What’s Happened to Gemini Dollar? Supply Down 92% YTD

Gemini Stablecoin

Demand for exchange’s native stablecoin, dollar (GUSD), has dropped significantly over the last 7 months while other pegged-value assets continue to soar.

Gemini Dollar Falls Behind

The market capitalization of the dollar-pegged token has been on its way down since December 20, 2018. It has slipped from an all-time high of $103.106 million to $7.981 million at the time of this writing, marking a 92.25% drop in just seven months. The same period has witnessed the bitcoin price soaring from $3,126 to $10,336.17, up by more than 230 percent.

Gemini, gusd Gemini dollar

Gemini Market Cap is on a Steady Decline | Image Credits: CoinMarketCap.com

In contrast, other stablecoins are faring far better than Gemini Dollar. Paxos Standard Token, for instance, has a market capitalization of circa $168 million. At the same time, Circle’s USDC is towering high at a supply of circa 406.34 million. Last but not least, the leading stablecoin Tether (USDT) has a total quantity of $4.25 billion, calculated at press time.

Competition is a Killer

In comparison to its peers in the United States, Gemini exchange notices less trade traffic on its platform. Data provided by CoinGecko shows that the Winklevoss Twins’ firm is on the 21st rank in the last 24 hours – with just $60.275 million in daily volume. Coinbase Pro, another US-regulated entity, is hosting about $602.93 million worth of trades on its exchange – 10X the number of volume that Gemini is reporting.

At the same time, San Francisco-based Kraken exchange is processing $340.30 million worth of trades on its platform.

The absence of an adequate competitive edge could be one of the reasons why the demand for Gemini dollar could be dropping. As a dollar-pegged entity, the token allows traders to switch between crypto-assets smoothly without having to convert their cryptocurrencies to the US dollar. As it appears, not many traders demand GUSD, which could be due to Gemini’s presence in a strictly regulated financial market.

There are other competitive factors in play, meanwhile. Tether’s USDT is more visible across the non-US exchanges, especially Binance, despite its contentious status. USDC, on the other hand, has a broader clientele in Coinbase and Circle. Paxos is extra-feasible for its ability to create and redeem stablecoins instantly.

And above all, even the traders outside the Gemini exchange are not keeping many Gemini dollars in their profiles. The community believes it is because of a rebate program Gemini introduced at the time of the launch of GUSD. The firm offered trading companies its stablecoins in discounts in hopes to reduce Tether’s market dominance. But it appears those companies exchanged stockpiles of discounted GUSD units one-to-one for Tether’s USDT and other stablecoins, thus earning free money.

The Great Gemini Dollar Rebound

The demand for Gemini Dollar could go up as founders Cameron and Tyler Winklevoss prepares Gemini to become a broker-dealer. The twins have applied for a license at the Financial Industry Regulatory Authority (FINRA). Upon approval, Gemini would be able to offer to trade in securities, which could boost the demand for GUSD.

Image via Twitter @derekGUMB, Coinmarketcap, Shutterstock

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What’s Happened to Gemini Dollar? Supply Down 92% YTD

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What the CFTC investigating BitMEX could mean for bitcoin and crypto market

The Commodities and Futures Commission () has started an investigation into BitMEX, the largest margin platform in the crypto market, according to a Bloomberg report.

BitMEX, along with other major margin trading platforms, have not allowed U.S. customers to trade derivatives on the platform to avoid scrutiny from U.S. regulators.

The unexpected move of the CFTC comes after the remarks of U.S. Treasury Secretary Steve Mnuchin and his warning against increased efforts to tighten policies around the crypto sector.

Going after the biggest fish in the pond

Last month, BitMEX achieved $16 billion in daily volume across its derivatives products including the widely utilized bitcoin contract the price of bitcoin peaked at $14,000.

BitMEX reaches $16 billion daily volume in June as bitcoin price achieved yearly high
BitMEX reaches $16 billion daily volume in June as bitcoin price achieved yearly high (source: coinmarketcap.com)

Primarily due to the popularity of its bitcoin contracts, BitMEX has secured its dominance over the crypto market throughout the past several years.

However, the CFTC is said to be exploring whether BitMEX has facilitated trades for U.S. customers over the years and whether U.S. customers have been able to bypass restrictions set by the exchange by using virtual private networks or VPN.

A BitMEX spokeswoman told Bloomberg that the company cannot comment on investigations by government agencies. The spokeswoman said:

“HDR Global Trading Limited, owner of BitMEX, as a matter of company policy, does not comment on any media reports about inquiries or investigations by government agencies or regulators and we have no comment on this report.”

Why is CFTC going after the biggest bitcoin margin trading platform?

