March 2, 2021, 2:20 am 0 share Facebook
Between Musk, Yellen and the Bitcoin government
Donald Trump left for history the memory of a government of “America first” through tweets.Elon Musk, known as the «Silicon Valley Iron Man» and CEO of Tesla, repeats the strategy at the business level and with an investment of 1,500 million dollars in bitcoin, announced on the same social network, he shot the star cryptocurrency to his all-time high last month.
The consequence has been that Bitcoin again broke records and managed to exceed $ 58,000, more than a 90% revaluation, in February 2021.It has grown incredibly more than 200,000% in the last 8 years, with a market capitalization touching the trillion dollars.Musk also upped Dogecoin and Ethers on Twitter, achieving never-before-seen appreciations.But the real success has been to encourage institutional investors to see in cryptocurrencies investment potential, a safe haven asset or another means of payment.In this sense, at a business level, so far this year we must add, for example, that MasterCard has announced that it will operate with cryptocurrencies as Paypal has already done.
BlackRock, JP Morgan, Deutsche Bank, Citibank, Gazprombank and BBVA also support crypto investments .In recent days, we also attended in Spain, the launch of an investment fund based on crypto assets, promoted by Avenue Investment Crypto, a boutique specialized in alternative investments.
“All this is launching a signal of confidence among large institutions and the feeling of Fomo (staying out) when it comes to investing in crypto is attracting large corporations to continue investing in bitcoin,” explains Raúl López, country head of Coinmotion in Spain..The crypto sector has seen unprecedented events .Also phenomena such as wallstreetbeat has attracted investment to cryptocurrencies for retail investors, even the recent summit organized by MicroStrategy in which more than 8,000 investors gathered has been gasoline to boost the crypto market.
Read more A highly speculative asset?
The truth is cryptocurrencies are not exempt from registering strong volatilities, in a matter of hours, with corrections that generate panic especially among retail investors.Following bitcoin’s all-time high and euphoric, US Treasury Secretary Janet Yellen noted that bitcoin is still not established as a payment method and is “an extremely inefficient way to carry out transactions.”
It is not the first time that the former head of the Federal Reserve has declared that she does not hold cryptocurrencies in high esteem.However, Yellen remains optimistic in favor of continuing to explore the possibility of a “digital dollar”, maintained by the Federal Reserve and based on Blockchain technology like all other cryptocurrencies.
In this sense, Javier Castro-Acuña, Business Controller director of Bitnovo, explains that “The fall in prices of bitcoin and the rest of cryptocurrencies in general, has nothing to do with Yellen’s statements because, if it were, it would be something sustained when talking about the alleged deficiencies of bitcoin .On the other hand, yes, during the days of fall after the historical maximum, movements of about 60 thousand bitcoins were registered that went from private wallets to being on exchanges.
A movement that indicates that there are investors who want to make cash and this does influence bitcoin corrections ”.
Cryptocurrencies are nerve-racking for central banks and regulators; but they are stepping harder on the accelerator of the cryptoeconomy.In Spain, the CNMV and the Bank of Spain point out its “extreme volatility, complexity and lack of transparency that make them a high-risk bet “, as an investment and a means of payment.
However, they recognize that crypto assets and Blockchain technology may contribute to revitalize and modernize the financial system in the coming years.
Certainly, the lack of regulation is a handicap that the market players themselves claim .In this sense, Castro-Acuña values very positively that both the CNMV and the Bank of Spain consider crypto assets to modernize the current financial system.“We would also like to see more advances in regulation to be able to compete on equal terms with other countries that are taking steps in that direction, supporting innovation.” Bitnovo wants to become the first regulated company in the sector in Spain, for which it has submitted to the Sandbox a proposal within the regulatory scope of cryptoactive service providers.The crypto cake is also desired by investors in Spain
All the advances of the cryptoeconomy in regulatory matters will benefit a new ecosystem that includes more disruptive companies than those specialized in financial services.Spain registers 127 companies in the field of cryptoeconomics, out of a universe of 400 companies in the Fintech industry, according to the “Crypto Spain Business Guide”, prepared by Digital Asset Institute, Crypto Plaza and QUUM, (as of January 31, 2021) .
By company origin, Of the 127 companies that make up the cryptoeconomy map, 80% are Spanish and according to the province of origin, Madrid, Barcelona and Valencia account for 73% of the ecosystem.Foreign companies that are committed to promoting their business in this sector come from the United States, Argentina and Estonia.
Within financial services companies, which includes Exchange, Payments and Transfers, Scoring, Wallets; the Banking and Retail Crypto categories are those that are estimated to have the highest turnover.For its part, in the category of non-financial services companies, such as Artificial intelligence, Big Data, Certification, Consulting and Media & Entertainment, they are also contributing to Spain becoming an international benchmark in financial innovation.
An ecosystem of companies that makes use of blockchain technology, cryptocurrencies, asset tokenization, decentralized finance (DeFi) to build better services.These companies are creating more than 1,200 jobs, modernizing the Spanish financial sector, seeking and claiming a controlled and safe environment, with an estimated annual turnover of 328 million euros at the end of last year.
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