Russia’s Gazprombank debuts Bitcoin trading in Switzerland
Gazprombank Switzerland, a subsidiary of one of the largest banks in Russia, has piloted its Bitcoin (BTC) transaction service following regulatory approval by Swiss regulators.
According to a Nov. 19 announcement, Gazprombank will provide its new cryptocurrency solution in collaboration with its long-running partners like fintech firm Avaloq and crypto custody provider Metaco.
Gazprombank Switzerland CEO Roman Abdulin said that the new service intends to make crypto transactions “as easy as transactions with traditional assets,” stating:
“Digital assets will become increasingly important for our clients and the global economy. We are pleased to work together with leading Swiss-based entities on the further development of the Swiss and global crypto and blockchain ecosystem.”
In conjunction with debuting its first BTC transactions, Gazprombank Switzerland also announced that the bank has joined OpenVASP, a major industry association focused on regulatory compliance for virtual asset service providers, or VASPs.
Launched in late 2019, OpenVASP intends to help VASPs in complying with the so-called “travel rule” Anti-Money Laundering regulation introduced by the Financial Action Task Force. According to the announcement, Gazprombank Switzerland is the first banking institution to join OpenVASP alongside major industry firms like Swiss crypto exchange Bitcoin Suisse and local crypto bank Sygnum.
The latest news from Gazprombank Switzerland comes shortly after the bank scored approval from the Swiss Financial Market Supervisory Authority to offer crypto custody and trading services to its institutional and corporate clients in late October 2020. Fully owned by Russia-based Gazprombank, Gazprombank Switzerland has been preparing to launch crypto services in Switzerland since at least 2018.
Gazprombank is not the only Russian bank piloting crypto and blockchain-related services abroad. In September 2020, Sberbank — the country’s largest state-run bank — joined a blockchain-based platform for commodity trade finance through its Swiss subsidiary.
- Bitcoin Shortage? Pantera Thinks Market Rally Driven by PayPal Buys
- First Mover: Near Record Highs, Bitcoin May Have a Volatile Week
- 22 | November | 2020
- US dollar squeeze and $19K BTC: 5 Things to watch in Bitcoin this week
- Bitcoin, Ethereum, Ripple’s XRP, Litecoin, And Chainlink Could Be Heading Into Their Biggest Week Ever
Bitcoin Shortage? Pantera Thinks Market Rally Driven by PayPal Buys
PayPal’s recent leap into the crypto market is helping to drive the current bitcoin (BTC) rally, according to Pantera, a prominent cryptocurrency and blockchain investment firm.
In an investor letter published Nov. 20, the venture firm compared the ongoing bull market to the last time BTC rose above $18,000, three years ago.
“Previously the friction to buy bitcoin was pretty onerous,” the letter notes, contrasting that difficulty with how e-commerce giant PayPal has now made it easy for millions of users to become potential bitcoin, ether, bitcoin cash and litecoin buyers.
Indeed, all eligible PayPal account holders in the U.S. can now buy, hold and sell those cryptocurrencies – sooner than the payments firm anticipated, due to steep customer interest. Additionally, the firm recently upped its weekly crypto purchase limits to $20,000 from an initial $10,000.
“BOOM! The results are already apparent,” Dan Pantera, chief executive and founder of the eponymous fund, wrote in the November letter. “When PayPal went live, volume started exploding.”
Panterra claims that PayPal is already buying almost 70% of the new supply of bitcoins. Together with Square’s Cash App routine bitcoin buying, more than 100% of all newly minted bitcoins is accounted for, Panterra alleges.
The Bitcoin network issues new BTC on a fixed and predetermined schedule. Only 6.25 new BTCs are mined every 10 minutes, following this year’s “halving,” an amount that will continue to decrease every four years until all 21 million BTC enter circulation.
Panterra’s thesis centers around a supply-side understanding of the bitcoin market. The idea is that as the supply of BTC decreases, due to lower mining rewards, the demand naturally increases – leading to an appreciation in price.
“When other, larger financial institutions follow [PayPal’s] lead, the supply scarcity will become even more imbalanced. The only way supply and demand equilibrates is at a higher price,” Panterra wrote.
