With so much happening in the crypto world right now, I thought I would give you a roundup of the key news from the crypto world for this week. These updates aim to capture the most pertinent stories you should be aware of. If you’re just getting into crypto, then welcome to the party!
The Market Corrects.
As you may well know, the market corrected after a crazy surge in the value of cryptocurrencies which saw an incredible 70% growth in just 3 weeks. It is not surprising that after a big run-up, the market has corrected dropping 20%+ in just a week. This is a natural correction in an uptrend and likely to be temporary. It’s still up 40% in one month and continued market support means that most people see these drops as a good time to buy more.
For Dacxian’s, it’s important to remember that volatility is a feature, not a bug. The high level of variance in these early days of crypto investing is normal and fully expected. If you look at early-stage technology it’s the same thing. We saw huge swings in early tech stocks from Apple to Microsoft to Amazon – long-term hodler’s of that stock are very happy they stayed the course! What I am eluding to is volatility like this is normal for this new asset class and you should just accept it as part of the long-term crypto journey to build wealth.
Rakuten adds McDonalds.
Rakuten is Japan's Amazon and is one of the world's largest eCommerce companies. They have been in crypto for a while and have just announced that they have added McDonald's to the companies that will promote and use their crypto-wallets and coins. By announcing the partnership with McDonald’s, it's a sign of more major names getting involved and highlights this as another reason why cryptos are becoming mainstream. This is a sign that can’t be ignored about the inevitable shift towards digital currencies.
Bitcoin EFT booms in 1st week.
An EFT is an exchange-traded fund that allows institutional investors to buy into an asset with all the benefits that go with trading on the stock exchange. The advantages of EFTs are numerous, including liquidity and market pricing. The first-ever Bitcoin ETF in North America was launched this week and received a staggering $565mn in investments. You're probably sitting there asking, "Why should I care about this?" ETFs must be approved by the exchange regulators and until now they did not license them due to the instability and credibility of Bitcoin. With the first ETF now being launched, more are expected and Bitcoin will get a tidal wave of buying. This is fantastic for anyone owning Bitcoin as this is a new way for more companies to buy the asset driving prices.
Coinbase applies for Nasdaq listing.
Coinbase, America's largest crypto platform, has submitted its application to the list of the Nasdaq stock exchange. The rumored $50bil valuation is very exciting. It is enormously important to Dacxi as it continues the credibility building of crypto in the established markets where trust and security are paramount. The Coinbase listing provides an accredited stamp of approval and this will continue to encourage both retail and institutional investors to explore crypto more seriously.
I think that we all get the feeling that cryptocurrency is breaking out into something special.
May the good times continue to roll.