitcoin dominance due to fundamentally different value models.

The surge continued to pace even after the launch of Ethereum spot ETFs last week, which ironically culminated in a news sell-off event, and net outflows from new investment products since they were launched. This went against the predictions of K33 Search so far, which predicted that ETFs would catalyze ETH’s growth over the next five months.

Despite the poorer performance of the alts, there is reason to believe that they are ready to bounce back very soon.

CryptoQuant CEO Ki Young Ju said Tuesday that whales are “preparing for the next altcoin rally,” as limit buy orders for assets other than BTC and ETH are on the rise.

The executive shared a chart showing how the “cumulative difference between purchase volume and sales volume” has increased in recent months.

“The indicator measures the difference between buy and sell orders over a year,” CryptoQuant told Decrypt. A buy/sell order is a pre-set request to buy or sell a cryptocurrency if it hits a certain price level, which creates resistance and support levels.

“If the trend is up, it means that more people are placing buy orders, showing strong interest in buying,” CryptoQuant said.

By Ryan-Ozawa.

Fuente

Markets

XRP and SOL Retrace as BTC Price Drops to 2-Week Lows (Market Watch)

Published

6 months ago

1 August, 2024

Financial Block Staff

Bitcoin Returns Toward $60K, XRP Defy Negative Sentiment (Market Watch)

After Monday’s crash, in which BTC fell by several thousand dollars, the scenario has repeated itself once again in the last 12 hours, with the asset falling to a 2-week low of $63,300.

Alt coins followed suit, with most of the market in the red today. SOL and XRP lead the way from the higher cap alts.

BTC Drops To $63.3K

After a violent Thursday last week, when BTC crashed to $63,400, the asset went on the offensive over the weekend and surged above $69,000 on Saturday, as the community prepared for Donald Trump’s appearance at the 2024 Bitcoin Conference in Nashville.

His speech was followed by more volatility before the cryptocurrency settled around $67,500 on Sunday. Monday started off rather optimistically for the bulls as bitcoin hit a 7-week high of $70,000.

However, he failed to maintain his run and conquer that level decisively. On the contrary, he was rejected bad and dropped to $66,400 by the end of Monday. Tuesday and Wednesday were less eventful as BTC remained still around $66,500.

The last 12 hours or so have brought another crash. Bears have pushed the leading digital asset down hard, which has fallen to a 2-week low of $63,300 (on Bitstamp), leaving over $200 million in liquidations.

Despite the current rebound to $64,500, BTC’s market cap has fallen to $1.270 trillion, but its dominance over alts is recovering and has reached 52.6%.

Bitcoin/Price/Chart 01.08.2024. Source: TradingView

The Alts are back in red

Ripple’s native token has been at the forefront of the market challenge in recent days as pumped up to a multi-month high of over $0.66. However, its run was also interrupted and XPR fell by more than 6% in the last day to $0.6.

The other big loser among the larger-cap alternatives is SOL, which has lost 8% of its value and is now struggling to get below $170.

The rest of this altcoin cohort is also in the red, with ETH, DOGE, BNB, AVAX, ADA, SHIB, and LINK all seeing drops between 2 and 5%.

The total cryptocurrency market cap lost another $70 billion overnight, falling below $2.4 trillion today on CG.

Cryptocurrency Market Overview. Source: QuantifyCrypto SPECIAL OFFER (sponsored)
Binance $600 Free (CryptoPotato Exclusive): Use this link to register a new account and receive an exclusive $600 welcome offer on Binance (full details).

LIMITED OFFER 2024 on BYDFi Exchange: Up to $2,888 Welcome Reward, use this link to register and open a 100 USDT-M position for free!

Disclaimer: The information found on CryptoPotato is that of the authors cited. It does not represent CryptoPotato’s views on the advisability of buying, selling, or holding any investment. We recommend that you conduct your own research before making any investment decisions. Use the information provided at your own risk. See Disclaimer for more information.

Cryptocurrency Charts by TradingView.

Fuente