A new week begins, and to help you plan your trading and investments in Bitcoin and other cryptocurrencies, here is a concise roundup of the most important developments from recent days:
Bitcoin’s outlook remains positive after last week’s rebound
True to form, Bitcoin (BTC) surprised markets and media last week when prices jumped more than 20% in 24 hours. BTC/USD had fallen to $9,688 earlier in the week, then surged to $11,525 on Wednesday and reached $12,025 on Thursday. Momentum eased by Friday, and support around $11,000 remained intact into Monday.
U.S. Congress calls for a moratorium on Facebook’s Libra stablecoin
Facebook faces increasing resistance as it pursues its Libra cryptocurrency. On Tuesday, the U.S. House Financial Services Committee urged the company to halt development of the project immediately. Lawmakers warned that Libra could create “an entirely new global financial system, headquartered in Switzerland and designed to compete with U.S. monetary policy” and argued it might have implications for national security, privacy, and global economic stability. The committee suggested a moratorium would allow time for legislative solutions and public hearings to assess Libra’s risks and benefits.
ECB urges swift regulatory action on Libra
The United States is not the only jurisdiction scrutinizing Libra. Benoît Cœuré, a member of the Executive Board of the European Central Bank, said regulators must act quickly to prepare for projects like Libra. Speaking in Aix-en-Provence, he argued that allowing new financial services and asset classes to develop in a regulatory vacuum would be irresponsible. According to Cœuré, the rapid growth of digital assets exposes gaps in existing financial regulation and highlights how slowly traditional banks adopt new technologies.
“All these projects are a useful wake-up call for regulators and public authorities,” he said, “encouraging us to raise a number of questions and potentially improve the way we operate.”
BIS chief softens stance on cryptocurrencies and backs central bank digital currencies
Last year, Agustín Carstens, head of the Bank for International Settlements (BIS), described cryptocurrencies as a “bubble, a Ponzi scheme and an environmental disaster.” Since then, the BIS has shifted its tone. In a recent Financial Times interview, Carstens expressed active support for the exploration and issuance of digital versions of fiat currencies. He said the BIS supports central banks pursuing such initiatives and suggested that a market for central bank digital currencies (CBDCs) could emerge sooner than many expect.
Pompliano is 75% confident Bitcoin will reach $100,000 by end of 2021
Anthony “Pomp” Pompliano, co-founder of crypto asset manager Morgan Creek Digital Assets, offered an optimistic forecast: he believes Bitcoin could reach $100,000 by the end of 2021, assigning the scenario roughly 75% probability. Pompliano points to the 2020 halving—when mining rewards will be reduced by half—as a major driver of future price appreciation. With trading volumes at record levels and growing recognition of Bitcoin as a store of value amid global uncertainty, he argues that “time is Bitcoin’s greatest ally.”
Bitcoin hash rate hits new all-time highs
The Bitcoin network’s hash rate reached a new all-time high on Sunday, July 7. Hash rate measures how many calculations the network’s mining equipment can perform each second. For miners, a higher hash rate increases the chances of solving the cryptographic puzzle, sealing a block, and earning the reward. A higher network hash rate also raises the resources required to launch a 51% attack, improving network security. This development is therefore a positive indicator for Bitcoin.