Last week pizza, now eggs. I watched Jen Psaki’s inflation announcement on Twitter while I stood in my local grocery store in front of a cage-free dozen. As I registered her announcement anticipating higher inflation rates on energy and food due to global churn, I clocked the prices. One dozen eggs now costs roughly $8 in a New York supermarket—that’s insane, even for organic. I’m not the only one who’s noticed, with Federal Reserve Governor Lael Brainard saying that "bringing inflation down is of paramount importance." Currently, inflation is surging to rates not seen since 1981. (Coindesk)
Despite some mild market consolidation after Bitcoin touched the mid-forties earlier this week, investors remain hopeful. Cathie Wood, CEO of Ark Invest, went as far as projecting Bitcoin at $1 million by the year 2030. This kind of statement makes sense coming from Wood, she being a strong advocate for crypto from its nascent stages. (Cointelegraph)
Wood also told a CNBC reporter this past Thursday that “banks have a big problem” due to their lack of involvement in crypto, particularly in DeFi. People are shifting their attention away from the traditional market because it’s no longer meeting their needs.
DeFi can offer lending and borrowing that is usually reserved for the ultra-wealthy under current standards, serving as a breeding ground for equal opportunity. When you look at the recent WUWR from Wealth-X, it shows how the ultra-rich only managed to get richer over the course of the pandemic. It’s no wonder that citizens are turning to crypto to level the playing field of wealth building opportunities.
Bank of America is among the many banks that are changing their tune on crypto. BoA sent a note to its investors harboring a sense of certainty around the economic consequences of inflation, using words like 'inflation shock' worsening, 'rates shock' just beginning, 'recession shock' coming." Their prediction? That assets like crypto will outperform the traditional equities market. This is a full 180 from the bank's initial stance on Bitcoin. In March 2021 they wouldn’t touch it with a 10-foot-pole because of volatility—now they think it’s the answer, and they're not alone. (Cryptopotato)
BlackRock also stepped further into the world of crypto this week, partnering with Circle in the platform’s next $400 million funding round. BlackRock already provides cash reserves to back Circle’s stablecoin, USD Coin (USDC), but now they also work to identify capital market applications for the asset. Stablecoins are seeing increasing popularity amongst investors, with USDC being the second-largest stablecoin by market cap.
“This funding round will drive the next evolution of Circle's growth,” said Circle co-founder and CEO Jeremy Allaire. “It's particularly gratifying to add BlackRock as a strategic investor in the company. We look forward to developing our partnership.” (Cointelegraph)
Investors continue to gravitate towards NFTs, as is proven by Genies, the avatar platform that just reached a $1 billion valuation after raising $150 million in its Series C funding round. If you remember Dollz from about 20 years ago, Genies brings back those early-2000s vibes with its avatar NFT ecosystem. Their goal is to appeal to a Gen Z audience and, according to Silver Lake co-CEO Egon Durban, “make it possible for people to build the avatar ecosystems that we believe will drive the next evolution of human expression, communication, and creativity.” (Decrypt)
While NFTs are gaining momentum, Bitcoin is still the most popular inflation hedge, and people and institutions alike continue to accumulate. While this might not be apparent when you look at Bitcoin’s price, while price-action takes a breather, it is when you look at the hash rate. Mining difficulty is at an all-time high, with Glassnode reporting miner revenue as “up 150% compared to after the last halving event.” For any who don’t know, when you mine Bitcoin, you get Bitcoin. In this instance, difficulty is a good thing, because it's an indication of how rapidly the mining industry is growing, as well as the race to mine as much of the 2 million Bitcoin left to be minted into circulation. (Decrypt)
Some countries are turning to crypto at a larger scale to actively combat inflation, such as Serodino in Argentina. The town plans to install mining rigs to help pay for infrastructure upgrades and even to pay taxes. Mayor Juan Pio Drovetta spoke to concerns over using volatile assets as an investment tool for his people:
"We are not buying cryptocurrencies and looking to make a profit on a speculative move whereby we [either] win [or lose]. What we will be doing is generating cryptocurrencies, so we will always win." (Cointelegraph)
Inflation isn’t going anywhere, but solutions through crypto can ease the fiscal pain of the hemorrhaging economy. For countries developing a winning strategy, crypto seems to be the best bet for innovation and progress, when many may feel as though we’re moving backward. When it comes to building a better future, one where necessities are affordable, we believe in Bitcoin.
Top market movers as of April 15, 2022
- ApeCoin (APE) +13%
- KNC Legacy (KNC) +12.9%
- Shiba Inu (SHIB) +8.4%
- Monero (XMR) +5%
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