30th January 2024 > > Hester, ETFs, & MiCA.

tl;dr

Hester Pierce and I are great mates. There are signs that the ETF outflows are becoming inflows. MiCA is starting to be implemented, giving the EU a huge head-start in the race for crypto tax dollars, to the temporary relief of several fiscally incontinent governments.

Market Snap

Market Wrap

Markets are anticipating the FOMC meeting this week, during which the Fed will once again display its impotence in controlling inflation driven by global commodity prices. These shortcomings should not distract from the fact that BlackRock clients alone are adding anywhere between two and five times the daily production of BTC to their ETF stash. As the GBTC sellers dwindle daily, the lesson that greater demand and reduced supply for a commodity will always lead to higher prices might be something that the Fed should focus on.

Curious Cryptos’ Commentary – Hester Peirce and spot BTC ETFs

"Too often, in our hyper-regulated world, we forget about what the other side of regulation is, which is, when you come in to regulate to protect someone, you're taking away people's choices," she said, adding that it is "a good thing to let the American people decide whether they want to hold these products in their portfolios or not."

Source: Decrypt.

Hester and I get on so well on so many levels.

Curious Cryptos’ Commentary – The selling has stopped

At least for now.

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

The EU’s flagship crypto legislation is slowly cranking into gear.

ESMA (European Securities and Markets Authority which tends to favour bureaucracy and slow decision making over dynamism and vibrancy) has started a consultation process to create “standards and guidelines” for MiCA:

https://www.esma.europa.eu/sites/default/files/2024-01/ESMA35-1872330276-1619_Consultation_Paper_on_the_draft_guidelines_on_reverse_solicitation_under_MiCA.pdf

Disappointingly, this consultation exercise focuses on the very narrow definition of “reverse solicitation”. It kind of means what it says, but it is an arcane subject of little interest to very few people.

What this consultation paper does highlight is the lack of a definition of crypto assets (see page 20 out of a total of 21. Remember, the CCC research team reads this stuff, so you don’t have to). I think that the definition of cryptos would have been a better starting point for a consultation with industry players, but hey, what do I know?