First Mover: Near Record Highs, Bitcoin May Have a Volatile Week
Bitcoin is trading above $18,500, having charted a minor pullback to $17,800 over the weekend. The cryptocurrency’s one-month implied volatility metric has jumped to four-month highs, suggesting increased expectations for price turbulence over the next four weeks.
“It’s likely the week ahead is filled with volatility with the possibility of a trading range between $19,000 and $17,000 the likely outcome. However, if the bulls take charge, then we could be discussing new all-time highs for BTC,” noted crypto exchange EQUOS in its daily bitcoin analysis email.
In traditional markets, safe havens such as the U.S. dollar and gold are trading heavily alongside stock market gains. Risk appetite has been boosted by more positive news on the coronavirus vaccine front, this time from AstraZeneca and Moncef Slaoui, head of the U.S. government’s Operation Warp Speed. “Vaccinations against COVID-19 will ‘hopefully’ start in less than three weeks,” Slaoui said on Sunday.
That said, when it comes to bitcoin this year, some of the biggest names in global finance were WRONG and LOSERS, as (lame duck?) U.S. President Donald Trump might put it.
JPMorgan CEO Jamie Dimon, Berkshire Hathaway CEO Warren Buffett, Bridgewater Associates CEO Ray Dalio, Goldman Sachs. All of these Wall Street titans steered investors away from the largest cryptocurrency this year as its price soared more than 150%.
Even if bitcoin’s price once again plunged 39%, as it did in March when the deep economic toll of the coronavirus became clear to global investors (before the Federal Reserve bailed out financial markets), the price would still be roughly $11,370, up some 59% from the Dec. 31, 2019, price of $7,168. For comparison, the Standard & Poor’s 500 is up 11% this year and gold has gained 24%.
Few of the biggest banks and brokerage firms even had bitcoin on their radar at the start of this calamitous year. Some investors came around to the concept sooner than others.
In just 11 years, bitcoin has gone from nothing to an awe-inspiring creator of wealth. At this point, whether prices go to the moon or stagnate or correct, the cryptocurrency is becoming impossible to ignore in an increasingly dysfunctional global financial and monetary system.
There seems to be no stopping the bitcoin freight train.
The cryptocurrency jumped over 15% in the seven days leading up to Nov. 22 to register its biggest weekly gain since October 2019. That was also the seventh straight weekly rise.
What’s more, prices ended last week (Sunday, UTC) above $18,400 – the second-highest weekly close on record. Bitcoin is now just 6.5% short of challenging the record high of $19,783 reached in December 2017.
A move to record highs could easily happen in a matter of a few hours, given the recent strong momentum.
That said, a metric from bitcoin’s perpetual futures market now suggests the market is getting excessively skewed to the bullish side and could experience a rise in volatility.
The average level of the “funding rate” across major exchanges has risen sharply from 0.023% to a five-month high of 0.087% in the past 48 hours, according to data source Glassnode.
So far, pullbacks have been shallow and restricted near the ascending 10-day simple moving average (SMA), currently at $17,640. As such, the SMA line is a key support to watch out for in the short-term. Bitcoin has immediate resistance at $19,000, followed by the record high of $19,783.
Risk appetite in currency markets was boosted by progress towards a COVID-19 vaccine rollout even as PMI data showed a sharp contraction in euro zone business activity as a result of lockdown restrictions.
As bitcoin gets closer to its record high of almost $20,000, CNBC asked five crypto experts for their take on the rally.
Expectation for Fed action “is keeping bonds from selling off.”
“Quarterly baskets of the 10 (plus) most owned stocks by mutual funds and hedge funds outperformed the S&P 500 six and 12 months later,” Citigroup equity strategists said.
The day after the election was one of the worst ever for bank stocks; three trading sessions later, they had one of their best days.
22 | November | 2020
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Author: by adminbtc
US dollar squeeze and $19K BTC: 5 Things to watch in Bitcoin this week
Bitcoin (BTC) starts another week at near historic highs as the U.S. dollar continues to drop — what’s next?
With investors seeking safe havens and Bitcoin already seeing a demand squeeze, Cointelegraph covers the factors that could further shape price action this week.
News from the U.S. that mass vaccination against the Coronavirus may begin within a month has sent investors panicking for hedge assets.
With multiple candidates now available among potential vaccines, the mood is tending towards worldwide recovery emerging, which means the dollar becomes less appealing compared to other destinations.
