The crypto sector is at a crossroads, says OCC director Brian Brooks

Brian Brooks, who heads the US Office of the Comptroller of the Currency, said crypto regulation could focus on participant security or thwart all progress in the sector

The last half of 2020 was marked by record prices for Bitcoin (BTC) and a number of important regulatory Golden Profit developments, such as the approval of crypto custody services in national banks by the Office of the Comptroller of the Currency, or OCC. However, at the moment, legislation in the digital asset sector has an uncertain future ahead, as several government roles are set to change in early 2021, is the view of former Coinbase executive and current OCC director, Brian Brooks.

„I can’t talk about specific price movements, but I’ll tell you what worries me,“ Brooks explained on Friday in an interview with CNBC, during a discussion centred on the new records set by Bitcoin. Brooks commented:

„This is all happening in the context of an upcoming transition of presidential administrations and Capitol Hill is under pressure to remove some of the regulatory protections that we’ve put in place.“
In recent weeks, there have been several regulatory proposals related to the crypto industry, including rumours of a ban or limitations on self-custodian crypto wallets. Several members of Congress have reacted by expressing concerns about the potential measure. In addition, a new bill aims to impose strict regulatory requirements on stablecoins.

„My office has been trying to make stablecoin services more secure in national banks,“ Brooks said. „We’ve talked about banks supporting some of these stablecoin projects. If these protections are not in place, I’m really concerned about the environment in which these initiatives operate.“ Brooks added that he wants to maintain security within the crypto landscape.

In early November, Brooks‘ big steps towards security and growth in the crypto industry were met with critical reactions expressed in a letter written by several members of Congress. Some political leaders pushed back, suggesting that the OCC under Brooks‘ leadership had focused too much on the industry.

In his interview with CNBC, Brooks pointed out that crypto is at a crossroads in terms of regulation: „Right now we’re at a really critical turning point,“ he explained . „It’s kind of a crossroads.“ One of these paths aims to improve security in the market by working on the ecosystem around illegal crypto transactions, and banks are a vital part of the equation.

The second path appears more tragic for the industry. „The other route, which is currently a very real possibility, is the politicisation of some of these technical issues, whether it’s crypto or fintech more generally,“ Brooks warned, adding:

„Politicisation would cause the undoing of all the good work that this administration has done to make the industry safer, more real. If we do things like that, such as those suggested recently in Maxine Waters‘ letter, I’m not sure there’s enough of a base to move forward. It all depends on consolidating the regulatory advances and consumer protections that we’ve been trying to implement.“
In early December, Waters sent a letter requesting a halt to financial regulatory developments until government positions are consolidated in 2021. Back in 2019, Waters intervened in the crypto sector by halting Facebook’s Libra project (now called Diem) following the publication of its white paper.

Ethereum is targeting $ 780, while these 3 indicators do not rule out an early market correction

The Ethereum (ETH) price rises and falls. The picture shows an Ethereum Coin and price candles in the background.

While everyone is watching the Bitcoin course with awe, it is worth looking to the left and right from time to time due to the high correlation of most cryptocurrencies with one another. In the case of Bitcoin , of course, all that remains is to look down and the first thing we see there is Ethereum . Therefore, today we want to devote ourselves to an extensive Bitcoin Code course analysis in order to filter out how the crypto market is currently doing.

We want to examine the current upswing at ETH from two different directions. It gets interesting because both perspectives weight opposing scenarios differently. According to the bullish point of view, the Ethereum course is already targeting $ 780. The bearish view, on the other hand, sees a drop in prices as low as $ 455 as possible.

In this analysis I will show that, according to the technical chart analysis, both perspectives are justifiable variants with valid arguments. At the end we will try to decide which of the two variants is the more likely. $ 780 or $ 470 – what would you like? Let’s find out together!

Ethereum rate of $ 780 or more

Because it currently suits the mood of the market so well, let’s first look at the bullish perspective for the Ethereum course.

