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Eyeing EU Banks, Hex Trust Teams With SIA on Crypto Custody

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Multinational payments firm Sia is partnering with cryptocurrency custodian Hex Trust to help its European banking clients hold digital assets.

“When you have one bitcoin, it’s not a big problem, but when you start adding 10, 20 or 100, you have a treasury and you have to decide where to store this,” said Daniele Savarè, SIA’s innovation and business solutions director. “We are discussing digital custody needs with banks in Europe.” 

The firm is also helping banks manage and safekeep security tokens and central bank digital currencies, he added.

Through SIA, Hex Trust plans to offer European banks the software to custody digital assets on behalf of their customers. Hex Trust will also act as a sub-custodian for banks that don’t want to directly offer the service, said Hex Trust CEO Alessio Quaglini. 

Currently, Hex Trust works with three banks – Mason Privatbank Liechtenstein AG and two unnamed Asian banks. Quaglini said Hex Trust has 10 other banks that are exploring the custodian’s products.

Going forward, SIA will be the primary distribution partner for Hex Trust to offer digital-asset services to banks in Europe, Quaglini said. 



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TSLA Stock Down 2% Now, Elon Musk Suggests Tesla Hatchback Model for Europe

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Speaking at a virtual conference on batteries hosted by the German government, Tesla CEO Elon Musk suggested that the company could launch a hatchback model for Europe.

Tesla Inc (NASDAQ: TSLA) stock is down approximately 2% during Wednesday’s pre-market after closing yesterday at $555.38, up 6.43%. All these movements come at the time of distributing the news that the company could launch a Tesla hatchback model in Europe.

Tesla stock has been among the best performing traditional stocks during the pandemic, whereby it has experienced over fivefold rally. Notably, the company has just surpassed the $500 billion market capitalization and stands at $526.24 billion at the time of writing.

With 947.9 million outstanding shares, Tesla has been able to raise substantial capital to fund its global market venture. Hereby capable of competing with Chinese EV companies that are not only springing up fats but also growing globally tremendously.

Nevertheless, Tesla investors are very optimistic that the company will emerge among the top winners in the post-COVID period. Supported by past performance, Tesla shares are likely to reach $600 according to different analysts’ predictions.

According to the metrics provided by MarketWatch, Tesla shares have rallied over 744% in the past twelve months. In addition, they have managed to add over 563% year to date, and are now up 37.26%, 30.78%, and 25.76% in the past three months, one month and five days respectively.

There are several fundamentals that are likely to affect Tesla stocks in the near future. One is the awaited ruling if Tesla shares will be added to the S&P 500 index by next month. If this happens, it will be a huge bull confirmation that will push Tesla stock beyond the current gains.

However, Tesla stocks have had a blick past history with whale investors that might cause its shrinking in the near future. Notably, sometime last month nearly 48 million Tesla stock shares, approximately 5% of the outstanding shares – worth more than $25 billion at current prices – were sold short. Whether this was a risk mitigation method as we approach the end of year holidays or not, it is a call for alarm in the Tesla stock near-future prospects.

Possible Tesla Hatchback Model for Europe

Speaking at a virtual conference on batteries hosted by the German government, Tesla CEO Elon Musk suggested that the company could launch a compact hatchback model for Europe. “Possibly in Europe it would make sense to do, I guess, a compact car, perhaps a hatchback or something like that,” Musk noted.

He further highlighted that a small compact model has a higher demand in Europe than in the United States that most people prefer bigger cars.

If Tesla manages to significantly penetrate the European market, its shareholders will greatly benefit. Apparently, Tesla’s rising market valuation continues to shrink the gap between it and Berkshire Hathaway.

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Long in China’s Shadow, the US Is Becoming a Bitcoin Mining Power Again

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When it comes to the energy- and capital-intensive process of mining cryptocurrency, people tend to think of China, where about 65% of global hash power is located.

But like many other closely observed metrics in crypto, American hashrate is a number that seems to be on the cusp of significant increase. 

Crypto mining, which harnesses data centers full of specialized computers to earn bitcoin by processing a so-called proof-of-work algorithm, is an industry that’s about to come out from under the radar in North America, say its proponents, and become new core infrastructure.

While the U.S. and Canada don’t have the cheapest energy on the planet, there’s plenty of underused power and energy infrastructure to repurpose. But the really deciding factor is stability, and with that comes access to capital markets and institutional investment.  

See also: Bitcoin’s Mining Difficulty Sees Largest Percentage Drop in 9 Years

There are at least 23 listed crypto mining companies, the majority of which are based in the U.S. and Canada. 

“U.S. equity markets continue to be the most favorable listing venue for mining companies,” Ethan Vera, CFO and co-founder of mining company Luxor Technologies, told CoinDesk. “They can raise through [at-the-market] offerings, which provide a very solid financing method for public companies looking to scale up their operations. Foreign companies have more limited financing levers and have a relatively harder time raising capital through equity.”