“The vaccine news is favoring the view of a sooner-rather-than-later global economic recovery with the USD losing its safe haven appeal along the way,” Rodrigo Catril, a currency strategist at National Australia Bank, told Bloomberg.
“This is a risk-positive, USD-negative backdrop, especially with the Fed likely to remain ultra-dovish for some time.”
The U.S. dollar currency index (DXY), which tracks USD against a basket of twenty trading partner currencies, has fallen lows seen twice since August, with monthly losses totalling nearly 2.2%.
As Cointelegraph often reports, DXY tends to show an inverse correlation to Bitcoin, meaning protracted weakness comes in tandem with stronger BTC/USD performance.
The outlook for the dollar remains uncertain thanks also to the risk of fresh sanctions by the White House on Chinese tech firms, details of which are expected this week.
Within Bitcoin, the emerging narrative that buyers are simply demanding more coins than can be produced continues.
As noted previously, this is being driven by corporate entities, notably Grayscale, Square’s Cash App and PayPal, with the requirements of all three only rising with time as more clients choose to buy BTC.
The result is that miners see their block subsidies snapped up, and the only way for the buy side to plug the gap is to pay higher prices per coin.
“PayPal and Cash App are already buying more than 100% of all newly-issued bitcoins,” investment firm Pantera Capital summarized in a blog post on Nov. 21.
“Where would Cash App get their coins? That’s where the finite-supply, inelasticity part comes in: At a higher price. That is THE story in Bitcoin right now.”
Pantera included a chart of volume from ItBit, the exchange run by Paxos, the payment handler covering PayPal’s new cryptocurrency feature. PayPal alone, it added, appears already to be buying 70% of all newly-mined bitcoins.
The new status quo differs markedly from the last time that Bitcoin traded at levels near $20,000. Unlike then, various figures argue, those buying this time are by definition in it for the long run.
“At $18.5K #Bitcoin Google searches for ‘bitcoin’ have not seen an uptick. This is not a FOMO rally. It’s steady hands. Few understand this,” Gemini exchange co-founder Cameron Winklevoss tweeted on Monday.
Last week, comments from one traditional market strategist underlined the seeming lack of interest in Bitcoin from mainstream consumers. This, she told Bloomberg, had died in 2017.
After its 4.82% increase last week, Bitcoin’s network difficulty is set to lead a resurgence in fundamentals in five days’ time.
Difficulty and its automatic readjustments — after every 2016 blocks — are an essential feature in Bitcoin allowing it to maintain constant block mining intervals without outside intervention and, thus, ensuring network stability.
At the beginning of November, difficulty dropped by the most in nine years in a single readjustment. This created a more accessible playing field for miners, with the expectation that increased activity would make difficulty rise again thanks to the ensuing competition.
As such, at the end of this week, difficulty should bounce upwards by an estimated 7.7%, almost reversing the impact of the previous dip and opening the path to new all-time highs.
Likewise, Bitcoin’s average hash rate — the estimated computing power dedicated to validating transactions — has hit 137 exahashes per second (EH/s), rebounding 30% since the difficulty drop.
Seven-day average hash rate’s all-time high currently lies at 146 EH/s, this appearing in mid October.
Zooming out — even slightly — is still a cause for major bullishness among some of Bitcoin’s best-known analysts.
For PlanB, creator of the stock-to-flow-based series of price forecasting models, the real upside for Bitcoin is still yet to come, despite monthly gains already totalling 43%.
This is due to historical behavior after block subsidy halving events. In 2012 and 2016, upside ensued months after the halving, but serious gains came the following year — and looked more like a tsunami than a slowly increasing tide.
“Current #bitcoin price action is nice, but we are waiting for a real jump (like the red arrows early 2013 and 2017),” he tweeted alongside an annotated chart.
“IMO that will be the start of the real bull market, and indeed phase5. January 2021?”
As Cointelegraph reported, PlanB is far from alone in considering next year to be the return of Bitcoin’s halcyon days.
A concerning counterargument to further gains for Bitcoin last week came in the form of worrying readings from the Crypto Fear & Greed Index.
Using a basket of factors to measure investor sentiment, the Index almost matched highs from 2019, which culminated in a significant price drop.
