“The launch of the energy efficient Ethereum 2.0 network will popularize the proof-of-stake consensus mechanism and make staking yields a more attractive source of income for both institutional and retail investors according to a new JPMorgan report.
The two senior analysts also compared the financial incentives with staked cryptocurrencie to cash, cash equivalents, and fixed income instruments like U.S. Treasury bonds:
Yield earned through staking can mitigate the opportunity cost of owning cryptocurrencies versus other investments in other asset classes such as US dollars, US Treasuries, or money market funds in which investments generate some positive nominal yield. In fact, in the current zero rate environment, we see the yields as an incentive to invest.”
“Before banks and financial institutions can get involved in automatic anonymous lending, permissioned versions of decentralized finance (DeFi) will have to emerge – and with it, a system of whitelisted and blacklisted wallet addresses, according to Aave founder Stani Kulechov.
Kulechov said permissionless DeFi will always exist, but there will also be “layered and tailored” DeFi made up of private pools and whitelisted markets. Fireblocks is assisting Aave to explore how such markets can be deployed.
We are able to basically validate and vet them into the network and essentially create this sort of gated community.
Novogratz of Galaxy pointed to two options going forward: the “walled garden” approach being explored by Fireblocks and Aave, and what he called the “chain surveillance option” where enough work can be done to figure where transactions are coming from.”
“The U.S. Congress Oversight and Investigations Subcommittee, a division of the House Financial Services Committee, summoned cryptocurrency experts on Wednesday.
Representative Tom Emmer was concerned that America may not get the full benefit from its cryptocurrency entrepreneurs if innovation is stifled by lack of clarity in regulation, and his concerns were shared by many other representatives and crypto experts.
He called for a robust classification system for digital assets to determine whether cryptocurrencies are securities, commodities, or merit the same treatment as fiat. He also highlighted the potential that Bitcoin and blockchain platforms have to offer in creating better transparency and trust than traditional systems.
Unlike Rep Sherman, the majority of the members of Congress were eager to find out more about cryptocurrencies, including their impact on market volatility, the environment, and much more besides.”
“The Cayman Islands’ financial regulator has joined a list of watchdogs globally that are scrutinizing Binance and its business dealings.
Binance Group and Binance Holdings Limited are not registered, licensed, regulated or otherwise authorized by the Authority to operate a cryptocurrency exchange from or within the Cayman Islands.”
“Bitcoin mining uses a negligible amount of energy, is rapidly becoming more efficient, and is powered by a higher mix of sustainable energy than any major country or industry.
The estimate was based on a three question survey of just 32% of the miners on the network. It found respondents “are currently utilizing electricity with a 67% sustainable power mix” which it used as the basis for its 56% estimate across the overall network. The validity of the data and estimates resulting from BMC’s survey is unclear, as it relies heavily on voluntary and self-reported responses from just a subset of the network.
The BMC defines sustainable electricity as “hydro, wind, solar, nuclear, geothermal, and carbon-based generation with net carbon credits,” which are based on principles from the International Energy Agency’s (IEA) Net Zero by 2050 report.”