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A Bitcoin a day, The El Salvador Way...

GB Market Commentary 17/11/2022

by Adrian Kenny

The wider crypto markets are still reeling from the recent FTX saga and following contagion. The largest cryptocurrency, Bitcoin is currently trading at $16,607.73 with a movement of -0.35% in the last 24hrs and Ethereum currently at $1,205.18 a decrease of -0.9% in the last 24hrs. The overall crypto market remains unsettled with many indicating it may take a while to stabilise in the mid to short-term reducing the total crypto market cap by 1% down to $835b.

The bearish sentiment is set to continue, particularly after the news yesterday, that Genesis trading would halt withdrawals.

Interim CEO Derar Islim messaged customers:

"Genesis Global Trading's lending arm will be temporarily suspending redemptions and new loan originations in the wake of FTX's collapse".

Genesis Global Capital currently have circa $2.8b dollars of institutional client loans (as of Q2 2022). The company statement goes on to ensure clients that “Genesis Custody and Trading Services”, a separate arm, were continuing with no issues, certainly a story to watch closely as it unfolds.

There is however some good news for regulation stemming from the recent "Black Swan" events linked to SBF and the now infamous FTX exchange. The UK government, under the new premiership of the "Crypto friendly" Rishi Sunak are preparing to release a statement in the coming days on regulatory clarity in the crypto sector, the statement is expected to also begin paving the way for stable coin legislation and a workable crypto payments framework.

This regulatory wind has also found its way to the other side of the world, as the Australian Treasury has also announced that following the FTX debacle it "Has doubled down on its commitment towards a robust regulatory framework", a spokesperson for the Australian Treasurer Jim Chalmers said. The Australian Treasury is planning a framework to ensure consumer protection and hopes to have in place by early 2023.

El Salvador however have taken a different approach, and in what can only be expected at this point El Salvador buys the dip! The Latin American country, where Bitcoin is legal tender, announced it will be buying 1 Bitcoin a day.

The now famous Bitcoin evangelist, Nayib Bukele, leader of El Salvador took to Twitter to announce the country's latest spending spree after months of quiet due to turbulent market conditions. El Salvador currently holds 2,381 BTC, purchased at an avg market price of $43,357.


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