Business & Investment

Digital currencies gain momentum in US and China-Bankers in Asia

Along Bush Pu

U.S.’s largest crypto platform unveiled, speeding up China’s digital yuan test

  • The S & P Dow Jones Index announced a new cryptocurrency index a few weeks after Coinbase was released on the Nasdaq.
  • China’s digital yuan accelerates after deploying a pilot program covering 10 cities and the venue of the Winter Olympics
  • Will the CBDC and cryptocurrencies cross the path in the future?

Coinbase, the largest cryptocurrency exchange in the United States, was released to the Nasdaq under the code “COIN” and became the first large cryptocurrency company listed in the United States. Financial Times He commented that Coinbase’s list represents the “coming-of-age moment” of cryptocurrencies.

S & P Dow Jones Index Announces New Cryptocurrency Index

S & P Dow Jones Index, a world-leading index provider and joint venture of S & P Global, CME Group and News Corp., has officially launched a new set of digital asset benchmarks, the S & P Digital Market Index.

The new S & P Digital Market Index series includes the S & P Bitcoin Index, S & P Ethereum Index, and S & P Crypto Megacap Index, showing the performance of each digital asset listed on recognized open crypto exchanges. To measure.

“As cryptocurrencies have become more mainstream, investors have access to reliable and transparent benchmarks backed by institutional quality price data. Further expanding the new family of digital market indexes, this We look forward to bringing the very necessary transparency to exciting markets, “said Peter Loffman, Global Head of Innovation and Strategy at the S & P Dow Jones Index.

Cryptocurrency platform Coinbase is now available on Nasdaq

The launch of the new cryptocurrency index is just a few weeks after the direct listing of Coinbase, which was seen on the market as one of the groundbreaking developments of cryptocurrencies.

With a market capitalization of approximately $ 86 billion, Coinbase became the most valuable US exchange after the first day of trading, close to the combined market value of the Intercontinental Exchange, which owns the Nasdaq and New York Stock Exchanges.

Coinbase’s list soared in cryptocurrency prices, and Bitcoin hit a record high of just under 65,000 days on the list. Bitcoin has more than doubled this year, attracting large investors such as Goldman Sachs, Morgan Stanley and Tesla.

However, Coinbase shares have lost more than 30% of their value since their peak on April 14, after Bitcoin fell 5% to $ 48,886, worried about US President Joe Biden’s funding plans. , Below $ 50,000 for the first time since early March. Gain taxes have a negative impact on your investment in digital assets.

Founded in 2012, Coinbase is the first officially licensed cryptocurrency exchange in the United States, headquartered in San Francisco. It trades primarily in 59 currencies, including Bitcoin and Ethereum, with a total of 56 million users.

Coinbase generated revenue primarily by charging fees and fees for investors to buy and sell cryptocurrencies, but the popular wallet service remains free.

As the US Securities and Exchange Commission (SEC) filings show, Coinbase’s trading volume reached $ 335 billion, with total first-quarter revenue of $ 1.8 billion, up from last year’s total of $ 1.3 billion. First-quarter assets increased from $ 90 billion to $ 223 billion, accounting for 11.3% of the market share of digital assets.

As of April 2021, Coinbase is ranked the world’s second largest cryptocurrency exchange in terms of spot trading volume, with 24-hour trading volume eight times higher than Binance. Binance is also traded in 358 currencies, well over 59 in Coinbase. Binance CEO Changpeng Zhao said he has no plans to follow Coinbase’s path and publish in the near future, given ample cash reserves and healthy growth.

China’s digital yuan accelerates after deploying pilot program

On the other side of the Pacific, China, which decided to issue the Central Bank Digital Currency (CBDC) first, accelerated the test of the Digital RMB (RMB).

Li Bin, head of the People’s Bank of China’s (PBoC) Macroprudential Policy Bureau, said the tests began in late 2019 at the venues of the Shenzhen, Suzhou, Yuan, Chengdu and Beijing Winter Olympics. Six new pilot areas in Shanghai, Hainan, Changsha, Xi’an, Qingdao and Dalian, have been added by October 2020. This is the first time the central bank has announced that it will extend its digital RMB pilot program to “10 + 1” or 10 cities and the Beijing Winter Olympics. Venue.

“At this point, the pilot area is generally still in the testing stage. So far, there is no official launch schedule,” Li said. The PBoC will also consider expanding the digital yuan for cross-border payment transactions when conditions are met, said Wang Xin, head of the Research Bureau.

“Recently, with the support of the Bank for International Settlements (BIS) Hong Kong Innovation Hub, PBoC’s Digital Currency Institute, the Hong Kong Monetary Authority (HKMA), the central bank of Thailand, and the Arab Emirates. We have jointly launched a multilateral CBDC bridge research project to investigate the application of CBDC in cross-border simultaneous payments using technology, “Wang added.

PBoC is a Belgium-based SWIFT financial messaging service and Finance Gateway Information Services Co. We have established a joint venture called. Other shareholders of the entity include China’s Cross-Border Interbank Payment System (CIPS) and China’s Payment and Clearing Association, both overseen by PBoC.

Will the CBDC and cryptocurrencies cross the path in the future?

Thirteen years after the invention of Bitcoin, the direct listing of the S & P Digital Market Index and Coinbase is two more milestones in the unstoppable trend of cryptocurrencies becoming mainstream.

With China’s pioneering CBDC, the world’s central banks are no longer defending, especially in the face of the imminent threat of cryptocurrencies from so-called stable coins to monetary sovereignty. According to a January 2021 BIS survey, 86% of central banks around the world are actively investigating the potential of CBDC, 60% are experimenting with technology, and 14% are deploying pilot projects. I am. One-fifth of the world’s population may have a general-purpose CBDC over the next three years.

Brian Armstrong, CEO of Coinbase, has witnessed the fast pace of CBDC development and has announced his intention to add CBDC to its trading platform. “We at Coinbase are cryptocurrency agnostic. We support all cryptocurrencies, including the CBDC and stablecoin, as well as decentralized ones like dai, as long as they meet the criteria on the list.”

Cryptocurrencies and the CBDC are gaining more traction in parallel, so they should not be mutually exclusive. Symbiotic public-private partnerships can and need to be formed when critical issues such as data privacy, compliance monitoring, and network security can be addressed in concert.

Agustín Carstens, General Manager of BIS, said:

Digital currencies gain momentum in US and China-Bankers in Asia Digital currencies gain momentum in US and China-Bankers in Asia

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