11th July 2023 > > MiCA.

tl;dr

Implementation of MiCA has begun, but it might not be as smooth a process as it could be. Standard Chartered offers some heart-warming predictions.

Market Snap

Market Wrap

The price of BTC briefly touched $31k overnight only to drop back $800 over the next two hours. The leveraged children will be looking to capitalise on any move above $31k or lower than $30k in the belief that a new trading range will then become established. Me, I will just buy whichever direction we take.

Curious Cryptos’ Commentary – MiCA (Markets in Crypto Assets)

Never underestimate the bureaucratic desire, talent, and innate need for messing stuff up.

The CCC has often written in glowing terms about the EU’s flagship crypto legislation, and rightly so. Consultations are now underway to determine specific rules and regulations for full implementation in 2024. A decently written deep dive can be found here:

https://paddihansen.substack.com/p/the-eus-mica-framework

However, now I notice one restriction that has passed me by – a daily cap of 200mm EUR on transaction volumes for stablecoins.

The motivation for this cap is obvious – it is driven by a desire to force adoption of an EUR CBDC rather than USD-denominated stablecoins (especially In the context that the US is fighting the good fight against CBDCs).

It is this kind of short-term thinking that makes me despair of our bureaucratic and technocratic elite.

…

I am at a loss to understand how this restriction on the daily volume of stablecoins would be enforced.

I guess there could be an extremely inefficient, administrative body packed full of highly paid (and unsackable) executives with tax free pensions after day one of employment, set up to monitor all off-chain activity of stablecoins conducted through centralised crypto-currency exchanges.

It would cost a shed load, whilst creating a bunch of non-jobs. But hey, it’s only taxpayers’ money, so who cares?

…

Meanwhile, ESMA (EU Securities Markets Regulator) is getting on with the day job:

Curious Cryptos’ Commentary – Standard Chartered

That’s enough whingeing and griping for the day, let’s cheer ourselves up with a price prediction.

Standard Chartered have highlighted two factors they rate as important – miner supply and the halving. We already know that the halving is overhyped (https://www.curiouscryptos.com/post/9th-july-2023-the-halving) though the CCC’s prediction that it will increasingly gain media coverage is already in play.

As for miner supply, Geoff Kendrick wrote:

“Increased miner profitability per BTC mined means they can sell less while maintaining cash inflows, reducing net BTC supply and pushing BTC prices higher."

“At recent prices, they (miners) have been selling 100% of new BTC; at USD 50,000 we think they would sell 20-30%."

Which explains why the halving is overhyped – if miners are selling less than 50% of new daily supply, the halving becomes irrelevant.

…

In conclusion Geoff has a 2023 year-end target of $50k and $120k for the end of 2024.

If this were to be true, those leveraged plays on BTC through holding shares in MSTR (MicroStrategy), RIOT (Riot Blockchain), ARB (Argo Blockchain), and COIN (Coinbase), should result in some hefty capital gains tax bills.