Hey everyone! Today, we’ve got stablecoins,
we’ve got gold, we’ve got our boy Eric
Crown, and somewhere in a quiet corner the
NSA is making quantum resistant cryptography.
Everything just seems to sound cooler with
“quantum” in its name, doesn’t it? This
is the Cryptocurrency News with Giovanni.
Stablecoins are on the menu for today. Binance
has partnered with digital asset trust company,
Paxos, to launch a USD-backed stablecoin called
Binance USD or BUSD. The stablecoin has already
received approval from the New York State
Department of Financial Services and will
be available for direct purchase and redemption
on the Paxos platform at a 1:1 ratio to US
dollars. This may not be the most exciting
news in the world (I mean, we’re talking
about stablecoins after all) but it showcases
Binance’s abilities to work within the US
(and particularly the NY) regulatory system,
which is not something many other companies
are able to do effectively. Paxos certainly
has experience working within US regulations,
(as we’ll see in a minute) so the partnership
appears to be a fruitful one. It will also
be interesting to see if Binance’s Venus
project will be able to navigate regulations
with the same ease.
Speaking of Paxos, I’ve got some good news
for all you gold bugs out there! Paxos has
received approval from the New York financial
regulators to launch a new gold-pegged Ethereum
token called Pax Gold. Each PAXG token will
be pegged to a physical ounce of gold stored
in a London vault. Essentially, this allows
you to own gold without having to pay a custody
fee and gives you the ability to send it around
the world at any given time on any given day.
This is clearly a move to bridge the gold
and crypto markets, and I don’t know about
you, but I’m curious to see how this bridge
holds up given the ongoing competition between
the two markets.
The new stablecoin also aims to solve gold’s
biggest problem, which is the fact that it
exists… physically I mean. Just imagine
trying to lug a pile of gold through, say,
airport security. Doesn’t sound like much
fun, does it? Well, with PAXG, you can trade
and hold gold directly, without ever needing
to even see it. Best of both worlds, maybe?
This could also finally make Mark Mobius happy.
In an interview yesterday, the founder of
Mobius Capital Partners said, “If there
is a cryptocurrency that is really backed
by gold — and that is, there is a meaningful
agreement and some kind of modern thing of
this connection — then this could be quite
interesting.” Well, Mr. Mobius, your query
may be answered in a very timely fashion with
the arrival of PAXG, so be sure to keep a
close eye on its progress. How do you guys
think this gold-backed crypto will affect
the crypto and gold markets?
Crypto activist Joe Kernen offers another
perspective by pointing out that there aren’t
really any fiat currencies that are backed
by gold, so why would a crypto need to be
backed by gold? Would it accomplish anything
more than just linking the two markets? I
guess the heart of this issue is how far does
our faith in the global economic system, be
it bank, fiat, or blockchain, really go? Where
does your faith lie: in the physical, virtual,
or somewhere in between?
The US National Security Agency is “working
to build a quantum resistant crypto”, but
it might not be in the way that you think.
Even though “quantum resistant crypto”
sounds dope, the “crypto” bit actually
stands for cryptography, not cryptocurrency.
Still, blockchain technology is fundamentally
based on cryptographic technology, so this
could certainly impact our current systems.
So what exactly is “quantum resistant cryptography”?
Well, first we need to talk about quantum
computing. Without getting too technical,
let’s just say that if quantum computers
are ever fully developed, they would enable
a drastic increase in computing speed and
capacity. This could potentially render the
security aspect of blockchain technology as
useless. In fact, quantum computers could
be so powerful that they would be able to
unwind the encryptions that protect private
cryptocurrency keys as they pass through the
Apparently, NSA officials are concerned that
quantum computing might eventually represent
a threat to US national security.
I know, that sounds scary, but let’s not
panic… at least not until quantum computers
are invented…
Something big is moving on the Bitcoin blockchain.
1B$ worth of Bitcoin were moved to a single
wallet on September 5th. The sender paid a
transaction fee of $700 – which isn’t exactly
pennies and dimes – meaning he probably wanted
the transaction to be settled as fast as possible.
According to some theories, the transaction
was related to Bakkt, which starts accepting
Bitcoin deposits on its new platform, Bakkt
Warehouse, today.
This platform will be the custodial of the
long-awaited Bitcoin futures contracts, which
will launch on September 23rd. Bitcoin futures
will enable physical delivery of Bitcoin,
instead of cash, when the contracts close.
We reached out to prominent crypto trader
and Youtuber, Eric Crown, to help understand
why the Bakkt Bitcoin futures are an important
turning point.
Erik, can you explain what is the difference
between physically delivered and cash settled
Bitcoin futures?
So physically delivered means that at expiration,
the holder is essentially going to not be
paid in cash, but in actual bitcoins. So that
means that Bitcoin stays in the market.
Now a lot of people will kind of argue that
that’s a huge difference. And yes, it will
make a difference from just regular cash settled
type of settlements, I suppose you could say.
However, because this market doesn’t operate
in a vacuum, because everyone’s doing arbitrage
and on all these different exchanges, the
actual effect in reality probably won’t be
too much more noticeable. As anytime that
someone is trading on CME, for example, which
are cash settled, they’re gonna be arbitraging
or essentially market against some other index
on bitcoin. So they’re always pointed in somewhere
else in measuring things off Bitcoin to begin
Ok, and what kind of impact will Bakkt Bitcoin
futures have on Bitcoin price and the space
in general?
Bakkt is, you know, is kind of a big deal.
Again, just another more institutional great
venue offering, offering bitcoin trading essentially
makes it easier for people get into it so
by that metric, yes, you know, just ease of
access increases. Barriers are kind of shut
or brought down a little bit, we have more
people trading.
Thank you, Erik, see you next time.
Also, guys, let’s check how smart (or lucky)
you are! Post your best guesses for what the
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9, at 7 am Eastern Standard Time. The closest
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This has been Giovanni with the Cryptocurrency
News. Always remember to like, subscribe, and hodl!