Thursday Thoughts: GameStop and Bitcoin

Good morning. Bitcoin just rebounded from $30,000 but it looks like the bloodbath is not yet over.

Welcome to Thursday Thoughts, part of our new series: BitPinas Daily. We will look at the price of Bitcoin, Ethereum and the major cryptocurrencies. Crypto is global, but sometimes news that matters happens while we sleep. So we bring to you what’s happening in our space here and abroad.  

Market Price as of January 28, 2021:

Bitcoin closed January 27, 2021, at $30,407 per BTC. We’re down 15% in the last 7 days and up 4% since the year began. This is 27% below the previous all-time high of $41,940, which was hit on Jan. 8, 2021.

Bitcoin’s market capitalization stands today at $566,598,592,486 which is 61% of the entire cryptocurrency market. The entire crypto market, by the way, now has a market cap of $917,095,316,967 (-6.10%).

On the table above, there’s the cryptocurrency SLP. If you wonder what that is, check out this article: Playing Axie Infinity vs Minimum Basic Salary in the Philippines.

Social Network

Reddit partners with the Ethereum Foundation

Reddit has been experimenting with ETH-based tokens to be given as rewards on two subreddits, r/Cryptocurrency and r/FortniteBR. Think of it like Community Points. In a recent post written by one of its admins, the partnership with the foundation is a testament to Reddit’s commitment to blockchain, a technology that “brings value and independence” Reddit communities and millions of redditors. 

CBDC 

Central banks likely to issue CBDCs in three years: BIS

To recap, CBDCs or central bank digital currencies are electronic money that is backed directly by central bank reserves as opposed to the digital money on mobile bank account, which are backed by a user’s deposits in their bank.

According to the Bank of International Settlements (BIS), which is the central bank of all central banks, CBDCs are entering “advanced stages” with nations looking to capitalize on blockchain technology. With 86% of global central banks actively exploring CBDCs, BIS thinks that central banks representing fifth of the world’s population are set to introduce a “general purpose CBDC in the next three years.”

Gamestop

Gamestop investing craze is ‘proof of concept’ for Bitcoin’s success, says Scaramucci

Some introductions: Anthony Scaramucci previously served as White House Director of Communications during Trump’s administration and is the founder of SkyBridge Capital, a global alternative investment firm. He has since launched a new Bitcoin fund, joining other institutions that have done so.

If you are into video games, you know of GameStop. The pandemic has almost killed it, and Wall Street firms have put a huge short on it. Essentially they are betting that the price of Gamestop stock (GME) (which at some point in the past was $4) will go lower. As with any shorting, they will make money if the stock price does fall and will lose money and possibly get liquidated if the price goes high. 

And the stock price did increase, thanks to the effort of long retail traders communicating through Reddit and even on Discord. The current stock price is $346. Elon Musk tweeted “Game Stonks.” It’s game over for the Wall Street firms, one of them — Melvin Capital — got wiped out. (They did not go out of business but took a huge loss). (Here’s a good explanation of the story.)

By the way, an explanation of short selling:

What’s this all got to do with Bitcoin? According to Scaramucci, the event exemplifies financial decentralization. “The activity in GameStop is more proof of concept that Bitcoin is going to work,” Scaramucci said in an interview. “How are you going to beat that decentralized crowd? That to me is more affirmation about decentralized finance.”

Just search “Gamestop Bitcoin” on Twitter to check the conversation around it. 

#CryptoPH

Philippines has the highest ownership of cryptocurrency

Yesterday, we published “Philippines has High Crypto Adoption, Mature Ecosystem, Says Messari Report” which summarizes the research done by Mira Christanto of Messari.io. Some insights:

• Use of crypto for financial inclusion
• Filipinos have the highest ownership of cryptocurrency
• Regulators have adopted a developmental mindset towards crypto
• 80% of PDAX’s volume is from institutions that facilitate remittances like MoneyGram
• Coins.ph has the highest brand recall for crypto purchases

Check out the article here. 

What else is happening

• Blockstream buys $25 million worth of bitcoin mining hardware from MicroBT
• What DeFi Has in Common With Cubism
• DoJ, Chainalysis work to break up ransomware network that targets hospitals
• Bitcoin’s Price Rebounds After 30% Drop From All-Time High

This article is published on BitPinas: Thursday Thoughts: GameStop and Bitcoin