Weekly Newsletter[Block#836,188]
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A. Bitcoin Ecosystem
1. World’s largest pension fund seeks information on bitcoin under portfolio diversification plan
2. Michael Saylor’s MicroStrategy acquired another 9,245 BTC for $623M
3. Riot’s $640m megadeal stumbles as Texas sour on industry’s promise of jobs and growth
4. Bitcoin demand in Argentina reaches highest point in nearly 2 years
B. Regulation
1. EU committees approve ban on anonymous crypto transactions via hosted wallets
2. SEC’s Gensler says crypto firms skip public disclosures by dodging registration
C. Macroeconomy
1. Fed leaves interest rates unchanged but signals three cuts this year
2. Eurozone productivity drops
D. Bitcoin Tech Development
1. BIP324 proxy for light clients
2. Notable code and documentation changes
A. Bitcoin Ecosystem
1. World’s largest pension fund seeks information on bitcoin under portfolio diversification plan
Japan’s state pension fund, the world’s largest pension fund by assets under management on several different rankings, is seeking information on bitcoin as it considers options for portfolio diversification in response to changes in society, the economy and technology. The Government Pension Investment Fund (GPIF), which has $1.4 trillion in assets under management, requested data on potential investment diversification tools such as bitcoin and precious metals like gold, which the company considers illiquid and does not currently hold, it said Tuesday. For the time being, GPIF invests in domestic bonds, domestic stocks, foreign bonds, foreign stocks, private equity, real estate and infrastructure. The fund is seeking basic information, including academic studies, analytical tools and indexes “including investment examples, investment philosophy, how to incorporate into the portfolio of pension funds,” it said.
2. Michael Saylor’s MicroStrategy acquired another 9,245 BTC for $623M
MicroStrategy ($MSTR), software firm and bitcoin development company, has purchased another 9,245 bitcoins for $623 million or about $67,400 per bitcoin, according to a filing on Tuesday. Led by Executive Chairman Michael Saylor, the company acquired its latest BTC using $592.3 million raised from its most recent convertible notes offering plus $30.7 million of excess cash. MicroStrategy now holds approximately 214,246 BTC, which is more than 1% of all the 21 million bitcoin that will ever exist. It has paid approximately $7.53 billion for its BTC, an average of $35,160 per bitcoin, according to the filing.
3. Riot’s $640m megadeal stumbles as Texas sour on industry’s promise of jobs and growth
The Navarro County Commissioners declined to approve a reinvestment zone for Riot Platforms’ newest operation, which would be the largest Bitcoin mining facility in Texas. The commissioner’s office received a slew of emails, text messages and even personal visits from residents opposing the deal, Navarro County Commissioner David Brewer said. None of the commissioners saw fit to move ahead with Riot Platforms’ request. Brewer said. “I think that they created a lot of controversy out there.” While Riot Platforms can try again, the decision was striking in a state where municipalities, with an eye on jobs and economic growth, have rolled out the welcome mat for Bitcoin mining outfits in recent years. “Even though Texas is number one in Bitcoin mining, they have only created 2,000 permanent full-time jobs in all of Texas,” said Jackie Sawicky, founder of the Texas Coalition Against Bitcoin Mining.
4. Bitcoin demand in Argentina reaches highest point in nearly 2 years
Argentines’ efforts to preserve their savings amid the ongoing decline of their national currency, the Argentine peso, has resulted in the nation recently hitting its highest demand for Bitcoin in 20 months, according to a recent report. On March 20, Bloomberg reported data sourced from cryptocurrency exchange Lemon Cash revealing that nearly 35,000 customers in Argentina purchased Bitcoin in the week ending March 10, double the weekly average compared to 2023. A major factor for the increase in demand is the ongoing decline of the nation’s currency. Over the past twelve months, the peso’s value against the United States dollar has plummeted, dropping from $0.0049/peso in March 2023 to $0.0012/peso. However, it was noted that Lemon wasn’t the only platform seeing a surge in demand. Other major exchanges in Argentina, such as Ripio and Belo, reported similar trends.
Reference:
https://cointelegraph.com/news/bitcoin-demand-argentina-reaches-peak-argentine-peso
B. Regulation
1. EU committees approve ban on anonymous crypto transactions via hosted wallets
A majority of the European Parliament’s lead committees have approved a ban on cryptocurrency transactions of any value made through hosted crypto wallets. This comes amid the European Council and parliament provisionally agreeing to expand parts of the European Union’s Anti-Money Laundering (AML) and Counter-Terrorist Financing laws to cover the cryptocurrency market. According to an X post by Patrick Breyer, a member of the European Parliament for the Piratenpartei Deutschland (Pirate Party of Germany), a “majority of the EU Parliament’s lead committees” approved the new AML laws on March 19. The ban applies specifically to hosted or custodial crypto wallets offered by third-party service providers, such as centralized exchanges.
