- Apple’s VP of Apple Pay recently told CNN that the company has been keeping an eye on cryptocurrency, saying it has “interesting long-term potential.”
- Bitcoin’s price has risen about 10% since last week, which has analysts predicting the token is entering a bull cycle and will continue to rise.
- With the possibility of a no-deal Brexit looming, the UK’s split from the European Union could very likely cause turmoil in London’s growing crypto market.
- Facebook’s Libra token could be a big boon for stablecoin growth, but analysts worry about the possibility of a payment system gridlock.
A top Apple executive reveals the company thinks crypto has ‘interesting long-term potential’ (AAPL)
Jennifer Bailey, Vice President at Apple Pay, recently told CNN that Apple execs think cryptocurrency is “interesting,” stating, “We think it has interesting long-term potential.” The comments come just weeks after the announcement of the Apple Card, which Apple describes as a credit card that represents the company’s values of simplicity, transparency, and privacy. The card is Apple’s first major consumer finance expansion since Apple Pay launched back in 2014.
While Apple hasn’t formally announced a move into cryptocurrency, an analyst predicted that such a move could serve as a big boost to the crypto industry. That’s not hard to believe given the company’s incredible success manufacturing sleek, aesthetically pleasing hardware and developing a plethora of apps and services. Earlier this year, Apple became the first U.S. company valued at one trillion dollars.
Apple’s potential move into digital coins would serve as “a major shot in the arm for crypto,” Wedbush Securities analyst Dan Ives told CNN Business. He added that the interest in crypto “could make sense given its sights on further monetizing its consumers.”
The introduction of finance products would fall in line with Apple’s continued push into service revenue growth. Its Services business now contributes tomore than one-fifthof the company’s quarterly income, and upcoming offerings like Apple TV+ and Apple Arcade could further boost its earnings.
Bitcoin’s price passed $10,500 this week, marking nearly a 10% increase over last week. This is part of a continuing pattern of optimistic recovery for BTC, which hit a slump last year as part of the 2018 cryptocurrency crash. Analysts predict that the world’s most prominent token is in the start of a bull market cycle, meaning that the currency is expected to continue its 2019 rise.
Notable Twitter crypto experts @filbfilband @PlanBboth supported this conclusion. PlanB supported its prediction with analysis of a 200-week BTC movement chart, tweeting that Bitcoin was “clear for takeoff.” As filbfilb put it, “My overall market assumption is that we are in the early phase of the next Bitcoin cycle.” The 2019 recovery and analyst predictions of continued growth starkly contrast with a number of “crypto is doomed” hot takes published in the wake of the 2018 fumble.
PlanB, the Twitter account well-known for its analysis of Bitcoin’s stock-to-flow ratio, concluded current conditions translated into the beginning of a fresh bull market.
“#bitcoin: clear for take off,” he summarized on Twitter uploading a chart of Bitcoin’s 200-week moving average. That particular metric is significant for PlanB, as lows consistently coincided with the beginning of Bitcoin price ascents to new highs.
Considering the related 20-week moving average meanwhile, popular trader, Filb Filb, arrived at a similar conclusion. “The 20 WMA (also the middle of the weekly Bollinger Bands) has proven to be important in Bitcoin’s cycles; supporting price in a bull market and suppressing price in a bear market,” he explained in his latest newsletter.
The crypto industry has been steadily growing in Europe over the last few years, with the UK capital, London, proving itself to be the epicenter of the explosion. The city has seen a rise in blockchain startups, as well as hosting a number of blockchain-related events such as the Blockchain Summit London, Blockchain Expo, and London Blockchain Week. However, with Brexit looming, the possibility of a no-deal split between the UK and the rest of the European Union could put a damper on London’s burgeoning crypto scene.
New British Prime Minister, Boris Johnson, and his predecessor, Teresa May, have spent two years trying to come to an agreement with the rest of the EU regarding the country’s exit from the union; but so far those efforts haven’t yielded results. A “no-deal Brexit,” as it’s being called, would cut off London’s access to the wider European crypto market.
If the U.K. does eventually leave the E.U. trading bloc without a deal, financial technology companies would lose access to the bloc’s single market–while Bitcoin and cryptocurrency startups may struggle to justify a London office without an easy route into Europe.
“The uncertainty around Brexit has already taken a major toll, particularly for non-U.K. companies doing business in the U.K.,” said Felix Shipkevich, a New York-based lawyer specializing in digital currency and financial technology.
Financial technology businesses have already been found to be moving from the U.K. to the E.U. in preparation for Brexit, according to report from capital markets think tankNew Financial, out earlier this year.
With big tokens like Bitcoin and Ethereum subject to volatile market conditions, stablecoins have emerged as a way to provide cryptocurrency users with more, well, stability while still enjoying the benefits that come with decentralized digital currency. By tying their value to existing financial assets, stablecoins are designed to survive in periods of market uncertainty. The tradeoff is that unlike big coins like BTC, there’s not as much money to be gained. The total value of all stablecoins on the market currently rests below $5 billion.
With Facebook set to launch the Libra, stablecoins “have the potential to grow substantially and ultimately shoulder a significant fraction of global transactional activity.” However, analysts worry that Libra and other stablecoins could be subject to bottlenecks, risking payment system gridlock during high-stress periods. Furthermore, they suggest that Libra investors need to be aware of the potential for negative yields.
Another danger facing Libra, which Facebook plans to launch next year in partnership with a diverse group of corporate and charitable partners, is negative yields, the analysts said.
Libra relies on the income from collateral in the reserve account, which will be fiat currencies including the dollar and euro and government securities, to pay for maintaining the network and rewarding association members. Yet yields on most major currencies are negative yields.
“Any system that relies on reserve-asset income to fund operational and other ongoing costs becomes unstable in a negative yield world,” said the analysts. “With more than half of high-quality short-term sovereign debt already negative, the vast majority of the remainder made up of U.S. government securities, and trends pointing towards global monetary easing, a fully negative yielding Libra reserve has become a plausible (some would argue likely) risk.”
That’s the roundup for September 7th. Check in next week for the latest news of cryptocurrency innovation and regulation around the world!
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