3iQ Research Group consolidates the top five cryptoasset stories of interest to investment advisors and our investors.
Bank of Canada’s Digital Currency is ‘Contingency Planning’ for Future Digital Currency Growth
November 15 – According to a senior official at the Bank of Canada, the central bank is mulling the launch of its own digital currency once other private digital currencies begin to gain traction in the economy. During an event at the Federal Reserve Bank of Philadelphia last Friday, Bank of Canada deputy governor Timothy Lane said that he envisions a future where the Bank of Canada issues its own digital currency before other alternatives become more widely used for transactions within the Canadian economy. The Bank of Canada’s digital currency is being explored as a contingency plan once the issuance of a public digital currency becomes necessary. “We’re actually now at a bit of an inflection point where we’re kind of moving from research to something that feels a lot more like contingency planning, because we’re aware that the world can change very quickly,” said Lane. “The world could change in a way that would very rapidly transform the way that people pay for things. And if we start to think about what we might do in reaction to that when that starts to become evident, then that’s going to be too late.”
Read the full article from Financial Post here.
Negative Interest Rates Could Drive Greater Crypto Investment
November 17 – CoinShares, a digital asset management firm, has released its Crypto Trends Report for November 2019 which suggests that negative interest rates could soon pressure traditional banking models and shift advisor investment strategies in favor of cryptocurrencies. The report suggests that a combination of negative interest rates, dovish monetary policies, Brexit, and the upcoming federal election in the United States could be spurring demand for bitcoin, which has established itself as a form of “digital gold” over the last several years due to its fixed supply and non-correlation to some traditional asset classes. Bitcoin’s spot markets have become more matured thanks to the introduction of physically-settled futures and other institutional-grade custody services coming online this year. On a global scale, bitcoin has now established a myriad of on and off-ramps, and the report suggests that this gives it advantages over physical gold in terms of trade.
Read the full article from Bitcion Exchange Guide here.
Bitcoin and Ethereum are ‘Formidable Collateral Economies’
November 18 – In a recent Tweet, Chris Burniske, an early cryptocurrency advocate and influencer, noted that both Bitcoin and Ethereum are already representing “formidable collateral economies” which are moving beyond just being mediums of exchange. According to Genesis Capital, the cryptocurrency lending sector had a record-breaking third quarter of $870 million USD in new originations. Burniske suggests that Ethereum, in particular, has a burgeoning collateral economy being built around it, which could decrease its future volatility or perhaps increase ether prices as supplies become increasingly locked up as collateral within decentralized finance (DeFi) platforms. However, some experts claim that bitcoin will remain the most common form of collateral within DeFi. “BTC’s ‘collateral economy’ is much larger than ETH’s — BTC is the primary form of collateral for derivative markets that have cleared more than $1 trillion in annual trading volume. Similarly, Genesis Cap shows time and time again that BTC is the best collateral for crypto loans,” said Max Bronstein of Coinbase in a tweet.
Read the full report from U.Today here.
Worldwide Bitcoin ATMs Hit New Milestone, Surpassing 6,000
November 17 – According to the online resource CoinRadar, the number of bitcoin ATMs installed around the world has now surpassed a new milestone of 6,000. The United States is home to 3,924 bitcoin ATMs, while Canada is home to 653 ATMs. The remaining ATMs are found within Europe and Asia at 20% and 2% of the total ATMs, respectively. The number of new ATMs has increased by around 1,000 since June 2019, indicating that the industry has grown significantly this year. In October, Miami International Airport installed its first bitcoin ATM with hopes of providing convenience for international travelers who prefer to use the cryptocurrency for payments. “More and more people prefer to travel with Bitcoin instead of cash for convenience and security. Miami International Airport is a perfect place for our customers to conveniently exchange their dollars for Bitcoin and vice versa when traveling domestically or abroad,” said Doug Carillo, the chief strategy officer Bitstop, a Bitcoin ATM firm.
Read the full article from Coin Telegraph here.
The Peoples Bank of China Wants ‘Controllable Anonymity’ for China’s Digital Currency
November 12 – An official at the People’s Bank of China (PBOC) has announced that its planned digital yuan may balance functionality with anonymity due to demand from the general public. “The demand from the general public is to keep anonymity by using paper money or coins,” said Mu Changchun, the director-general of the PBOC’s Institute of Digital Currency. “We are not seeking full control of information on the general public.” The PBOC is expecting to use some form of “controllable anonymity” for “people who demand anonymity in their transactions”, while at the same time, the digital currency “would keep the balance” to ensure that anti-money laundering and anti-terrorist financing rules within the country can still be followed. Mu Changchun announced that China would not be targeting capital markets or trade-financing centers with its planned digital currency just yet, although he did not rule out these initiatives in the future. According PBOC officials and patents registered by the PBOC, consumers or businesses would be able to download a digital wallet on mobile devices, then move cash from traditional bank accounts into these wallets to later send or receive payments from other wallet users.
Read the full article from the Bloomberg here.
3iQ Bitcoin Trust (Class A) : NAV as at November 15, 2019
Underlying cryptoasset prices sourced from Bloomberg.View charts and more fund data at https://www.theglobeandmail.com/investing/markets/funds/FBCBT.CF/performance/
3iQ Global Cryptoasset Fund (Class A): NAV as at November 15, 2019
Underlying cryptoasset prices sourced from Bloomberg.View charts and more fund data at https://www.theglobeandmail.com/investing/markets/funds/TIQ101.CF/performance/
3iQ Corp. (“3iQ”) is the first Canadian investment fund manager to agree to terms and conditions with the Canadian securities regulatory authorities which permit 3iQ to manage a multi-cryptoasset investment fund available to Canadian accredited investors. 3iQ provides accredited investors with exposure to bitcoin, ether, and litecoin through its 3iQ Global Cryptoasset Fund.