The Wolf Den #105 - Central Bank Digital Currencies Are Coming
thewolfden.substack.com
This newsletter is sponsored by PHEMEX, the only exchange that I use to trade crypto with leverage. Sign up with the link above and get some free Bitcoin. I really encourage you to check them out - you know that I never endorse a product that I do not use!Note: I have moved the charts back to the top of the newsletter. I have had a number of complaints about them being at the bottom and gmail truncating the emails. You can always click the link gmail provides to read the entire email.It isn’t a secret that CBDCs - Central Bank Digital Currencies - are all the talk within regulatory circles and beyond. Yesterday morning, Jerome Powell said that over 80% of national banks are exploring CBDCs, with some going as far as to pilot projects and begin implementation. This statement, and others coming from the Fed Chairman, were from a panel called the Future of Cross Border Payments in which he was joined by other major international regulators. This is my take on Powell’s remarks about CBDCs.Powell, the star of the show, was the first to be given the floor to share insights into the FED's current position on CBDCs. Eager listeners were given little insight into any new developments. It seems the U.S. remains in the same spot it has been since the advent of CBDCs – on the sidelines. But an interesting strategy could be emerging, which will be addressed below the highlighted statements. Below are Powell’s most important remarks (take note of the underlined quotes)."We have been actively participating with other central banks learning about CBDC's.”“The FED is also exploring and learning from the private sector.”“The FED needs to make sure the CBDC will be an improvement to our current system.“A CBDC would be a complement to our dollar."“We have an obligation to stay at the forefront, which includes the CBDC, but it is more important for the U.S. to be right, than first.” “We are committed to the strength of our dollar and still have more questions and research to go through.”After careful consideration and observation, I believe that the FED is simply choosing to not be first in implementing a CBDC, even if they have the means to do so. Here’s why - Powell stressed multiple times that the FED needs more time to better understand the role a U.S. CBDC could play. What he probably means is that the U.S. wishes to see another country successfully implement a CBDC first. There is already an abundance of information readily available about CBDCs in early pilot phases, but a complete lack of mainstream success. It was even announced in the meeting that the General Manager from the Bank of International Settlements is connecting countries so they can learn from each other in this process. Information is abundant and available, yet the U.S. is standing still. Why be first when you can let someone else take all of the risk?As the FED has said many times over, it will continue to do everything in its power to retain the U.S. dollar as the reserve currency of the world. A late implementation of a digital dollar won’t undermine this status. It is still very much the case that the U.S. is behind in innovation, but there have been enough instances now of regulators that know enough about blockchain, cryptocurrencies, and CBDCs to begin a pilot phase. They are simply choosing not to start. Most likely, the truth of CBDC implementation lies somewhere between the U.S. lagging behind and a developing strategy to learn from the mistakes of others. As more and more top U.S. financial regulators continue to improve their understanding, it will prove the theory that strategy is the driving force, rather than ignorance in the race for CBDC development. I believe this will be a net positive for the U.S., but only time will tell.IMPORTANT UPDATE, PLEASE READ!To add value for you guys, I have decided to try livestreaming your chart requests! As you know, I accept requests on Wednesdays from 8 AM to 1 PM EST - you can reply to this email with requests. I take one request per person, per week. We did this last week and it was very well received! I think this offers far more insight into how I view a chart and the market.HERE IS THE YOUTUBE LINK FOR TOMORROW!https://youtu.be/NzPrKAVA-b4In This Issue:Bitcoin Thoughts And AnalysisIntoTheBlock - Despite 98% Support Uniswap’s First Governance Vote FailsAltcoin ChartsLegacy MarketsSupply And Demand TradingFiscal Policy 101CBDCs - What Are The Implications?FinCEN Fines First Cryptocurrency Mixing ServicePhemex Trading CompetitionThe Wolf Of All Streets Podcast Ft. Brock PierceMy Recommended Platforms And Tools
The Wolf Den #105 - Central Bank Digital Currencies Are Coming