Earlier this week, during an official White House briefing, Treasury Secretary Steve Mnuchin stated that with the establishment of the Financial Stability Oversight Council’s Working Group on Digital Assets, various financial agencies including the Securities and Exchange Commission (SEC), CFTC, and FinCEN will vamp up efforts to tighten their oversight on the market.

Secretary Mnuchin said at the time:

“The United States has been at the forefront of regulating entities that provide cryptocurrency. We will not allow digital asset service providers to operate in the shadows and will not tolerate the use of the cryptocurrencies in support of illicit activities. Treasury has been very clear to Facebook, to bitcoin users and other providers of digital financial services that they must implement the same anti-money laundering and countering financing of terrorism, known AMLCFT safeguards as financial institutions.”

Secretary Mnuchin added that crypto money transmitters will be subject to the same standards and regulations as every other U.S. bank, indicating that FinCEN is likely to enforce existing regulations on crypto-related entities at full capacity.

The CFTC’s investigation into BitMEX, the decision of Binance to replace crypto-to-crypto trading in the U.S. with a fully regulated exchange called Binance US, and the geopolitical ban on certain cryptocurrencies by Poloniex and Bittrex indicate that companies are increasingly expecting stricter oversight in the near term.

In the short term, the BitMEX investigation could pose a negative effect on the crypto market especially due to the timing, which comes immediately after the release of the remarks of Treasury Secretary Mnuchin.

The post What the CFTC investigating BitMEX could mean for bitcoin and crypto market appeared first on CryptoSlate.

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What trading traditional future markets in crypto means

The latest results released by the Futures Industry Association (FIA) show some extremely encouraging signs. Not only is the futures industry growing exponentially, but 2018 saw a record number of contracts changing hands globally. Futures and options climbed by 20.2 percent from the previous year to 30.28 billion contracts, an all-time record.

The global futures industry is a multi-trillion-dollar one and demand keeps on rising. But it’s also an industry that’s rife with inefficiencies, middlemen, hefty commissions, and decidedly favorable conditions for institutions and the ultra-wealthy.

Everyday retail traders an extremely raw deal they want to try their hand these markets. If ever there were a space primed for disruption, it’s futures.

Thanks to the power of blockchain technology, traders have been buying and selling cryptocurrency futures contracts without the need to be an accredited investor or use an expensive broker. But we’re still testing the waters as far as futures trading and the blockchain go.

Taking Futures Trading to the Next Level

Traders can currently trade cryptocurrency futures on many different pairs, from BTC against the USD to ETH against the GBP. But, there still are no exchanges that allow cryptocurrency futures traders to trade traditional futures markets as well. So, why not–and if there were?

By adding traditional futures markets gold, bonds, stocks, and indices, to cryptocurrency trading, exchanges would be effectively taking the cryptocurrency game to traditional retail traders. We’re talking abou the self-directed trader who currently trades his or her favorite markets without a financial advisor while paying high brokerage fees.

Out of all millennial retail traders worldwide (cryptocurrency’s largest target), around 72 percent describe themselves as “self-directed investors.” This means that they don’t rely on a financial advisor, trader, or broker to invest their money or offer advice. With this new demographic more willing to trade online in new ways, cryptocurrency futures exchanges can tap into a massive and expanding market.

Not only would the cryptocurrency industry be tapping into the multi-trillion-dollar futures industry, but it would be disrupting the status quo and giving traditional retail traders a better deal.

Giving Opportunity to Retail Traders

Allow me to reiterate. We’re not talking about market caps in the millions or billions here–we’re talking about the trillions of dollars. Allowing for the trading of traditional futures markets on cryptocurrency exchanges has the potential to bring more fiat on-ramp and make crypto potentially huge, onboarding traditional retail traders.

Not only will they benefit from lower commissions (or even zero) on the markets they’re comfortable trading, but they’ll also get exposure to cryptocurrency trading for the first time.

The types of markets that can be added has almost limitless potential. Alongside cryptocurrency pairs, traders can speculate on gold, stocks, oil, indices, forex, and more–all the time taking market share away from the enormous futures industry. This will help cryptocurrency exchanges grow and reach more types of traders.

Even if they were only able to unlock a minute percentage of the trillions of dollars generated from the billions of contracts registered by the FIA, they could give traders the potential to make enormous gains!

Giving Cryptocurrency Traders Exposure to Traditional Futures

At the same time as bringing fiat on-ramp and widening the pool of traders, cryptocurrency futures exchanges will also be allowing everyday crypto traders who previously had restricted access to get in on a trillion-dollar market. For the very first time.

