Good morning. Here’s what’s happening:
Prices: Bitcoin rebounded above $20K; ether rises.
Insights: Taipei Blockchain Week is facing a major hurdle in Taiwan's COVID-19 quarantine.
●Bitcoin (BTC): $20,285 +3.1%
●Ether (ETH): $1,547 +7.7%
●S&P 500 daily close: 4,030.61 −0.7%
●Gold: $1,751 per troy ounce +0.9%
●Ten-year Treasury yield daily close: 3.11% +0.07
Bitcoin, ether and gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the COMEX spot price. Information about CoinDesk Indices can be found at coindesk.com/indices.
Bitcoin Returns to Its $20K Perch
By James Rubin
After taking a short Sunday dive, bitcoin returned to its new support level above $20,000.
The largest cryptocurrency by market capitalization was recently trading at about $21,250, up about 3% over the past 24 hours. BTC's resilience offered a sliver of reinforcement for investors who thought the crypto's plunge to $19,500 was a precursor to a bigger drop stemming from Federal Reserve Chair Jerome Powell's vow to continue the U.S. central banks monetary hawkishness.
"Macro [economics] has been in the driver's seat all year, and this week and after Jackson Hole, the market has been reminded that the same type of inflationary headwinds with strong job markets remain," Luke Farrell, a cryptocurrency trader for crypto grading firm GSR, told CoinDesk TV. "You're seeing a little bit of a reassessment of the optimism that came after the CPI print last month and a bit of oversold conditions that started in June."
Ether returned to its pattern of outperforming bitcoin, recently rising more than 7%. ETH is now changing hands well above $1,500 after falling well below this psychologically important level over the weekend. The second largest crypto by market cap has been rising more sharply than BTC over the past couple of months as the Ethereum blockchain nears the Merge, which will change the protocol from proof-of-work to more energy efficient proof-of-stake.
Other altcoins in the CoinDesk top 20 by market cap were in the green, most of them firmly so, with ATOM and LRC recently jumping 12% and 8%, respectively. AVAX rose more than 5%, regaining ground it lost after a self-described "whistleblower" website on Sunday accused Ava Labs, the company behind the Avalanche, the layer 1 blockchain, of paying lawyers to hurt competitors and keep regulators at bay. On Monday, Ava Labs CEO Emin Gün Sirer denied the company has been involved in any behind-the-scenes smear campaign.
Equity markets pointed down ,with the tech-focused Nasdaq and S&P 500 indexes off 1% and 0.7%, respectively. U.S. Treasury yields rose as nervous investors sold off government bonds. On Tuesday, the Conference Board releases its monthly consumer confidence index, a widely watched measure of sentiment about the economy. The group's last report in July found confidence waning, albeit at a more moderate pace than in June when inflation hit 9.1%.
In its weekly fund flows report, CoinShares noted a third consecutive week of outflows totaling $46 million. The report said that $29 million in bitcoin outflows made up the largest portion of this sum. "[O]ur latest @CoinSharesCo fund flows report in two words: investor apathy. no near-term catalysts on the horizon and so we wait...," CoinShares Chief Strategy Officer Meltem Demirors tweeted.
GSR's Farrell said that volatility should remain "heightened" in the short term as markets await next month's release of the Consumer Price Index (CPI), the Merge and the Federal Open Market Committee's next meeting, which now seems likely to produce another 75 basis point interest rate hike. "There's a lot of different data points coming up for the market to consider and that means a little bit more volatility at for the short term," he said.
The Taipei Blockchain Conference's COVID Problem
By Sam Reynolds
Taipei – not Hong Kong, Singapore or Seoul — once played host to the greatest blockchain conference of all time. COVID-19 restrictions in Taiwan in the form of mandatory quarantine and a ban on non-residents from entering might stop the next one from taking place.
In the halcyon pre-COVID days of 2019, the Asia Blockchain Summit was a star-studded event that kicked off with the "Tangle in Taipei," a debate between crotchety no-coiner Nouriel Roubini, a professor at New York University, and former BitMEX CEO Arthur Hayes. Moderated by Andrew Neil, then a prominent broadcaster at the BBC, the exchange was fiery and informative and a complete contrast to dull advertorial panels at conferences of the present tense hosted by venture capitalists pumping their bags. Hayes quotes from the conference ended up in the indictment against him, which is a sure sign of a 10x event.
Fast forward to 2022 and a different team wants to bring blockchain – now "Web3" – back to Taipei in the form of Taipei Blockchain Week. But as the crypto world has changed since 2019, there are now more considerations for international travel and conferences: COVID.
