18th May 2022 > > The Terra fallout begins.

tl;dr

A digital Euro is years away, thankfully.

Market Snap (at time of writing)

Market Wrap

BTC is oscillating around the $30k mark but note that move in the perpetual futures funding rates. Shorts are at risk of a painful squeeze higher. And don’t we all just love a short squeeze.

Occasional Series – Technical Analysis (*)

It has been a while since I last enjoyed having a dig at the techies, so I hope this one is taken in good humour.

Here is the current (as of Tuesday afternoon) 15 min candlestick for LUNA. I am sure techies can draw all sorts of pretty price patterns on this one apart from what is shown already:

That’s a screen shot from Binance.

Now let’s look at the 1 hour candlestick for LUNA from Binance, screenshot just one minute later:

Where are the squiggles on that graph going to go?

Occasional Series – Decentralisation

The largest and most enduring example throughout the whole history of mankind that we have of the benefits of decentralisation versus centralisation is market forces.

I suspect that comment will ruffle a few feathers.

Shall we have a debate?

Curious Cryptos’ Commentary – Here comes the fallout from Terra

Politicians just cannot keep their controlling instincts suppressed for long.

On the 3rd May 2022, the CCC reported Fabio Panetta, an executive member of the ECB, as stating:

“We need globally coordinated regulatory action …”

Regular readers know that this is simply the most terrible idea ever to come out of the ECB, and there is a lot of competition for that crown.

Panetta has been at it again. Unable to hide his glee at the Terra fiasco, his rather predictable view is this:

“Recent developments in the market for crypto-assets illustrate that it is an illusion to believe that private instruments can act as money when they cannot be converted at par into public money at all times.

“Despite claims that cryptos are a trustworthy form of “currency free from public control”, they are too risky to act as a reliable means of payment. They behave more like speculative assets and raise multiple public policy and financial stability concerns.”

That’s an interesting concept - “convert at par into public money”.

Sounds to me like a call to arms to return to the gold standard. For all fiat currencies. One cannot imagine the financial turmoil that would unleash on the world, if it were at all possible (as an aside, this is one of the many reasons cryptos will not be a replacement for fiat, but complementary to fiat).

And of course, his main conclusion is even more predictable – that recent events justify the introduction of a digital euro in the form of a CBDC (Central Bank Digital Currency).

…

There is light at the end of this tunnel. Or rather, at the beginning of it.

Panetta has put a timescale of 3 years from the start of development and testing of a CBDC Euro to its introduction. Afflicted with an obvious lack of sense of urgency – a trait common in his chosen profession – development won’t even start until 2023. And I suspect his 3 year timescale will get lengthened somewhat, as the budget for the work balloons too.

Just for once, the inertia of government bureaucracy is working in our favour.

…

(*) You will notice that these graphs are snapped at arbitrary times with arbitrary timescales.

But that is exactly how technical analysis works. Smoke and mirrors my friends, smoke and mirrors.