Island Life
Good morning. To start the week off we've got the usual Monday morning market update, a check-in on Turkey, November CPI numbers, and some advice for your next move! Have a great week!
What this is:
A "Top 5" of crypto, digital asset, and other blockchain related news sent to your inbox on a daily basis
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Top 5:
1. Bitcoin Bounces Above $50K Amid Light Weekend Trading, Altcoins Kick Higher
On Sunday, bitcoin recovered it's $50K price level before dropping back below that number. The world's largest cryptocurrency is up from recent lows, but still down more than 25% from all-time highs reached in early November. Prices for other cryptocurrencies including ether rose on Sunday, before dropping later in the day, tracking a similar path as bitcoin. Trading volumes on centralized exchanges hovered around monthly lows, potentially indicating that any price recovery may be unsustainable.
Prices (as of Sunday 8:46pm ET):
Bitcoin: $49,021.10
Ether: $3,987.44
2. Tether, SHIB Compete With Bitcoin in Inflation-Ridden Turkey as Lira Tumbles
The Turkish lira's value continues to plummet and citizens are increasingly adopting altcoins and USD stablecoins as a store of value, rather than bitcoin. November trading volume on Binance totaled $918 million for the bitcoin-Turkish lira pair versus $5.26 billion for the shiba inu-lira pair and $5.58 billion for the tether-lira pair. Sabri Aygun, a textile professional in Istanbul, who also invests in cryptocurrencies, says that Turks "buy cheap crypto coins like SHIB, VET, XRP because BTC is expensive." Crypto payments are not allowed in Turkey, but holding crypto is legal for now, although it is possible that the Turkish government might step in to prevent capital from leaving the country via crypto channels.
3. Coinbase Launches DeFi Yield Product for Non-U.S. Customers
Users of Coinbase can now earn yield on their Dai stablecoin holdings as long as they are located outside the U.S. The new offering provides customers with the ability to deposit their Dai into Compound Finance, a DeFi interest rate protocol, in order to earn yield. During October, the annual percentage yield for Dai on Compound ranged from 2.83% to 5.39%. Coinbase attempted to launch a similar product, called Lend, in the U.S. earlier this year, but canceled the launch when the SEC threatened to sue the company.
4. US Inflation Jumps to 39-Year High of 6.8% in November; Bitcoin Falls
The CPI for all items rose 6.8% in the 12 months through November, the highest mark since March of 1982. Beginning this week, the Federal Reserve is expected to accelerate their rate of tapering in order to fight inflation, with the target of ending the pandemic-induced bond purchase program by March of 2022.
Inflation is at 6.8%, which means that a very large portion of US pension funds have achieved a negative real rate of return on their investment portfolio over the last 12 months.
— Pomp 🌪 (@APompliano) December 10, 2021
Do not count on your pension for retirement. Educate yourself on investing.
5. Crypto Rich are Moving to Puerto Rico, World's New Luxury Tax Haven
Crypto investors are flocking to Puerto Rico to take advantage of their friendly tax regime and the burgeoning crypto community. "Crypto Mondays" are popping up at restaurants, hotels, and local gathering spots across the island and crypto investment funds Pantera Capital and Redwood City Ventures already have offices located there. Under Puerto Rico's Individual Investors Act, new residents are exempted from paying capital gains taxes compared to the 20% rates (for wealthiest individuals) in the U.S. Additionally, companies approved for the Export Services Act are only subject to a 4% corporate tax rate along with a 100% exemption on dividends. According to Carlos Fontan, the Puerto Rican director of incentives at the Department of Economic Development and Commerce, the "doors are open" for the crypto community as long as they bring jobs with them.
Top Sharers of the Crypto Top 5:
1. Cameron S. - New York, NY
2. Jake Y. - Greenville, SC
3. Lauren A. - Nashville, TN
Disclaimer: The information contained in this newsletter shall not be understood or construed as financial advice. I am not an attorney, accountant or financial advisor, nor am I holding myself out to be, and the information provided is not a substitute for financial advice from a professional who is aware of the facts and circumstances of your individual situation.