The Weekly Pen: Market Avengement & Adventures

Week 7 is here, and "person" is a lucky one. Bitcoin went through a rally bringing the total crypto market above the trillion-dollar mark, justice being served and advantageous adventures being ventured. The Pen team is back with the weekly wrap-up of all things global financial markets and economy, concerning crypto, finance, investing, interest rates and those sort of stuff. Have a good read from yours truly with this week weekly.

JPMORGAN TOKENIZED#

JPMorgan has issued a research note suggesting that "deposit tokens" have the potential to be a promising new financial technology. Deposit tokens are digital representations of bank deposits that can be traded on blockchain platforms, providing greater flexibility and liquidity for depositors. The tokens could offer banks new funding sources and revenue streams, but their regulatory environment is unclear, and the technology is still in its early stages.

COINBASE HITS BACK#

Coinbase is resisting the U.S. SEC's claim that its "staking as a service" product is a security that needs registration with the agency. Coinbase argues that its product is not a security and has received no clear guidance on how to proceed. The SEC's stance could impact the way other companies offer staking services in the cryptocurrency industry. Coinbase is ready to defend its position in court.

BINANCE PAYING PENALTIES#

Binance is reportedly in talks with the U.S. Commodity Futures Trading Commission (CFTC) regarding potential penalties to resolve investigations into its business practices. Binance is facing scrutiny from regulators around the world for issues related to anti-money laundering procedures and customer protection. Binance CEO, Changpeng Zhao, has stated that the company is committed to compliance and is working to improve its regulatory posture.

WALLSTREET BETS BITING BACK#

The founder of WallStreetBets, a popular subreddit dedicated to stock trading, is suing Reddit over alleged securities fraud. The lawsuit claims that Reddit's executives manipulated the stock market by allowing and promoting the subreddit's users to engage in illegal trading practices. The lawsuit seeks class-action status and damages of over $500 million. Reddit has denied the allegations, stating that it "did not coordinate" the trading activity on WallStreetBets.

RETAIL INVESTORS BACK WITH AN APPETITE#

Retail investors poured record amounts of money into the US stock market in January. Retail investors were responsible for over $27 billion in inflows, while institutional investors saw outflows of around $11 billion. This trend is attributed to the recent surge in popular trading apps and the continuing impact of the Covid-19 pandemic on people's financial behavior. This trend is likely to continue as the economy recovers and interest rates remain low.

BAO FAN GONE MIA#

Bao Fan, the CEO of China Renaissance, a Chinese investment bank, has gone missing. Bao has been incommunicado since February 9, and the company has been unable to contact him or obtain information about his whereabouts. The company's shares have fallen since the news of Bao's disappearance, and there is speculation that the incident may be related to a government crackdown on financial irregularities in the country.

PORTUGAL PROTECTING ITS OWN SUN#

Portugal will end its "golden visa" program, which offers residency permits to non-European Union citizens who invest in the country, in 2023. The decision comes after concerns that the program has contributed to a surge in property prices, particularly in Lisbon and Porto, which has made it difficult for locals to afford to house. The golden visa program has been criticized for allowing wealthy individuals to buy their way into Europe without any substantial economic benefit to the country. Portugal's decision follows similar moves by other European countries, including Spain and Greece, to tighten their residency programs.

ELON MUSK XMAS PRESENT#

Tesla CEO Elon Musk donated about $2 billion worth of Tesla stock to his own charity foundation, according to a recent filing with the U.S. Securities and Exchange Commission. The donations were made in the form of stock options, and Musk did not provide any additional information on the donations or the charity. Musk has previously stated that he plans to donate most of his wealth to philanthropy, particularly in the areas of sustainable energy and space exploration. However, some have criticized Musk for directing his donations to his own foundation rather than established charities.

SEC SHAME SBF#

A judge warned cryptocurrency entrepreneur SBF, that he could face jail time if he continues to use encrypted communications in his legal battle with the U.S. SEC. The SEC ordered SBF to decrypt his communications for the investigation, but SBF refused, citing privacy and security concerns. The judge has threatened to hold SBF in contempt of court if he continues to resist.

GOLDMAN SACHS TOKENIZING#

The Hong Kong Monetary Authority (HKMA) has issued a $100 million tokenized green bond on its blockchain platform eTradeConnect, in collaboration with HSBC and Standard Chartered. The bond is the first of its kind in Hong Kong and attracted interest from a range of institutional investors. It is part of Hong Kong's efforts to promote sustainable finance and to position itself as a leading center for green finance.

GETTING HIGH ON HIS OWN SUPPLY#

A man in the U.S. has been sentenced to 10 years in prison for running a Ponzi scheme that promised high returns to investors who put money into his cattle and marijuana businesses. The man was accused of stealing more than $30 million from over 600 investors in the scheme. The court found that he used the money to fund his own lavish lifestyle, including buying cars and jewelry and making payments to earlier investors to give the illusion of legitimate returns. The man was also ordered to pay restitution to his victims.

INVESTORS POURING SUMS#

Investors are pouring record amounts of money into high-quality corporate bonds this year, with $19 billion invested in investment-grade corporate debt around the world since the start of 2023. The interest reflects investors' desire to lock in historically high yields offered by safe corporate debt after last year's sell-off. The average US investment-grade yield has increased to 5.45% from 3.1% a year ago, making it more attractive compared to last year and most of the last decade. Many fund managers prefer to stick with debt issued by companies better placed to weather a potential economic downturn as higher interest rates slow the economy.

THE DOLLAR DRYSPELL FOR CHINESE STARTUPS#

Last year, dollar investments in Chinese start-ups fell by nearly three-quarters, prompting many to raise capital and list domestically. This was due to geopolitical tensions with the US, Beijing's tech crackdown, and a harsh zero-Covid policy that spooked foreign investors. The drop in dollar funding for start-ups comes as large international investors pull back from pouring money into China-focused private equity and venture funds. To offset the loss of international investors, Beijing has stepped up the support of its most promising high-tech start-ups.

NOT FOR SALE#

Blockchain.com has denied rumors that the company is up for sale. The company stated that it has no plans to sell and is not in talks with anyone about a potential sale. Blockchain.com also revealed that it has experienced significant growth over the past year, with more than 31 million verified users on the platform and over $1 trillion in transactions processed since its launch.

THE BITCOIN RALLY#

The Bitcoin price has surged to $25,000, but it is now facing resistance at the $1.13 trillion market cap level, which may trigger a market-wide correction. The market's total value will need to break above this level to confirm the bullish trend. However, a pullback to around $20,000 could occur if this resistance level holds. Other factors, such as institutional adoption and regulatory developments, could also influence the market's direction.

NEW T-BILL OFFER#

The U.S. Treasury is selling 28-day bills that pay a 5% yield, attracting investors who are seeking a high return without the volatility of stocks. The bills are considered safer than equities because they offer a fixed return and carry no credit risk. Investors are seeking alternatives to cash and money-market funds as they grapple with the risks posed by a potential U.S. debt default.

- Till we yield again

‍