Dispatch #15: $20,000, You’ve Made Our 2020

In this patch of your weekly Dispatch:

• Bitcoin breaks through the all-important $20K psychological barrier
• CME unveils ETH futures, making it easier for traditional actors to access the space
• Pornhub now accepts 15+ cryptos following damning NYT report

The Big Idea

Bitcoin Hits $20,000

This one’s for the history books. That all-important psychological mark, finally hit. While we technically achieved new all-time highs over the last few weeks, $20,000 was what everyone was hankering for.

The milestone couldn’t have been achieved at a more reflective time. Hours earlier, a UK firm with more than $20B in assets under management confirmed that its previously reported $15M purchase of Bitcoin was actually a purchase worth closer to $744M. This was a fitting capstone to a year that has seen the relentless growth of institutional investors in the space.

What’s more, the announcement happened the same day that the US Federal Reserve met to discuss not only the continuation of zero interest rate policy but to even examine the possibility of a new wave of asset purchases.

No one can any longer critique Bitcoin for failing to return to that key $20,000 marker despite such a primed macro backdrop.

Bitcoin has climbed the pantheon and secured its place as one of today’s most essential macro assets.

The Latest In…

Ethereum

While institutional interest in Bitcoin has been the big headline news, many of those same institutions are also looking at Ethereum. Those interested parties have a new resource – derivatives marketplace CME announced ETH Futures, which are slated to launch early next year. These instruments make it significantly easier for traditional actors to get exposure to the space. The announcement was designed to correspond to the three-year anniversary of the CME announcing Bitcoin futures in December 2017.

The Latest In…

Traditional Markets

We’ve spent a lot of time recently looking at brewing regulatory action around crypto but some other areas of fintech are in hot water as well. Robinhood is facing serious legal action around what some regulators consider aggressive marketing techniques to attract unsophisticated (and young) retail investors.

The Latest In…

DeFi

DeFi has been comparatively quiet the past few weeks, but a couple stories are of note. First, the founder of Nexus Mutual experienced a relatively severe attack, and has been trying to get his assets back. On a happier note, decentralized exchange Bonafida announced $4.5M in seed financing.

The Latest In…

Censorship Resistance

Last week, the New York Times came out with a damning story around exploitative and illegal videos on Pornhub. While the site tried to make some changes, Visa, Mastercard, and Discover all severed ties, leaving the company with only crypto as a payment option. Since then, it has bulked up to accept more than 15 different cryptocurrencies as payment. The story puts crypto back at the center of the discussion of freedom, platform censorship, and payments.

Is Pornhub inadvertently becoming a crypto hero?

The Week’s Most Interesting Data Story

How Ethereum Has Changed

With $20,000 BTC breached, there is a natural tendency to compare this bull run to its 2017 forebear. We’ve discussed how Bitcoin is being driven up by a new group of buyers, but how has Ethereum changed? By pretty much every metric you can imagine, ETH has matured, grown stronger, and solidified itself. Check out for example the 900% growth in unique addresses and monthly active developers. Just imagine what this will look like in another three years…

Hot Topics

What the Community Is Discussing

This really sums up the absolute insanity of this week. Keep in mind this was just in one day.

Given how much Bitcoin’s price rally has been driven by institutional investors reacting to changes in Fed policy, this little refresher course from Travis Kling is worth a review.

As crypto takes more of the center stage, this look at regulations and DeFi feels highly relevant.

Our Take

@AntoniNexo This Week

• Antoni, who does not see anything stopping BTC’s rise higher and higher, told The Telegraph and Bloomberg: “We have a new line in the sand and the focus shifts to the next round number of $30,000.” This “is the start of a new chapter for Bitcoin. It’s a narrative the media and retail crowd can properly latch onto because they’ve been noticeably absent from this rally.”
• He also commented on the macro significance of this milestone, saying that “Bitcoin smashing through $20,000 is a testament that the COVID crisis is powerful enough to shift the incumbent monetary order. The new all-time high is the palpable evidence of an ongoing major social conversion – a metamorphosis from a dollar-dominated economy to blockchain-based, deflationary, and limitless finance.” Hello, brave new world.

What to Watch for Next Week:

• Will Bitcoin stay above $20,000?
• Will Ethereum interest grow in the wake of new institutional products?
• Will we see another DeFi merger?