As of Monday, however, the metric’s current “extreme greed” rating of market sentiment is slowly beginning to ease off, dropping from 94/100 to 90/100.
“Extreme greed” refers to the rapidly deteriorating strength of investor resolve as prices increase, signalling the increasing likelihood of a sell-off.
Bitcoin has sent the cryptocurrency market soaring in recent weeks with the total value of the world’s combined cryptocurrencies adding an eye-watering $150 billion since the beginning of November.
The bitcoin price brushed $18,900 per bitcoin this week, coming within touching distance of its 2017 all-time high and helping other top five cryptocurrencies—ethereum, Ripple’s XRP, litecoin and chainlink—record massive gains. XRP has climbed over 70% this week alone, with ethereum, litecoin and chainlink all up between 22% and 36%.
Now, as traders debate exactly how far this bull market has to run, the bitcoin and cryptocurrency community are gearing up for a pre-Thanksgiving surge—and may get a boost from the U.S. Federal Reserve and the European Central Bank (ECB).
MORE FROM FORBESIs Bitcoin About To Become A $1 Trillion Asset?By Billy Bambrough
The bitcoin price has more than doubled this year, helping other major cryptocurrencies ethereum, … [+] Ripple’s XRP, litecoin and chainlink find fresh support.
Bitcoin’s 2020 bull run is so far thought to be more institutionally-driven than its 2017 retail boom, when global bitcoin mania pushed the bitcoin price to all-time highs of around $20,000 only for it to crash back to around $3,000 in 2018. But that retail demand could be just around the corner.
Even as the coronavirus pandemic prevents families from gathering to the same extent as they did pre-Covid-19, historical data suggests big U.S. holidays—and Thanksgiving in particular—usually send the bitcoin price sharply higher.
“Nothing like a pre-Thanksgiving bitcoin run,” Catherine Coley, the chief executive of Binance.US, a San Francisco-based bitcoin and cryptocurrency exchange launched by Caymen Islands-based Binance last year, said via email.
“This year has been extremely unpredictable but bitcoin held on to its value through most of the year and the recent bullish momentum proves to many bitcoiners what we already knew: a global digital asset untethered to local fundamentals has extreme potential for global growth and adoption, especially in a time where nations are printing more of their currency to revive economic activity.”
Bitcoin has developed its reputation as digital gold this year, finding support from Wall Street and some big-name investors as central banks rev up their money printers in response to the coronavirus pandemic and lockdowns put in place to contain it.
This week, investors in the U.S. and Europe will get a clearer picture of how seriously the U.S. Fed and the ECB are considering providing further stimulus in response to surging coronavirus cases around the world.
On Wednesday, the Fed will publish the minutes from this month’s monetary policy meeting where chairman Jay Powell said tweaks to the asset purchase programme to provide additional stimulus were discussed. Then on Thursday, the ECB publishes its October meeting minutes where investors will be looking for any further insight into the ECB’s options after it said it planned to “recalibrate its instruments.”
Equity markets, as well as bitcoin and cryptocurrency prices, have been propped up by global stimulus measures this year with investors cheering the seemingly limitless funds being deployed.
MORE FROM FORBESWhy Joe Biden Could Be Big For BitcoinBy Billy Bambrough
The bitcoin price has added over 150% over the last 12 months with many bitcoin and cryptocurrency … [+] bulls prediting it will climb yet higher.
Elsewhere, the bitcoin and cryptocurrency market was last month set alight by the news payments giant PayPal would roll out bitcoin buying and spending services to its near-350 million users—giving many bitcoin developers and supporters long-sought validation.
“For 10 years, arguments against bitcoin have been the same and yet bitcoin has continued to grow its user base, infrastructure and value, despite the naysayers,” Danny Scott, the chief executive of Isle of Man-based bitcoin and cryptocurrency exchange CoinCorner, said via email in response to legendary investor Ray Dalio’s recent Twitter thread on his “problems with bitcoin.”
“I feel that we’re almost at the point where the requirement for proof is on the sceptics as to why bitcoin won’t work rather than throw empty, uneducated arguments out,” Scott said, adding: “Bitcoin has been the best performing asset this year, not to mention the best performing asset of the last decade—stats speak louder than words here.”
Author: Billy Bambrough