An ascending triangle can be read off the daily chart based on the price movements, which is considered a reliable and bullish pattern. With the help of this bullish pattern, one could theoretically have predicted the recent upward breakout of the Ethereum price.

At first glance, the pattern seems to correspond to the ideal type. The horizontal upper trend line was a clear resistance, while the upward trend line represented the support line for the Ethereum price. Together they form the ascending triangle.

Both trend lines are touched by the price often enough and the volume development seems to fit the pattern perfectly. After the breakthrough, the Ethereum price also seems to have already converted the upper trend line into its new support line. So you could say that everything is currently going according to the textbook.

Ethereum price forecast, ETH price

As I have already drawn in the above chart, a minimum price target can be calculated with the help of the chart formation. We get this by measuring the height of the formation and then projecting it onto the upper horizontal trend line. This gives us the minimum price target of $ 780 for the Ethereum course.

In the case of an ascending triangle, the minimum price target is reached in 89% of the cases after the breakthrough. In other words, according to this chart formation, a further price increase for ETH of 20% or more is very likely.

So much for the bullish view of current events. Now let’s take a look at a more pessimistic account of the current situation.

Bitcoinvalar som säljer till institutioner som gråskala lägger till 7188 BTC på 24 timmar

En enorm försäljningsvägg på 20 000 dollar kan se en stor överföring av välstånd från valar till institutioner baserat på aktuell data.

Valar av Bitcoin (BTC) verkar sälja till institutioner då utbudet pressas åt under 20 000 dollar.

Uppgifter från olika källor visar att medan fler BTC återvände till börser den här veckan, skapar stora köpare fortfarande mer efterfrågan än utbudet kan möta.

Byt inflöden och inköp av gråskala

Statistik från analystjänsten Coin98 bekräftade att investeringsjätten Grayscale köpte dubbelt så mycket Bitcoin som gruvarbetare kunde skapa i november.

Tillsammans med Square och PayPal, de andra stora företagsaktörerna som kräver fler och fler BTC-aktier, skapar Grayscale en leveransobalans där kursvinster är det enda logiska resultatet.

Detta scenario satte scenen för december med Grayscale som fortsatte sin köp av Bitcoin, totalt över 7000 BTC på bara 24 timmar, eftersom dess Bitcoin Assets Under Management nu överstiger 10,5 miljarder per den 4 december.

Samtidigt såg Bitcoin den här veckan hela tiden och utmanade 20 000 dollar, bara för att stöta på massivt försäljningspress.

Efter att ha studsat nedåt på $ 18,100 och återgått till $ 19,000-cirkeln, ser BTC / USD ut som en ny test av seminalnivån, men försäljningsdynamiken är fortfarande ovanlig. Med säljväggar på 20 000 dollar fortfarande på plats, har långvariga hodleder och valar som vill gå ut pålitliga köpare i form av gråskala och andra institutioner.

Bevis pekar på ökande tillströmning från val till utbyte den här veckan, något som sammanföll med 20 000 dollar-försöket. Skulle försäljningen redan hålla priserna nere, bör BTC alltså hitta sin väg från valar till de starkare händerna på Grayscale och dess kunder.

CNBC: De rika „laddar upp“ på Bitcoin

Fenomenet har till och med fångat uppmärksamheten hos vanliga medier.

„Totala konton som köper mer än 1 miljon dollar i Bitcoin och sedan flyttar det från börsen har skjutit i höjden“, rapporterade CNBC på torsdag.

”Det har ökat 180% från 2017 till i år. Analytiker säger att signaler rika investerare laddar upp på Bitcoin och sedan lagrar det offline för att lagra någonstans lite säkrare. ”

Samtidigt slog de totala Bitcoin-adresserna i vinst mot när mynt placerades i dem nya rekordhöjder på fredag, enligt de senaste uppgifterna från Glassnode.

På Wall Street kom under tiden nyheter på torsdagen att Bitcoin och hundratals altcoins skulle komponera nya kryptovalutaindex av S&P Dow Jones Indices från januari 2021.