The Wolf Den #105 - Central Bank Digital…
The Wolf Den #105 - Central Bank Digital Currencies Are Coming
This newsletter is sponsored by PHEMEX, the only exchange that I use to trade crypto with leverage. Sign up with the link above and get some free Bitcoin. I really encourage you to check them out - you know that I never endorse a product that I do not use!Note: I have moved the charts back to the top of the newsletter. I have had a number of complaints about them being at the bottom and gmail truncating the emails. You can always click the link gmail provides to read the entire email.It isn’t a secret that CBDCs - Central Bank Digital Currencies - are all the talk within regulatory circles and beyond. Yesterday morning, Jerome Powell said that over 80% of national banks are exploring CBDCs, with some going as far as to pilot projects and begin implementation. This statement, and others coming from the Fed Chairman, were from a panel called the Future of Cross Border Payments in which he was joined by other major international regulators. This is my take on Powell’s remarks about CBDCs.Powell, the star of the show, was the first to be given the floor to share insights into the FED's current position on CBDCs. Eager listeners were given little insight into any new developments. It seems the U.S. remains in the same spot it has been since the advent of CBDCs – on the sidelines. But an interesting strategy could be emerging, which will be addressed below the highlighted statements. Below are Powell’s most important remarks (take note of the underlined quotes)."We have been actively participating with other central banks learning about CBDC's.”“The FED is also exploring and learning from the private sector.”“The FED needs to make sure the CBDC will be an improvement to our current system.“A CBDC would be a complement to our dollar."“We have an obligation to stay at the forefront, which includes the CBDC, but it is more important for the U.S. to be right, than first.” “We are committed to the strength of our dollar and still have more questions and research to go through.”After careful consideration and observation, I believe that the FED is simply choosing to not be first in implementing a CBDC, even if they have the means to do so. Here’s why - Powell stressed multiple times that the FED needs more time to better understand the role a U.S. CBDC could play. What he probably means is that the U.S. wishes to see another country successfully implement a CBDC first. There is already an abundance of information readily available about CBDCs in early pilot phases, but a complete lack of mainstream success. It was even announced in the meeting that the General Manager from the Bank of International Settlements is connecting countries so they can learn from each other in this process. Information is abundant and available, yet the U.S. is standing still. Why be first when you can let someone else take all of the risk?As the FED has said many times over, it will continue to do everything in its power to retain the U.S. dollar as the reserve currency of the world. A late implementation of a digital dollar won’t undermine this status. It is still very much the case that the U.S. is behind in innovation, but there have been enough instances now of regulators that know enough about blockchain, cryptocurrencies, and CBDCs to begin a pilot phase. They are simply choosing not to start. Most likely, the truth of CBDC implementation lies somewhere between the U.S. lagging behind and a developing strategy to learn from the mistakes of others. As more and more top U.S. financial regulators continue to improve their understanding, it will prove the theory that strategy is the driving force, rather than ignorance in the race for CBDC development. I believe this will be a net positive for the U.S., but only time will tell.IMPORTANT UPDATE, PLEASE READ!To add value for you guys, I have decided to try livestreaming your chart requests! As you know, I accept requests on Wednesdays from 8 AM to 1 PM EST - you can reply to this email with requests. I take one request per person, per week. We did this last week and it was very well received! I think this offers far more insight into how I view a chart and the market.HERE IS THE YOUTUBE LINK FOR TOMORROW!https://youtu.be/NzPrKAVA-b4In This Issue:Bitcoin Thoughts And AnalysisIntoTheBlock - Despite 98% Support Uniswap’s First Governance Vote FailsAltcoin ChartsLegacy MarketsSupply And Demand TradingFiscal Policy 101CBDCs - What Are The Implications?FinCEN Fines First Cryptocurrency Mixing ServicePhemex Trading CompetitionThe Wolf Of All Streets Podcast Ft. Brock PierceMy Recommended Platforms And Tools