2. SEC’s Gensler says crypto firms skip public disclosures by dodging registration
U.S. Securities and Exchange Commission Chairman Gary Gensler used a speech on the “public good” of securities disclosures on Friday to point specifically at the crypto industry as a problem area. Gensler, whose tenure atop the agency has been marked by a legal crusade against what he argues is a largely noncompliant industry, suggested that digital assets businesses are among those seeking to “whittle away at the SEC’s disclosure regime,” which requires companies to register securities and provide information to investors about them. “There are participants in crypto securities markets that seek to avoid these registration requirements,” he said in remarks prepared for an event at Columbia Law School. “No registration means no mandatory disclosure.” “Many would agree that the crypto markets could use a little disinfectant,” Gensler added.
Reference:
https://finance.yahoo.com/news/secs-gensler-says-crypto-firms-161500344.html
C. Macroeconomy
1. Fed leaves interest rates unchanged but signals three cuts this year
The Federal Reserve announced on Wednesday that it would leave US interest rates at a 25-year high as it continues to assess their impact on cooling inflation and the wider economy. After a two-day meeting, the Fed announced rates would be unchanged at 5.25% to 5.5%, where they have been since July. But the Fed signaled it still expects to cut rates three times this year. The Fed chair, Jerome Powell, has indicated that the central bank may soon start cutting rates following a series of hikes aimed at tackling a generational surge in prices triggered by the Covid pandemic. “Recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have remained strong, and the unemployment rate has remained low. Inflation has eased over the past year but remains elevated,” the Fed said in a statement. Economists had predicted the Fed would cut rates three times this year, but doubts remain, as recent economic data suggests that the pace of decline in the rate of inflation is slowing and, at 3.2%, remains above the Fed’s 2% target. “The committee wants to see more data that gives us higher confidence that inflation is moving down sustainably toward 2%,” Powell said. “We don’t see this in the data right now.”
Reference:
https://www.theguardian.com/business/2024/mar/20/federal-reserve-interest-rates
2. Eurozone productivity drops
For the first time since the global financial crisis in 2008–2010, productivity in the Eurozone (output per hours worked) has been steadily declining. Specifically, in each of the most recent six quarters, productivity fell from a year earlier, with productivity down 1.2% in the fourth quarter of 2023 versus a year earlier. Absent productivity growth makes it impossible to generate strong per capita economic growth (and rising living standards). In addition, when productivity falls, it leads to an increase in unit labor costs (the labor cost of producing a unit of output). From the perspective of the European Central Bank (ECB), a lack of productivity growth makes it that much harder to reduce inflation at a time when wages are rising. Productivity gains would offset wage gains, enabling companies to pay higher wages without raising prices.
Reference:
https://www2.deloitte.com/us/en/insights/economy/global-economic-outlook/weekly-update.html
D. Bitcoin Tech Development
1. BIP324 proxy for light clients
Sebastian Falbesoner posted to Delving Bitcoin to announce a TCP proxy for translating between the version 1 (v1) Bitcoin P2P protocol and the v2 protocol defined in BIP324. This is especially intended to allow light client wallets written for v1 to take advantage of v2’s traffic encryption. Light clients typically only announce transactions belonging to their own wallets, so anyone capable of eavesdropping on an unencrypted v1 connection can reasonably conclude that a transaction sent by a light client belonged to someone using the origin IP address. When v2 encryption is used, only the full nodes receiving the transaction will be able to definitively identify it as originating from the light client’s IP address, assuming none of the light client connections is subject to a man-in-the-middle attack.
2. Notable code and documentation changes
Bitcoin Core #27375 adds support to the -proxy and -onion features for using Unix domain sockets rather than local TCP ports. Sockets can be faster than TCP ports and offer different security tradeoffs.
Bitcoin Core #27114 allows adding “in” and “out” to the whitelist configuration parameter to give special access to particular incoming and outgoing connections. By default, a peer listed in the whitelist will only receive special access when it connects to the user’s local node (an incoming connection). By specifying “out”, the user can now ensure a peer receives special access if the local node connects to it, such as by the user calling the addnode RPC.
Bitcoin Core #29306 adds sibling eviction for transactions descended from an unconfirmed v3 parent. This can provide a satisfactory alternative to CPFP carve-out, which is currently used by LN anchor outputs. V3 transaction relay, including sibling eviction, is not currently enabled for mainnet.