Bretton Woods 2.0 is knocking on our door and it is not to help

A second Bretton Woods era will be even more centralized and far from a true democracy.

Just 100 years ago, in the early 20th century, people could exchange dollars for gold at their local bank. While gold was too difficult to trade between people, the banking institutions had gold and gave people cash. This was during what became known as the gold standard. The value of each sovereign currency was determined in relation to a fixed amount of gold. However, over the next few decades, that standard changed rapidly.

Towards the end of World War II, dozens of powerful people organized a meeting to discuss a new monetary arrangement designed to minimize the economic damage caused by the war. This meeting was named after the place where it took place: Bretton Woods, New Hampshire, in the United States.

It was a long-term plan with several parties that spanned decades. And the Bretton Woods delegates decided that the multiple trust currencies would now be backed by the US dollar instead of gold itself. At first, the dollar proved stable enough to support the Bretton Woods agreement in 1944, until it became so in subsequent decades. During the Vietnam War, President Richard Nixon asked for more money. There was no more money in circulation. So he started printing.

In 1971, President Nixon ended the convertibility of the dollar into gold, which ended the Bretton Woods agreement after almost 30 years.

The elimination of the gold standard turned each country’s trust currency into a floating exchange rate that was no longer fixed. Money was no longer measured in dollars; each currency was now measured against any other currency, with prices constantly changing, creating volatility in the foreign exchange market.

Bitcoin as an opposition

Today, one asset with which trust currencies are measured is Bitcoin (BTC). As I mentioned in 2019, I believe that Bitcoin is the best investment when it comes to coins in the solid money sense.

In certain countries, such as Brazil, Argentina and Venezuela, to name a few, the price of Bitcoin is currently at an all time high compared to their national fiat currency. In relative terms, that would mean that the price of Bitcoin is already around USD 20,000.

The problem is that Bitcoin is not ready to be a monetary system on its own. Most people who own Bitcoin only have it, do not sell it or use it as a currency because of its potential to appreciate rapidly, despite the downside risks.

Bretton Woods 2.0

Meanwhile, the International Monetary Fund is now calling for the announcement of a second era of Bretton Woods in 2020. This would establish the Special Drawing Right, or SDR, as the new reserve currency in place of the US dollar. The SDR serves as the most stable investment option for the IMF. Its value consists of the five major global fiat currencies as protection against volatile movements in foreign exchange markets. The problem with the SDR approach is that it could make the economic situation even worse than it is at present.

History has shown that when people have an inflated amount of power over money, they will use it. Just look at President Nixon during the Vietnam War and the original Bretton Woods agreement in the mid-20th century. Even worse is that now, almost all central banks are printing more money, which in turn leads to inflation as fiat currencies lose their purchasing power.

We cannot have a single powerful entity with the power to print itself out of temporary problems, especially when it would put us into future debt that would be impossible to manage. This is the opposite of democracy, where only a few people control the big monetary decisions that affect everyone. Crypt coins such as Bitcoin aim to solve this dilemma, thanks to their limited supply, among other favourable qualities inherent in the Blockchain technology.

The Blockchain technology has a solution

Blockchain has raised our standards to expect decentralization in the institutions that are meant to serve us. True decentralisation is achieved when the hierarchy is broken. Everything becomes transparent and incentives are given to push the system in the right direction.

Sogur, for example, is a startup that faces the ambitious challenge of creating a new monetary system based on its MGS cryptomoney that models the RDS while taking advantage of Blockchain technology and intelligent economic design advised by world-renowned economists.

I like the idea of currency baskets that serve as a much more reliable and stable medium of exchange. I do not like that the IMF has unlimited decision-making power over our global monetary system. Blockchain-based solutions are different: they have a basis that is governed by an assembly and, for example, can give MGS holders veto power over every decision at any given time.

Blockchain technology can combine the elements of decentralised governance into a classic corporate structure, in order to comply with international laws and anti-money laundering requirements, while using a smart contract-based bonding curve to control inflation and volatility, which remain two of the biggest problems with traditional fiduciary currencies that can be solved.