Fear and Greed: Bulls watch Fidelity’s retail crypto shift; bears in the White House with Bitcoin mining concerns
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It’s a volatile week so far in crypto (when isn’t it?) and the bulls and bears must have some pretty big callouses from their endless, exhausting tug-of-war.
In terms of news-based machinations, though, on one side we have Fidelity, State Street and David Rubenstein pulling hardest for Team Bulls. And on the other, a few Negative Nellie White House officials and Ethereum investment product outflows.
Not to mention some bastard by the name of Macro. So we won’t mention it.
Before we round up some of the more significant headlines, a quick look at the market’s leading sentiment indicator – the crypto Fear & Greed Index.
On the surface, “Fear” in the market would suggest the bearish POV is the winning lens. A closer look, though, and it suggests a fair bit more positivity has crept in over the past 24 hours.
Onto some of the more eye-catching recent news…
Fidelity, the US$4.2 trillion global asset-management firm, has been tooling around on the sidelines of the crypto industry swimming pool for a while now. Dipping its toe in here and there – for instance in the 401(k) US retirement-savings lane.
There have been rumblings in the past about the investment giant potentially setting up a crypto-trading platform for its institutional clients, and those noises appear to be picking up in volume again.
According to a Bloomberg report, the CEO of Galaxy Digital, Mike “Howlin’ Wolf” Novogratz believes Fidelity is working on offering crypto-trading services to its more than 34 million retail investor base. So not just its special fat-cat clients, then, which seems inclusive.
While Fidelity hasn’t confirmed the move, this is what Novogratz reportedly said to a New York conference yesterday:
“A bird told me that Fidelity, a little bird in my ear, is going to shift their retail customers into crypto soon enough. I hope that bird is right. So we are still [on] this institutional march and that gives crypto its floor.”
One thing, Novo might want to get that ear checked out. Sounds peckin’ painful.
• State Street, another American investment-management big dog, spoke to The Sydney Morning Herald the other day and expressed belief that institutional interest in crypto is growing and that “the asset class is here to stay”.
Irfan Ahmad, State Street Digital’s product lead for the Asia-Pacific region said that the financial giant’s clients “weren’t really deterred from making strategic bets on the asset class”.
Ahmad noted that various investment titans that are already offering crypto products, are likely to make further moves into the space. In April, for instance, Goldman Sachs launched a Bitcoin-backed loan and more recently, BlackRock aped in with a BTC private trust.
• Canada’s Conservative Party has elected “Bitcoiner” Pierre Poilievre, an MP for Ontario, to lead its party and challenge Prime Minister Justin Trudeau’s Liberal Party at the country’s 2025 election.
Actually, is this bullish? Maybe it depends what side of the political fence you lean on. As decentralised and free from government control as a crypto can possibly be, if Bitcoin could actually think, it’d probably care less about this news, come to think of it.
• David Rubenstein, the founder of another ridiculously deep-pocketed American investment firm, Carlyle Group, is a former blockchain and crypto sceptic, but appears to have changed his tune, proving that not all old American billionaires are like the two antagonistic muppets in the film Trading Places.
(Or indeed the two antagonistic Muppets Statler and Waldorf. Or, also indeed, Warren Buffett and Charlie Munger.)
Rubenstein reportedly recently told CNBC’s Squawkbox the following:
“I have not bought cryptocurrencies, but I have bought companies that service the industry because I think the genie is out of the bottle.”
He then added: “Some of the blockchain related investments and things associated with crypto are likely to be with us for some time… Young people tend to have the intelligence and energy to kind of get trends started.”
• Ford, an automotive company you might’ve heard of, has reportedly filed 19 trademark applications related to possible metaverse activities.
The applications make note of Ford-branded NFTs, its own NFT marketplace, and virtual models of cars including Mustangs and the Ford Bronco.
Trusty, all-American trademark lawyer Mike Kondoudis has the tweet. In fact, he’s been reporting a lot of big-brand metaversal moves all year.
🚨🚨FORD is making a big move into the Metaverse!
The company has filed 19 trademark applications for all of its major brands claiming plans for:
▶️ Virtual cars, trucks, vans, and clothing
▶️ Online stores for NFTs#NFT #Metaverse #Web3 #NFTs #Ford #Mustang #F150 #Fordtrucks pic.twitter.com/2JK2Nf9jO7
— Mike Kondoudis (@KondoudisLaw) September 7, 2022
We could go on and on with the crypto-positive news we’re seeing in our Twitter and news feeds, but we’d best cap it there and see what the bears are bringing to the picnic…
The White House’s OSTP (Office for Science and Technology Policy) late last week released its highly anticipated 45-page report on climate and energy implications of the crypto industry. And on the surface, it doesn’t sound particularly positive.
In fact, many of the initial reported headlines have been pretty alarmist, highlighting the recommendation from the OSTP that the US government might want to consider banning the use of the energy-sapping Proof-of-Work consensus mechanism. The one that Bitcoin, and Bitcoin miners need in order to function.
The report suggests that federal government action is required to ensure the broad adoption and responsible development of digital assets.
“Crypto-assets could hinder broader efforts to achieve net-zero carbon pollution consistent with U.S. climate commitments and goals,” wrote the OSTP.
That said, based on a deeper dive into the report, which also indicated the potential for crypto mining to help capture vented methane, not everyone is down with the idea the report is actually all that negative…
Joe Carlassare, who co-chairs the Cryptocurrency, Blockchain and FinTech group at law firm SmithAmundsen, for example…
Every major Bitcoin influencer going on national TV should be hammering the point that the White House report found that PoW mining could yield positive results for climate change.
— Joe Carlasare (@JoeCarlasare) September 8, 2022
• Outflows in Ethereum-based investment products have been increasing just lately, according to industry fund manager CoinShares.
Its latest weekly report suggests that ETH investment products made up most of the total outflows across the week of September 5-11. It’s the fifth straight week of outflows.
Outflows in the context of the CoinShares report, by the way, could be seen as bearish, indicating investors are moving out of a specific crypto (in this case Ethereum) and into other assets.
This is not to be confused, then, with the less specific idea of crypto outflows leaving exchanges for hardware wallet storage, which would be something for the bullish list above.
The report’s author, James Butterfill wrote that the outflows have come “despite the improved certainty of the Merge… and perhaps highlights a concern amongst investors that the “event might not go as planned.”
Cointelegraph headlined its article on the report like this: Merge ‘jitters’ sees outflow from Ether-based investment products.