This would mean unlocking a ton of value that’s traditionally been held in paper contracts and only available for a select few to trade. Crypto traders of all styles in all places can get their feet wet in an entirely diverse and burgeoning industry. It’s impossible to understate the potential of marrying traditional futures trading with the crypto industry. This revolution is just getting started.

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Libra in Congress: A Chance to Define What Bitcoin Is and What Libra Isn’t

Facebook finished up its second round of Congressional hearings yesterday, marking the end of the beginning for some U.S. Congressional members consider the social media platform’s ill-advised venture into the monetary realm.

The House of Representatives Financial Services Committee hearing, following in the footsteps of the Senate Banking Committee’s own earlier this week, went on for a grueling six-and-a-half hours. project head, David Marcus, spent most of this time trudging through a repeat of some of the Senate’s concerns for AML and anti-terrorist funding practices, while confronting questions about as a systemic risk to the USD’s dominance.

House members did not skewer Marcus over Facebook’s past privacy abuses, but that didn’t stop a few anxiety-laced comments (and one outlandish one) from slipping out during the hearing. Representative Brad Sherman, for example, amazingly said that “Libra may endanger more Americans than [911].” More sensibly, Ann Wagner wants to make sure that “the dollar is not overtaken as the leading international currency that undergirds global economic stability.”  

The most notable difference between the House’s hearing and the Senate’s, though, the thing that makes Libra relevant in the first place: Bitcoin.

Bitcoin Reclaiming the Conversation

Bitcoin, blockchain technology and cryptocurrencies in general were markedly absent from the Senate’s time with Marcus, but in the House, Bitcoin was at least on the periphery of the discussion — as well as at the center of many of the representatives’ inquiries into Libra.

“The reality is, whether Facebook is involved or not, change is here, digital currencies exist, blockchain technology is real and Facebook’s entry into the world is just confirmation, albeit at scale,” Representative Patrick McHenry, a ranking member of the committee, said in his opening statements. “The world that Satoshi Nakamoto … envisioned, and others are building, is an unstoppable force. We should not attempt to deter this innovation, and governments cannot stop this innovation. Those that have tried have already failed … So the question then becomes: What are American lawmakers going to to meet the challenges and the opportunities of this new innovation?”

With his opening statement, McHenry broadened the hearing’s rhetorical scope. No longer was it solely a discussion of Libra, but of cryptocurrency and blockchains writ large and how Libra fits (or doesn’t fit) into this ecosystem.

“[We] must differentiate between Libra and other digital currencies bitcoin,” Representative Ted Budd said.

“Bitcoin is 10 years old, and now suddenly, magically, is responding. After more than a decade, has apparently started to care. I’m glad that is paying attention to the technology that, just like the internet, could upend the way we do everything in our lives,” Representative Tom Emmer emphasized.

Spoken as they were during Marcus’ testimony, these statements were more charges to Congress than lines of questioning. 

“This is not a partisan technology,” Emmer, who co-chairs the Congressional Blockchain Caucus, continued about Bitcoin and blockchain more broadly. “Unfortunately, some people want to unnecessarily suppress or ban it. They fear it. Nothing has been more apparent in this committee than the blind aversion to change … I hope that will be the same approach discussing the depth and breadth of cryptocurrency, which Libra does not represent, but thankfully, amplifies our discussion around.”

Congressman Warren Davidson, who helped to introduce the Token Taxonomy Act, also expressed his hope that the “committee would hold more hearings on cryptocurrencies.”

Libra vs. Bitcoin

“Libra represents an incredible opportunity to define what it is not. It offers an incredible opportunity for this committee to learn more about actual cryptocurrencies,” Emmer said in the conclusion of his speech.

The end of the testimony seemed to transition into sort of Bitcoin and blockchain 101 session. This focus carried over into the blockchain industry panel hosted afterward. Both offered further opportunities to delineate key differences between Libra and true cryptocurrencies.

Libra “borrows aspects of cryptocurrencies but isn’t a cryptocurrency,” Coinshares CEO Meltem Demirors said during the panel. “Bitcoin is a technology … a network … and a cryptocurrency. The technology is not regulated. Much like the internet, it could be considered a public good … Libra is not like bitcoin.”

She continued to explain that Libra’s plutocratic structure would preclude the decentralized, permissionless access that makes something like bitcoin a true cryptocurrency.

“There is a tremendous anticompetitive component,” she said. “This is a private group of 100 corporations … who will be responsible for determining what code Libra runs on, who gets to run nodes and participate in the network and what applications and transactions and products and services will be allowed. This is in sharp contrast to what bitcoin and other open, distribute cryptocurrencies are. They are open for anyone to build on.”

