The Wolf Den #648 - Ethical Investing And Crypto
In This Issue:
Ethical Investing And Crypto
Bitcoin Thoughts And Analysis
Altcoin Charts
Legacy Markets
A (Very) Basic Guide To Crypto Security
Bitcoin Vs. Ethereum Transactions In 2022
More Updates On SBF
Government Agencies Join Together For Crypto Warning
Indonesia To Launch National Crypto Exchange
Tokenizing Everything With Stephen Gregory, Currency.com
Sponsors
Ethical Investing And Crypto
Socially responsible investing, also known as ethical investing, is a growing trend in which investors seek to align their values with their investments while also striving for financial gain.
Good luck with that.
This active investment approach has forced the hand of companies to rethink strategies, comply with unique demands, and even create new funds that satisfy the ethics and morals of the socially responsible investors they aim to please. It’s an elaborate dance that has reshaped the landscape of traditional investing, and not necessarily for the better.
While the principles of ethical investing have been applied to the world of cryptocurrency, the application is not as straightforward as it is in traditional investing.
In the digital world, there are no tobacco companies, firearm manufacturers, or big pharmaceutical businesses to avoid. But there are still examples.
One prominent example of ethical considerations in the crypto market is the debate surrounding the energy usage of Bitcoin mining. The creation of the Bitcoin Mining Council is a positive development, showing a clear movement by the industry to clean up mining. That said, regulators and opportunists have taken advantage of the energy debate to criticize Bitcoin for their own purposes. Making financial decisions based on falsehoods about bitcoin mining is an example of ethical investing gone wrong.
Ethical dilemmas also arise with regard to other cryptocurrencies. Should Ethereum be de-platformed due to the presence of scams? Is Dogecoin's existence a distraction from crypto's potential for good? Should Tether's alleged shady past be held against platforms that list it? Do terms like "decentralization" and "blockchain" have any meaning beyond being marketing buzzwords?
These are all valid questions that require careful thought.
Ethical investing is hard to balance for crypto investors. If you are traveling this path, consider the following.
Freedom matters and investors have the right to align their money with their beliefs in any manner that they see fit. It's your money.
Further, if an investor believes that their investment will truly make a positive impact on the world, then this alone should trump all other concerns. Bitcoin mining and Ethereum's smart contracts might not be perfect, but the good aspects far outweigh the bad.
Additionally, it is important not to become too focused on the ethics of crypto investing and instead consider the bigger picture and the ways in which this technology has the potential to improve the world.
In 2023, let's strive to make socially responsible investing a tool for success rather than a hindrance.
God speed.
Bitcoin Thoughts And Analysis
WEEKLY CHART
I have shared this idea in the past, but it is worth revisting.
Weekly RSI has only hit oversold 3 times in history. The third time was this summer, which had led to significant bullish divergence with RSI coming out of oversold. There was a small bullish divergence (not shown), then a hidden bearish divergence (red, canceled first bullish divergence) and now a bigger bullish divergence (blue).
This is a weekly chart, so this can take months to play out. And price can drop much further and still maintain the divergence. Regardless, this is a "bottoming" signal that is quite clear.
Also, RSI has a clear descending black resistance, which it is once again testing. If we can see a close of RSI above this black line, price should eventually follow on the breakout.
Altcoin Charts
I do NOT share signals in this section. I share setups and charts that I am watching, in an effort to help show you how I view a chart and what criteria would be necessary for me to consider taking a trade. NEVER blindly buy something because it is listed in a newsletter or posted on twitter. You need to have a plan when you enter a trade. These are just ideas, and are almost always “if, then” scenarios. If a certain set of things happen, then I would consider a trade.
Rather than share a bunch of charts, I will share my stream from yesterday with Big Cheds. We went through about 11 different assets, sharing our individual views on each chart. This is a great way to learn.
Legacy Markets
Stocks increased and US futures rose as positive news from China and data from Europe increased risk appetite. The dollar decreased and Treasuries increased. All three major US gauges saw contracts rise and the Stoxx Europe 600 Index saw broad gains. Hong Kong shares increased as China considered additional support for property developers. Tesla rose after investor Cathie Wood increased her holding of shares in the company. Investors are looking for signs of cooling that will allow policymakers to slow the pace of interest rate increases. The Federal Reserve's meeting minutes and the jobs report are being closely watched by traders. Treasuries rose further and oil slumped due to a deteriorating demand outlook. The Australian dollar increased on reports that China may end its ban on Australian coal. The yen rose after the Bank of Japan announced further unscheduled bond buying.
