Month: August 2022

Last week’s key crypto events

    James Bidman

Last week the stock market shed over 1.2 trillion dollars after fed chairman Jerome Powell made it clear that the central bank would continue aggressively raising interest rates to fight inflation during his speech at the annual Jackson Hole symposium.

Those of you who watched Jerome’s speech will know that it was abnormally short with Jerome getting straight to the point and specifying that the fed is prepared to cause a quote prolonged period of below trend growth to fight inflation. What’s even more terrifying is that Jerome admitted that the fed has no control over the supply side factors that are causing inflation and will therefore have to do excessive damage to the demand side of the equation to bring it down by raising interest rates.

Bringing demand down to bring it in line with supply as Jerome repeatedly stated on Friday would basically require another 2008 style financial crisis hence why the admission is so disturbing. To make things worse there are fears that the fed’s monetary policy won’t be enough to stop the inflationary forces of the fiscal policies that continue to be passed in the United States such as the recent student loan forgiveness program which arguably announced to another round of stimulus. If that wasn’t bad enough the fed is scheduled to accelerate its quantitative tightening come September which is literally later this week.

For context the last time the fed started reducing its balance sheet the stock market crashed by 20 percent in the months that followed. It’s not unreasonable to expect a similar situation this time around especially since a 20 decline would be consistent with the roughly 40 drop the crypto market needs to see to reach its bear market lows at least according to our calculations. Now even though the crypto market is likely headed lower in the medium term it’s quite possible that it will still see another recovery in the short term.

I say this because the scary shakeout we saw over the weekend was mostly due to leveraged traders getting liquidated. Now as painful as this was it wiped the crypto market clean of most of the speculation that’s been accumulating over the last couple of weeks and provided a more stable base from which the crypto market could move higher in the short term.

Week’s top headlines in the crypto news

    James Bidman

Here are this week’s top headlines in the crypto news.

Inflation expectations, the crypto market rallies on promising inflation statistics but comments by fed officials suggest it’s too soon to celebrate.

Ethereum advancements following another successful test. Net developers move up the date for the much anticipated merge. When could eth see the top of its current pop?

Tornado crash a privacy protocol on ethereum is sanctioned by the u. S department of the treasury causing d5 protocols to block associated wallets.

What does it mean for crypto? Blackrock is buying shortly after partnering with coinbase.

The world’s largest asset manager launches a private bitcoin product for its elite clients.

Why this is both bad and good news? cbdc’s coming to your country as citizens around the world lose confidence in their governments their central banks prepare to rush out their dystopian digital currencies.

What you’re about to read is educational content not financial advice.

 

The Best Bitcoin and Cryptocurrency-Lending Companies

    James Bidman

Bitcoin loans are becoming increasingly popular among crypto investors seeking for liquidity without having to sell their cryptocurrency.

As an alternative to selling your crypto, you may use it as collateral to acquire a house, start a company, or pay off high-interest debt. There may be tax advantages to borrowing crypto as well. A crypto or bitcoin secured loan does not result in a capital gains event, saving you the trouble of conducting your crypto taxes. Companies that provide cryptocurrency and bitcoin loans have emerged all over the world in order to meet this demand. This article identifies the top 10 cryptocurrency lenders.

BlockFi

BlockFi is a fintech firm based in New Jersey that provides crypto investors with services to allow them to make the most of their digital assets. With interest-earning accounts and low-cost USD loans backed by cryptocurrency, the firm serves customers all around the world, including 47 states in the United States. BlockFi has backing from firms such as Galaxy Digital, Susquehanna, Akuna Capital, Fidelity, Recruit Strategic Partners, Coinbase Ventures, CMT Digital, SoFi, ConsenSys Ventures, and Morgan Creek Digital.

To obtain a loan, you must either offer Bitcoin, Litecoin, or Ethereum as collateral. The firm now offers a maximum of a 50% LTV on your crypto loans.

To borrow $25,000, you’d need to put up roughly 10.06 Bitcoin as collateral (currently worth around $50,000). Interest rates begin at 4.5 percent and extend to 24 months for loans of this sort.

Unchained Capital

Unchained Capital is a crypto and bitcoin lending firm located in Austin, Texas. The business uses a three-step process to grant loans. They can give up to $1 million in cryptocurrency loans per day with the quick procedure.

Unchained has its own approach to loan custody and protection. They break the one-point-of-failure pattern of crypto custody by introducing a multi-signature system for storage.

The vault protects your assets in three key locations using three separate key holders. The collateral is secured by a contract, which is then kept in multi-signature addresses requiring two out of three keys to spend. You (the borrower), Unchained, and a third-party key custodian are the keepers of these keys. There is no single source of failure since no one individual or organization has such influence. This ingenious safety feature adds significant value for Unchained as a whole.

Salt Lending

Salt Lending is a firm based in Denver, Colorado, that provides Bitcoin and other crypto loans. According to its website, Salt Lending is the first blockchain-backed loan and offers loans in Bitcoin, Litecoin, and Ethereum with an LTV ratio of 50%.

The firm is growing its lending areas across the United States and to countries like Bermuda, Brazil, Hong Kong, Switzerland, the UAE, and Vietnam to provide individuals and firms with access to financial freedom via blockchain assets.

As an added bonus, Salts also gives you near-real time monitoring of your account and certain assurances that your assets will be there for you when you need them.

SpectroCoin

SpectroCoin is a crypto broker based in Lithuania that has been a top pick among European crypto brokerages since 2013. SpectroCoin recently introduced a crypto-backed loans program, with minimal requirements at just 25 EUR but maximum loan sizes ranging from 75,000 to 1 million EUR. Furthermore, SpectroCoin offers one of the lowest minimums on the market at only 25 EUR, as well as an option to provide loans with a market-leading 75 percent LTV ratio.

The company accepts bitcoin, ethereum, xem and dash as collateral. Clients may take out and repay loans in major cryptocurrencies such as bitcoin and euros.

Businesses may obtain a crypto-backed loan through Worldpay. In addition to crypto-backed lending, the firm provides a wallet, digital wallets, debit cards, and individual IBANs for clients.

Nexo

Nexo, a Swiss fintech firm with offices in the United States and Hong Kong, is one of the world’s major crypto lenders. When you deposit bitcoin and other cryptocurrencies into your Nexo wallet, you may get an instant line of credit.

The business offers loans in a number of cryptocurrencies, including Bitcoin, Ethereum, XRP (Ripple), Binance Coin, and Litecoin.

The process of obtaining a loan from Nexo consists of depositing cryptocurrency in a safe Nexo wallet, receiving immediate access to cash, and no credit checks are required. The wallet is completely insured and enables you to borrow in over 45 different fiat currencies across the world.

Apart from loans, Nexo provides interest-bearing accounts and other financial services based on your cryptocurrency. Today, the firm has already given more than $1 billion in crypto loans.

Crypto Tax Software

Are you using bitcoin and cryptocurrency loans to save money on taxes? Borrowing against bitcoin does not result in a taxable event. Receiving interest payments, on the other hand, does, and monitoring all of your cryptocurrency transactions may be difficult. By utilizing crypto tax software like CoinLedger, you can compute and report your tax obligation for crypto automatically.

CoinLedger is a cryptocurrency tax preparation software that has been used by tens of thousands of crypto enthusiasts to prepare their taxes. Simply submit your transaction history to the system, and it will create the corresponding crypto tax returns automatically. You can distribute these reports or upload them into popular tax filing programs like TurboTax or TaxAct.