The general consensus in the room, as Davidson’s remarks typified, was “not to conflate cryptocurrency with [Facebook’s efforts].” Most Representatives, even those less seasoned than Davidson, McHenry and Emmer, seemed to grasp the differences. Representative Trey Hollingsworth, for instance, said Libra is “different than a peer-to-peer technology” because it has a “central piece” with which to conduct AML compliance.

This central piece was at the core of defining what Libra is not. Despite Marcus’ insistence on Libra’s decentralization (that Facebook will be “1 of 100” in the Libra Association), Congressional members butted up against the paradox of Facebook spearheading a distributed effort and saying there’s no need to trust them as a central authority.

“But that’s not entirely true, is it?” Maxine Waters asked in her questioning. “The project was Facebook’s idea, Facebook is spearheading it and recruiting partners, Facebook’s subsidiary Calibra will provide consumers with a digital wallet to store libra tokens. As I understand it, no member of the association has paid anything towards the project.” 

Representative Jesús Garcia likened Facebook to “the Godfather” of the Libra cabal.

What Is Libra, Then?

Recognizing that Libra is a different animal than Bitcoin, much of the hearing revolved around the question, “What is Libra?”

“Libra is a reserve-backed digital currency,” Marcus replied. “Under current U.S. law, it might be a commodity, but we see it as a payment tool.” 

Bitcoin, along with a few other decentralized cryptocurrencies, is considered to be commodity under U.S. law. Most tokens, however, are considered securities because their development is centralized. With these taxonomies in perspective, Congress struggled to bring Libra’s specific classification into focus.

“What we’re struggling with [is] ‘What are you?’ You’re a medium, an intermediary, you’re facilitating financial transactions,” Representative Ed Pearlmutter said. To him, he added, that sounds a lot like a bank. 

Congressman Mark Meek thought so, too, asking Marcus whether “Facebook and Libra Associations [would be] willing to establish bank holding companies.”

“You said a while ago that you were going to offer more financial services down the road, but you also said you’re not a bank. Which one is it?” he continued, alluding to Marcus’ claim that “they will not provide banking services.”

Meek, citing a Wikipedia page on the definition of fiat currency, also compared Libra to a fiat currency built on top of other fiat currencies. 

Representative Katie Porter asked how these “basic concepts of [Libra are] fundamentally different from … Wildcat banks” established in the 1800s, which issued currency and IOUs on top of government tender.

Marcus’ equivocating responses to questions like these offloaded the banking responsibilities onto wallets and other service providers on the network, which Marcus insisted will provide competition to Facebook’s Calibra wallet.

Less than a bank to some politicians, Libra’s plans to hold a basket of customer deposits and government securities makes it look like an exchange-traded fund. When McHenry asked Marcus about this, he doubled down on his stance that Libra is a payment tool “more like … PayPal,” Marcus’ former employer.

Cryptocurrencies Are the Future: Will the U.S. Stand in the Way?

Congress’ inability to define how Libra fits into the U.S.’s regulatory mold exposes the perfunctory state of the U.S.’s approach to cryptocurrency and blockchain technology. Unlike other countries that are “ahead of the U.S. in providing regulatory clarity and guidance” for the sector, as McHenry put it, the U.S. could deter innovation with its sluggish — and at times, hostile — response to the industry.

“I , given the commentary we’ve heard today, we are discovering why a decision has been made to locate in Switzerland instead of the U.S.,” Representative Andy Barr teased during his time on the mic. 

Congressional members during both the Senate and House hearings were hard on Facebook for deciding to incorporate in the famous tax haven, though others, like McHenry and Barr, recognized that Switzerland has a favorable regulatory climate for fintech and crypto.

Satoshi willing, the topics discussed in yesterday’s hearing made crypto more concrete for U.S. lawmakers and laid a foundation to build a more suitable framework for crypto companies in the future. At the least, Libra got Congress talking about cryptocurrencies, and it seemed more receptive of Bitcoin than its corporate copycat.

“It is inevitable that the Bitcoin ecosystem will continue to move forward,” Demirors said during the panel. “The question is, where?” 

Following these hearings, Congress is now weighing this question more than ever — and whether or not it will lean into, or against, the trend.

The post Libra in Congress: A Chance to Define What Bitcoin Is and What Libra Isn’t appeared first on Bitcoin Magazine.

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Libra in Congress: A Chance to Define What Bitcoin Is and What Libra Isn’t

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What do you think would happen if the real Satoshi Nakamoto decided to reveal his identify tomorrow?

Just as a fun thought experiment. would happen in this world if Satoshi Nakamoto would reveal his identity starting tomorrow. How would everybody react you ? Lets assume that it is not a group but just one person that had created Bitcoin.

Edit: with bulletproof evidence Edit2: Nice answers but I also hoping for some ‘next level deep analysis’ answers 😛

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