Key events this week:
FOMC meeting minutes, Wednesday
US ISM manufacturing, JOLTS job openings, Wednesday
Eurozone PPI, Thursday
US ADP employment change, initial jobless claims, Thursday
China trade, Caixin PMI, Thursday
Eurozone retail sales, CPI, consumer confidence, Friday
Germany factory orders, Friday
US nonfarm payrolls, factory orders, durable goods, Friday
The main markets moves are:
Stocks
S&P 500 futures rose 0.4% as of 4:55 a.m. New York time
Nasdaq 100 futures rose 0.5%
Futures on the Dow Jones Industrial Average rose 0.3%
The Stoxx Europe 600 rose 0.9%
The MSCI World index fell 0.1%
Currencies
The Bloomberg Dollar Spot Index fell 0.7%
The euro rose 0.7% to $1.0619
The British pound rose 0.8% to $1.2063
The Japanese yen rose 0.5% to 130.35 per dollar
Cryptocurrencies
Bitcoin rose 1% to $16,836.13
Ether rose 3.2% to $1,249.39
Bonds
The yield on 10-year Treasuries declined four basis points to 3.70%
Germany’s 10-year yield declined eight basis points to 2.30%
Britain’s 10-year yield declined seven basis points to 3.59%
Commodities
West Texas Intermediate crude fell 1.8% to $75.58 a barrel
Gold futures rose 1.1% to $1,867 an ounce
A (Very) Basic Guide To Crypto Security
This is a good starting point for anyone looking to take basic steps to secure their crypto assets.
That's it, that's the post.
Bitcoin Vs. Ethereum Transactions In 2022
In 2022, Ethereum recorded 338% more transactions than Bitcoin, with a total of 405 million compared to Bitcoin's 93.1 million. It's worth noting that Ethereum's smaller block size and faster transaction speed contribute to this difference. However, it's important to consider the volume of each cryptocurrency over a 24-hour period. Currently, Bitcoin's 24-hour volume is approximately $14.2 billion, while Ethereum's is $3.5 billion - a 4x difference. It's likely that each cryptocurrency will continue to dominate in its own respective categories until there is a significant shift in the market.
More Updates On SBF
Are you sick of SBF?
I'm sick of SBF.
But we still need to track the story.
As expected, SBF has pleaded not guilty to the eight charges brought against him by the Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and the Southern District of New York (SDNY). It is likely that this plea will result in a future trial, during which prosecutors will present evidence to support their allegations of law violations.
In addition, the judge in the case has granted a request to seal the names of the individuals who co-signed SBF's $250 million bail bond. This means that the public will not have access to this information.
The law firm representing SBF said the following in a letter to the courts, “Mr. Bankman-Fried’s parents have become the target of intense media scrutiny, harassment, and threats and there is a serious cause for concern that the two additional sureties would face similar intrusions on their privacy as well as threats and harassment if their names appear unredacted on their bonds or their identities are otherwise publicly disclosed.”
Government Agencies Join Together For Crypto Warning
The US Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) have warned banks about the risks involved with cryptocurrency in a joint statement. The regulatory authorities cited significant volatility in the crypto markets, risk of fraud and scams, legal uncertainty surrounding the sector, lack of "maturity and robustness" in risk management and governance practices, and risk of contagion from the interconnectedness of crypto firms. The agencies also warned that decentralized systems are vulnerable to cyber attacks, outages and illicit finance. Banks are neither prohibited nor discouraged from providing services to any specific type of company, including crypto firms, but must manage the risks and follow relevant laws and regulations, the statement said.
Hard to argue with them at the moment.
Indonesia To Launch National Crypto Exchange
Indonesia plans to establish a national crypto exchange amid broader financial sector reform.
Indonesia plans to launch a national cryptocurrency exchange within the next year as part of financial sector reform. The country's Commodity Futures Trading Regulatory Agency (Bappebti) currently oversees the supervision of cryptocurrencies, but this will be transferred to the Financial Services Authority over the next two years. The national cryptocurrency exchange is expected to be in place by the time regulatory power over cryptocurrencies is transferred.
Tokenizing Everything With Stephen Gregory, Currency.com
I sat down with Stephen Gregory, US CEO of Currency.com, to discuss the challenges that crypto exchanges face in the US: the costs of the licenses, onboarding new clients, fixing the talent shortages with AI, and much more. You don’t wanna miss it.
In this episode with Stephen, we discussed:
Tokenization and regulation
Securing currency.com domain
Cost to get the license in the US
Navigating regulation
Tokenizing everything
How to attract new people
Currency.com and the crypto crash
Use of AI
Biggest challenges in crypto
Competition in crypto
Active trading
Crypto and sportsbetting
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.
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