Fed’s latest report warns how high inflation and stablecoins can disrupt economy, Japan is bullish on XRP, and a house in Kentucky was purchased with Bitcoin. My name is Ben. This is your nightly crypto news wrap-up.
Let’s get it! Twice a year, the Fed releases a financial stability report that highlights what factors in play could actually pose a risk to the stability of our economy. It’s the first thing they actually timed well in a while, considering the report covers how high inflation and stablecoins could disrupt the financial system. You might already know that Terra LUNA’s stablecoin, UST, lost its peg. And although it recovered over 40% from its fall to 66¢, it’s still not back to a dollar. This happened because the recent interest rate hike of 50 basis points caused Bitcoin to rapidly fall.
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Consequently, the market panicked, and the sell-off caused UST to go below a dollar. The report points out that stablecoins are prone to runs, especially when high interest rates cause volatility. It also states stablecoins remain exposed to liquidity risks and that the assets backing the stablecoins could lose value and become illiquid. It should be noted that they didn’t directly point out UST in the report. They mentioned that Tether, USDC and Binance USDC make up more than 80% of the stablecoin market. But what the report warned did in fact happen to UST. This is just a report, and nothing is set in stone, but if you want insight on what the Fed is thinking, in the report, a few pages underneath their concerns with stablecoins, there’s an entire section with the header “Central Bank Digital Currency and Financial Stability”.
Let’s hope that stablecoins remain stable. But for a deeper look into volatile assets, let’s pass it off to Frankie Candles for a market watch. Thanks, Ben! Alright, guys. Let’s go ahead and do a little market watch. We’ve got Bitcoin coming in at $30,955. Up about 1% on the day Still down about 18% on the week Ethereum coming in at $2,338 Up about 3% for the day Let’s go ahead and check our top losers here. LUNA down 54% on the day, 80% on the week Absolutely insane! GMT down 15%, almost 16% Down 44% on the week, guys And TerraUSD, I’m sure you guys know about this whole debacle, down 8% on the day 21% on the week Not every day you see a stablecoin on the top losers like that, down 8% on the day, guys. But as you know, we have been dumping. I do think we will get a bounce at some point. I don’t know if we’re just there yet. I think we might have a tiny bit more room left to come down before we finally get a big bounce. But, guys, nothing goes down in a straight line. A relief bounce is imminent at some point. The question is, when will that be?
Japanese used car firm SBI Motor Japan is giving their customers the green light to pay for their vehicles using Bitcoin and XRP? zycrypto.com points out, “This marks the very first time the XRP coin has been integrated into a cross-border e-commerce site in Japan.” This story is the perfect example of everything I’ve been talking about for the past few months.
Remember these words: long-term mindset Regardless of bearish price action, crypto remains to be globally adopted, not just out of convenience but out of necessity. SBI Motors points out that 1.7 billion adults across the globe are unbanked. They see the writing on the wall, and they’re front running the technology in the Japanese car sales market. Bravo to them! Listen, crypto is filling a gap that banks are unable to fill and the demand for cryptocurrencies to ripple across the oceans. Pun intended. This story shows that no matter how long dirty Gary Gensler delays his demise, the SEC case is not stopping the global market from adopting XRP. No matter how bloody this bear market gets, stories like this show that crypto is a train that cannot be stopped. Better get on it now because the rest of the world will be aboard in the next 10 years. Just like how crypto is being used to pay taxes across the globe and to buy cars in Japan, now, crypto is being used to buy real estate in America. In Louisville, Kentucky, the state’s largest city, a two-bedroom house was purchased for roughly one Bitcoin.
According to finbold.com, the purchase took only about eight seconds to complete and cost 70¢ in transaction costs to process. To no surprise, using crypto to purchase houses could be becoming a trend. Just a few days ago, a house in Portugal was purchased for three Bitcoin, and the Colorado Newsline just ran a story titled “Is Colorado’s housing market ready for crypto transactions?” Satisfied buyer of the Kentucky property gladly stated, “I’m happy that I can help try and bring this technology to the future. There’s so many uses for Bitcoin, and I think we’re at the very, very early stages of it. It’ll be interesting to see where it goes.” I couldn’t have said it better myself. We are very early indeed.
This article is a transcription of a video made by BitBoy Crypto
Original video: https://youtu.be/Uea2CCGUbWQ
