Though we’re only four weeks into it, 2021 has been a big year for cryptocurrency. While there has been a multitude of news items in the crypto space, there are a handful of items worth highlighting.
Though much of the cryptocurrency news cycle is often quite hyped, it’s important for the traditional financial sector to keep their finger on the pulse of major news pieces in this space, especially as the decentralized finance trend takes off. That said, here are six things you need to know about what’s going on in the cryptocurrency realm:
Elon Musk stands bullish on Bitcoin
The price of Bitcoin hit an all-time high at the beginning of January of this year. A few weeks later, during an interview on Clubhouse, Tesla CEO Elon Musk said, “I do at this point think bitcoin is a good thing. I’m late to the party, but I am a supporter of bitcoin.”
This vote of confidence for the popular cryptocurrency didn’t send the price of bitcoin to the same highs that we saw on January 8. It did, however, offer it a nice boost in price and a stamp of approval that will be beneficial in boosting the cryptocurrency’s legitimacy.
Ethereum hits all-time high
The price of Ethereum reached an all-time high today, this time breaking the $1,600 mark. Fueling the surge is the pending launch of ethereum futures on the Chicago Mercantile Exchange next week.
While bullish buyers expect to see the price top out around $2,000, others anticipate it will level off.
The Indian government dances around a cryptocurrency ban
India is notorious for its hot/cold relationship with cryptocurrency. In 2018, the country’s central bank banned offering banking services for digital asset firms, but the Supreme Court overturned that ruling last year.
This week, the Indian government revealed that it will likely seek to regulate cryptocurrency, instead of ban it.
Visa announced plans to enable cryptocurrencies trading on its network
In an earnings call, Visa CEO Alfred Kelly said that he wants to make cryptocurrencies “more useful and applicable for payments.” To accomplish this, Kelly sees Visa working with wallets and exchanges to enable users to purchase cryptocurrencies using their Visa card or to cash out onto a Visa card to make a fiat purchase at a traditional merchant.
During the call, Kelly disclosed that the payments giant is already working with a handful of digital currency platforms and wallet providers to serve as their card issuer. This list includes crypto.com, Blockfi, Fold, and Bitpanda.
The OCC OK’d stablecoins
In the first week in January, U.S. Office of the Comptroller of the Currency (OCC) last week published Interpretive Letter 1174 detailing that banks may use stablecoins and independent node verification networks (INVNs) to facilitate payments for customers. Simply put, banks can transfer stablecoins to other banks.
This development happened under the watch of Acting Comptroller of the Currency Brian Brooks, who stepped down mid-last month. Taking Brooks’ place is Blake Paulson, whose attitude toward cryptocurrencies is untested.
Gemini began offering a savings account
Cryptocurrency exchange Gemini is starting to step on traditional banks’ toes. That’s because the New York-based company is launching a savings account called Earn that allows users to move their crypto holdings into high-yield savings paying as high as 7.4%.
Thanks to Gemini’s business model, it can afford to pay the high rate. That’s because it lends users’ cryptocurrency deposits to other borrowers through its partner, Genesis Global Capital, at a higher interest rate.