24th February 2023 > > Custody and bans.

tl;dr

Two very exciting developments that we hope signpost the way forward for cryptos in 2023.

Market Snap

Market Wrap

Today is options’ expiry day. Analysis suggests that any close above $23k is good for call buyers in the round. This might explain the weakness for the last two days, as hedges are placed to protect some of the theoretical profits from the surge in price a week ago.

Curious Cryptos’ Commentary – Here’s a ban I approve of

Tom Emmer, Republican Congressman, announced Wednesday on Twitter:

“Today, I introduced the CBDC Anti-Surveillance State Act to halt efforts of unelected bureaucrats in Washington, DC from stripping Americans of their right to financial privacy.”

He explains:

“The bill does three things:

1. Prohibits the Fed from issuing a CBDC directly to anyone.

2. Bars the Fed from using a CBDC to implement monetary policy and control the economy.

3. Requires the Fed's CBDC projects to be transparent to Congress and the American people.

Any digital version of the dollar must uphold our American values of privacy, individual sovereignty, and free market competitiveness. Anything less opens the door to the development of a dangerous surveillance tool.”

Go Tom!

Curious Cryptos’ Commentary – Custody

A subject close to the hearts of all crypto enthusiasts, custodial solutions that do not rely upon either private organisations like Binance, or that do not rely upon self-custody like a Ledger Nano X, are a prerequisite for the wholesale adoption of cryptos. Assuming the latter is what we all wish to see, any progress on this front is very encouraging indeed.

DZ Bank, with EUR 630 billion of assets, has announced it will start to offer custody services for cryptos to its institutional clients through a partnership with Metaco:

https://www.prnewswire.com/news-releases/dz-bank-selects-metaco-harmonize-to-underpin-its-institutional-digital-asset-custody-offering-301751883.html

Established TradFi banks like DZ, who have a much greater retail recognition on the other side of Europe, are very clear in their view about the need to segregate and provide secure custody for their clients’ assets. This partnership would not have been lightly undertaken.

There are two points we can take from this announcement.

The first is obvious – that institutional clients now have a new secure custodial solution provided by a very trusted and established partner.

The second is better still – that institutional clients are demanding such a service as they develop and grow their crypto business, for DZ Bank would not do this otherwise.