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Hong Kong Introduces Personal e-CNY Wallets for Residents
Users in Hong Kong can now set up personal e-CNY wallets for cross-border payments between Hong Kong and Mainland China. This initiative, announced by the Hong Kong Monetary Authority (HKMA), aims to broaden the usage of China’s central bank digital currency among Hong Kong residents. The e-CNY wallets, which can be set up using Hong Kong mobile phone numbers, will facilitate cross-border payments but will not support person-to-person transfers within Hong Kong. The wallets can be topped up via the Faster Payment System through 17 retail banks in the city. This development is part of HKMA's "three connection, three facilitation" initiative to strengthen financial ties with Mainland China. Meanwhile, Hong Kong is progressing with its own central bank digital currency (CBDC) pilot, the e-HKD, and has launched a regulatory sandbox for stablecoins.
Chainlink Surges by 18% Following Wall Street Pilot with JP Morgan, BNY Mellon, and DTCC
DTCC recently wrapped up a tokenization pilot with JP Morgan and BNY Mellon using Chainlink's CCIP, leading to an 18.8% surge in Chainlink's LINK token value. The pilot, named Smart NAV, aimed to make mutual fund data available on public networks via Chainlink's cross-chain interoperability protocol. This success signals Wall Street's growing interest in blockchain technology for asset tokenization and data dissemination, moving towards more automated and real-time processes.
Rising Dominance of Big Miners Poses Existential Threat to Bitcoin
The Bitcoin mining landscape is becoming increasingly centralized, with AntPool and Foundry USA controlling over 50% of Bitcoin's hash rate. This concentration of power among mining pools raises concerns about potential censorship and double-spending risks. Recently, F2Pool, a prominent mining pool, censored transactions from OFAC-sanctioned addresses, highlighting the potential for abuse of power. The community's response includes encouraging node operators to run independent nodes and ASIC owners to avoid pointing their rigs to the largest pools, promoting decentralization as a safeguard against malicious actions.
Trading Desk Insights
Bitcoin surged past $66,000 early Friday, recovering from Thursday's dip below $65,000. The price started to retreat precisely at our resistance target of $67,500. As long as Bitcoin remains above its 50-day moving average, we anticipate continued upward momentum. Notably, this week has seen significant institutional interest, with major players disclosing substantial BTC ETF holdings. For instance, Morgan Stanley reported a $269.9 million investment in Grayscale's GBTC yesterday.
In the US BTC ETFs market, inflows totaled $257.3 million, spearheaded by BlackRock, which accounted for $93.7 million of that amount.
While Ethereum (ETH) has underperformed compared to other major digital assets this year, it holds potential for an upside surprise. Staking and layer 2 growth have been significant, and ETH's central role in DeFi is secure due to the widespread adoption of the EVM and its layer 2 innovations.
The "hodler net position change," which measures the net buying/selling activity of addresses holding coins for six months or more, has turned positive for the first time since December, indicating that long-term holders are now net buyers.
Equities are poised for a strong end to the week, with the S&P 500 up 1.5% and the Nasdaq gaining 2.3%. Both indexes are on track for their fourth consecutive winning week, a streak not seen since February. Additionally, China has announced a $42 billion package of measures to support its struggling property sector.
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Disclaimer
This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. The price of crypto assets may rise or fall because of changes in the broad market or changes in a company's financial condition, sometimes rapidly or unpredictably. Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur. Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments. We and our affiliates, officers, directors, and employees, excluding equity and credit analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives, if any, referred to in this research.
The information on which the analysis is based has been obtained from sources believed to be reliable such as, for example, the company’s financial statements filed with a regulator, company website, company white paper, pitchbook and any other sources. While Secure Digital Markets has obtained data, statistics, and information from sources it believes to be reliable, it does not perform an audit or seek independent verification of any of the data, statistics, and information it receives.
Unless otherwise provided in a separate agreement, Secure Digital Markets does not represent that the report contents meet all of the presentation and/or disclosure standards applicable in the jurisdiction the recipient is located. Secure Digital Markets and their officers, directors and employees shall not be responsible or liable for any trading decisions, damages or other losses resulting from, or related to, the information, data, analyses, or opinions within the report.
Crypto and/or digital currencies involve substantial risk, are speculative in nature and may not perform as expected. Many digital currency platforms are not subject to regulatory supervision, unlike regulated exchanges. Some platforms may commingle customer assets in shared accounts and provide inadequate custody, which may affect whether or how investors can withdraw their currency and/or subject them to money laundering. Digital currencies may be vulnerable to hacks and cyber fraud as well as significant volatility and price swings.
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