While Taiwan’s neighbors such as Singapore and South Korea are moving past pandemic-induced restrictions, Taiwan, despite its 90% vaccination rate and 50% booster rate, still has mandatory quarantine for all international arrivals (plus mandatory masking outdoors).
The current quarantine regime is three days of self-isolation and then four days of soft quarantine, where you are prohibited from doing anything but the essentials. Seven days after arriving in Taiwan you’re allowed to fully rejoin society, a schedule not exactly conducive for conference goers.
Now there’s talk of the border "opening" to tour groups by October but nothing about a meaningful reduction in quarantine. One local official with Taiwan’s Central Epidemic Command Center is quoted as saying that there were “political considerations” at play. A spike in coronavirus cases caused by a policy of allowing for inbound travel would be a liability for the incumbent party as the nation heads into its version of mid-term elections in November.
'Taiwan Gold Card'
For its part, Taipei Blockchain Week’s organizers seem undeterred.
“Taipei Blockchain Week will happen regardless of the borders reopening! We’re expecting borders to be more relaxed by the end of December,” said organizer Tiffany Lai via Telegram. “As a backup – we’ll be partnering with travel agencies and the government to help process business visas for speakers and attendees.”
One option organizers are exploring is to have attendees apply for a Taiwan Gold Card, a specific type of residency visa that someone can qualify for by demonstrating he or she has over $67,000 in income.
The program was designed to allow for businesses to easily bring in high-caliber foreign talent to help diversify the manufacturing-heavy economy. But it became a favorite for digital nomads looking for an island of normality during the peak of the pandemic in 2020. Since then the program has had trouble retaining individuals who have received these cards, mainly because Taiwan lags behind the rest of the world in re-opening post-coronavirus.
An entry pass for conference attendees wasn’t the intended use case of the Gold Card, but the presence of the Gold Card’s logo on Taiwan Blockchain Week’s website implies a tacit endorsement.
Eth Taipei, part of a network of worldwide Ethereum-focused events, was scheduled for December but canceled and relocated to India due to uncertainty over COVID quarantine rules in Taiwan.
“The travel situation was not clear and we need five months lead time to fundraise and handle logistics so decided to focus on India and swap locations,” its organizer said in a tweet.
Organizers of Taipei Blockchain Week have three and a half months to book speakers, secure visas and convince the world to come to closed-off-masks-on Taiwan for their event. This isn’t an impossible task, but it certainly will be a Herculean effort to pull off.
5 p.m. HKT/SGT(9 a.m. UTC): European Commission business climate/consumer confidence indexes (August)
9 p.m. HKT/SGT(1 p.m. UTC): U.S. housing price index (June/MoM)
10 p.m. HKT/SGT(2 p.m. UTC): Consumer confidence (August)
Bitcoin (BTC) has fallen below $20,000 and is now attempting to claw its way back. Ether and other major altcoins also took a significant weekend hit. GSR over-the-counter trader Luke Farrell provided crypto markets analysis. Also, European crypto advocates are fighting European Union legislation that could restrict U.S. dollar-backed stablecoins. Joining "First Mover" to discuss was Robert Kopitsch, secretary general at Blockchain for Europe.
Crypto Coin AVAX Drops 11% After Self-Described Whistleblower Says Avalanche Weaponized Litigation Against Rivals: Ava Labs CEO rejected the accusation as "conspiracy theory nonsense."
Fintech Firm Lightnet Group Gets $50M From LDA Capital to Boost Velo Protocol's Technology: The firm has the option to raise the total commitment to up to $100 million over the next three years.
Singapore's Central Bank Wants to Foster Digital Assets, Restrict Crypto Speculation: The head of the Monetary Authority of Singapore insists this stance is "synergistic" and says price speculation is the source of the crypto world's problems.
Polkadot Parachain Moonbeam Integrates Cross-Chain Messaging Protocol LayerZero: Developing Web3 interoperability via cross-chain messaging has become a growing trend.
Inflation Hedge or Not, Bitcoin's True Value Is Separation of Money and State: Inflationary forces are still out there and investors are thinking about how best to protect themselves. Is bitcoin a way to do that?
Other voices: Crypto crash: how a teacher’s dream investment turned into a nightmare loss (The Guardian)
Said and heard
"Today, with the FedNow launch date in sight, we are pleased with the collaboration and dedication our pilot participants have brought to advance modern payments in America." (Esther George, president and CEO of the Federal Reserve Bank of Kansas City) ... "The American Data Privacy and Protection Act (ADPPA), a proposed privacy-enhancing bill snaking its way through the U.S. legislative system now, would set strong limits around the type of data that companies can collect about you online. It would be, if passed, the most significant internet law introduced in decades and strongly bolster civil rights." (CoinDesk columnist Daniel Kuhn)
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.