Daily Bit #183: XRP & ETFs
Industry Updates
- The Houston Rockets have a new sponsor for the upcoming NBA season… crypto mining giant, AntPool.
- Venezuelan President Maduro plans on using the Petro for international trade starting in October.
- New rulings from California have banned political candidates from accepting Bitcoin as campaign contributions.
- Binance listed a third stablecoin, Paxos Standard Token (PAX).
Top Story
XRP & ETFs
What’s more disappointing: being a fan of the team that served the Cleveland Browns their first win since 2016 or watching $XRP jet up (smh) ~75%+ in the past week without having a position?
I’m taking the latter. Not to drift too far off topic, but I fell asleep halfway through the 4th quarter, so I didn’t experience the Jets’ L in real time. Plus those beer fridges throughout the city of Cleveland were finally unchained, which made for tremendous headlines, and JR Smith unsurprisingly took his shirt off in celebration. Ahhhhhh, football. Nothing like it.
And if the snapping of Cleveland’s dry spell didn’t already get the people going, yet another “alt season” is taking shape in the broader crypto markets. That began unfolding yesterday afternoon as total market cap broke above $200B in the early morning and has climbed another ~$20B over the past 24 hours.
Coincidentally, the rally matches up with $XRP’s uptick yesterday morning… which makes perfect sense. Being the third largest crypto asset by market cap, XRP’s ~50% gains (bananas) in the past 24 hours should expectedly be the catalyst behind the market’s rise.
Plus, with $ETH sitting barely $2B ahead of $XRP in total cap, folks are now clamoring about whether there will be a “flippening” between the two. And given that Ethereum historically led most alt cycles, one can ponder whether that perk would transfer to XRP if $ETH loses its #2 spot.
As for what caused XRP’s growth? A number of banking partnerships have been announced, and it’s rumored that Ripple’s xRapid product will be releasedwithin the next month.
Then there’s the upcoming Swell Conference from October 1–2 in SF where former President Bill Clinton will serve as the keynote speaker. In a market that buys the rumor…. that’s a heap of hype. Not to mention the mass of retail investors that are regularly advised to purchase $XRP by online supporters… despite the fact that it’s intended to be a product used by banks ¯\_(ツ)_/¯.
But, enough of that — let’s talk Bitcoin ETFs.
Those of you who monitor the market beyond the scope of daily email newsletters are likely aware that the SEC delayed their decision on the VanEck/SolidX Bitcoin ETF.
In short, the new deadline for a decision is December 29th. Jake Chervinsky, aka #CryptoTwitter’s lawyer (but not really) has a stellar FAQ on all things ETF related here.
As for what that means for the industry? To be perfectly candid, it shouldn’t mean much — little has changed since last time.
We know what the deal is. Crypto is/needs:
- Unregulated
- Prone to manipulation
- More oversight
- Larger markets
….among other things before an ETF won’t put a sour taste in the SEC’s mouth. Yet people still look at an ETF, and more recently, Bakkt, as the industry’s saving grace.
While there’s no denying the fact that additional investment vehicles make the industry more accessible for institutional investors… let’s set the matter straight. It doesn’t matter how many ETFs, ETNs, NDFs, or whatever 3-letter acronym product people create for the industry if the projects that they track are hot garbage.
Or, more appropriately, not mature enough in their development in regards to liquidity, oversight, and other regulatory demands to warrant the construction of new investment vehicles.
Fintech Frank touched on this yesterday:
Personally, I think that most people are pushing for an ETF because they want to get rich quick. Not because they believe in the technology, not because they want to expand the ecosystem, but because they hold unwavering conviction that an ETF approval will make them better off.
Which is fine — people are entitled to their opinions. But that just creates more smoke & mirrors at the end of the day and that doesn’t do the ecosystem any good.
I’ll sign off with a quote from Naval that meshes well with Frank’s tweet. For those interested, the original clip (45 seconds, nothing major) can be found here.
“The world is very efficient. So the people who succeed are the ones who are irrationally passionate about something. They’re not doing it for the money. So you just have to be patient. This is the problem. It takes 10 years to build a career in anything. It takes 10 years minimum to raise a child. It takes 10 years minimum to build a business. It takes 10 years minimum to build a career.”
Most companies in the industry were started within the last 1–3 years. By Naval’s count, there’s at least ~7 years left of waiting. So, wait. It pays.
Brain Fuel
- 13 min read: Solving the Decentralized Credit Problem (Andrew Young)
- 15 min read: Introducing a Crypto Benchmark Framework (Vision Hill Advisors)
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