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“For governments, fighting the coronavirus pandemic is like fighting a war,” writes CoinDesk’s Bradley Keoun.
Some argue one of the casualties in this fight may be the U.S. dollar’s long-standing dominance. To combat record levels of unemployment across the world, countries are preparing stimulus packages that will stretch already heavily indebted government balance sheets.
So far, inflation is muted in the U.S., despite the Federal Reserve’s pledge to provide unlimited liquidity to the financial system, which could, in time, drive prices up. Though monetary carnage is already being inflicted on some of the world’s poorest countries, as spooked investors pull money out of emerging-market currencies to flee into U.S. dollars.
What the world looks like after these economic mechanisms shake out is up for debate. However, as officials begin envisioning what it might take to rebuild damaged economies and restore society to a semblance of normalcy, speculation is mounting that seismic shifts might be in the offing for the global monetary system — a phenomenon that historically has occurred in the wake of world wars.
“I wouldn't rule out anything at this point,” says Markus Brunnermeier, a Princeton University economics professor who has advised the International Monetary Fund, Federal Reserve Bank of New York and European Systemic Risk Board. Including, a “Bretton-Woods” style shakeup that could dethrone the dollar. Full story
If the dollar loses dominance, that doesn’t mean bitcoin will take its place. Gold and oil are the safe harbor assets bitcoin was supposed to become. A confluence of forces – ranging from imminent CBDC adoption to a decline in retail use for cryptos – have left bitcoin languishing. “Bitcoin was supposed to be the digital gold,” Michael Sung, a professor at Shanghai's Fudan University, said. “But there are all sorts of weird dynamics where it’s now unclear if bitcoin has that privileged status as a flight to safety.” Oil and BTC don't mix?
One retail outlier is Coinbase Commerce, which has now processed $200 million in total transactions. The commerce wing of the exchange giant has also integrated 8,000 retailer partners. Commerce during COVID
Banking incumbent HSBC has put $10 billion of paper-based private placement records on R3’s Corda blockchain and plans to ramp up the project through this year and next. “We’re confident that we’ll be able to put significant additional volume and value of private placements from new and existing clients [on the platform] over the next 12 to 18 months,” said Ciaran Roddy, head of custody innovation and strategy initiatives at HSBC. Taking paper digital
‘Big Four’ accounting firm EY will turn over QuadrigaCX user account information over to the Canada Revenue Agency (CRA), as requested by the agency. This will include account balances and transaction data. Customers of the defunct exchange have waited more than a year to get back $190 million lost under suspicious circumstances. Taxman looketh
Though it’s not just legacy firms making waves. Blockchain startups see opportunity in connecting plastics refining companies with recycling plants in a bid to reinvent current supply chains. Blockchain’s appeal here: measuring action and demonstrating it to the public. “It’s a hard goal, but eventually you could show how consumer plastics from waste collection companies can be added into your supply chain as raw materials,” Miguel Pérez said. “It’s the next step in the process of tracing assets and linking supply chains.” Plastics changes
Venezuelan President Nicolas Maduro used crypto to conceal illicit drug-running crimes, the U.S. Department of Justice alleged in an indictment Thursday. He is now being indicted on sweeping charges, along with 14 other Venezuelan officials, related to an alleged multibillion-dollar cocaine trafficking ring the DOJ claimed wreaked havoc on American communities for over 20 years. Cryptic cartels |
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Governments around the globe are surveilling mobile phones to track the spread of the novel coronavirus. There's risk these new, invasive measures will become the norm. (Decrypt)
We just glimpsed how a “digital dollar” might work, thanks to coronavirus. (MIT Technology Review)
Ripple and Coinbase get license exemptions in Singapore for a limited period. (The Block)
KB Kookmin, the largest bank in South Korea, is set to launch a custody service for crypto assets. (The Block) |
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| Bitcoin may not be out of the woods yet, but prospects of another sudden price crash now look to have diminished. A 30 percent decline in exchange deposits in the last 12 days signals investor confidence in the long-term viability of bitcoin. The top cryptocurrency by market value is currently trading near $6,700, representing a 70 percent gain from the low of $3,867 seen March 13, though a move above $7,000 is needed to revive the recent recovery rally. Confidence grows
While bitcoin is looking bullish, miners have increased their selling. Mining pools account for the highest percentage of bitcoin flowing into exchanges and have significant influence on prices. Yet, some view the market’s reaction as a positive indicator. “When the price of bitcoin can rally sharply from the local lows and buyers can absorb the extra bitcoin sold by the miners with little impact, it is a sign of strength in the overall market," Connor Abendschein, crypto research analyst at Digital Assets Data, said. Bitcoin flows
Still, Digital Farms, a California-based cryptocurrency mining company, is putting its operations on hold due to the recent decline in bitcoin's price. On March 18, the miner's parent company, investment firm DPW Holdings, filed an update with the U.S. Securities and Exchange Commission (SEC) on its business related to the COVID-19 pandemic. Mine closed |
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Different countries, states and cities are taking varied approaches to suppressing and overcoming the novel coronavirus. Singapore is deploying wide-ranging testing, while New York state has issued a "shelter-in-place" ruling. CoinDesk is looking to gauge reader sentiment on how their governments are handling the COVID-19 outbreak. Take our five-minute reader survey here.
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| The Federal Reserve has recruited asset management giant BlackRock to administer three programs in a $2 trillion dollar stimulus package. Though, “under the arrangement, [the firm] could buy its own funds on behalf of the central bank,” Bloomberg reported. Meltem Demirors, chief strategy officer at CoinShares, joins Nathaniel Whittemore on the latest episode of The Breakdown to discuss how this financial giant ended up on both sides of the bailout. Crrrrony capitalism? |
WHO WON #CRYPTOTWITTER
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Dollar dilemma