A prominent example is Nasdaq-listed Marathon Patent Group, which spent $50 million on a fleet of Bitmain’s state-of-the-art S19 Pro Bitcoin mining computers earlier this year. Marathon is building out a 105-megawatt (MW) mining facility in Hardin, Montana, as part of a venture with Maryland-based power provider Beowulf Energy. 

“As a public company, everything we do is transparent,” said Marathon CEO Merrick Okamoto on Tuesday at Bitmain’s Mining and Investment Summit 2020. “There are disadvantages to letting everybody know what you’re doing, but it’s also a benefit. It gives us unique access to capital markets. We’ve done two financings in the last year.” 

Ruthless algorithm

China may have lorded it over the crypto mining space until now thanks to cheap labor and a massive over-build in dam and hydro generation infrastructure. But the U.S. has begun catching the attention of Chinese players looking to diversify, according to Peter Wall, CEO of London Stock Exchange-listed Argo Blockchain. 

“I’ve had conversations with people in the mining industry in the last few months about Chinese miners coming over to North America,” Wall told CoinDesk. “There’s been talk about it for years, but it really now does appear to be a trend we’re seeing. Miners are always looking for more stability, which North America offers, and power and hosting costs in North America are competitive and sometimes even cheaper than Chinese options.”

The obvious geopolitical implication is that the U.S. could eventually take on China in this nascent arena. But the mining community would rather couch this in terms of greater decentralization, whether that means geographical spread or selling mining company shares to the public.

See also: Peter Thiel Backs $200 Million Valuation for Renewable Bitcoin Mining in the US

“Everybody loves the geopolitical angle,” said Mike Colyer, CEO of Foundry, a crypto mining investment company owned by Digital Currency Group (which is also the owner of CoinDesk). “But the goal is not for the U.S. to dominate bitcoin mining. That’s not gonna happen. The goal here is to decentralize it throughout the world.”

That said, Colyer anticipates a muscular market in the U.S. As well as the growth afforded public mining companies, there’s a bank of interesting opportunities available regarding private investment plays in the U.S. coming from the likes of hedge funds and private equity firms that own infrastructure. 

“A lot of the power in the U.S. is deregulated, and private equity or hedge funds own a lot of power-generation facilities,” said Colyer. “They’re starting to recognize the idea they can make a lot of money mining bitcoin, and it also helps make their overall power generation more efficient. They actually save money on their core power generation, plus they can make money on bitcoin.”

Bitcoin mining comes in for some stick thanks to its gargantuan energy consumption, but less attention is paid to the fact it’s also at the forefront of energy innovation. Colyer calls the Bitcoin system’s mining algorithm “ruthless” in always driving for the lowest cost possible, which is generally towards renewables like hydro-power – the reason for a migration of up to 40,000 Chinese mining rigs at the end of Szechuan’s wet season.

Also on the renewable energy push is Layer1, the West Texas-based wind-powered mining operation backed by Peter Thiel.  

Cogeneration

A combination of smart investing and energy innovation is demonstrated by Greenidge Generation, a natural gas power plant in upstate New York converted into a crypto mining facility earlier this year by its owner, private equity firm Atlas Holdings.

Greenidge is a “cogeneration” facility where bitcoin mining can be used to add stability to the grid. Being connected to the Millennium Pipeline system, a very liquid forward, or over-the-counter, market, also allows Greenidge to hedge out input variable costs over multiple years, Tim Rainey, Greenidge’s chief financial officer, said at the Bitmain summit.

“We have positions all the way to mid-2022, so that’s a vehicle we use to lock in our mining economics,” said Rainey, adding that “25% of our overall capacity is dedicated to mining. Then the rest of it we use for sending power to the grid when it’s needed. So, prior to bitcoin mining, it would take us 12 hours to start up and put megawatts to the grid in periods of high demand. But now we can ramp up to full 100-megawatt power within an hour. So this provides additional stability to the grid as well as mining bitcoin.”

See also: China’s Crypto Miners Struggle to Pay Power Bills as Regulators Clamp Down on OTC Desks

The U.S and Canada currently account for 15%-20% of global crypto mining hash power, with the rest split among Russia, Kazakhstan and the Nordic countries. There are around 15 mining facilities operating at scale in North America (above 50 megawatt), estimates Taras Kulyk, senior vice president, Blockchain Business Development at Core Scientific, the largest crypto mining operation in the U.S.

North America is now on a precipice of real growth, Kulyk says, thanks to its regulatory certainty and the huge amount of infrastructure built in the 1970s and 1980s in anticipation of growing manufacturing that never came. Now that people are starting to realize crypto mining is not some shady enterprise, the U.S. is better positioned at the boardroom level.

“The operational costs are a little bit more expensive in the U.S., but when you’re sinking $100 million or even a billion dollars into an ecosystem for infrastructure you’re looking at stability,” said Kulyk. 

Some government support would also be helpful, said Kulyk. To this end, Core Scientific has put together a policy paper and will be working with the Chamber of Digital Commerce to get the word to the U.S. government.

“We want the folks in Washington, D.C., to understand that digital asset mining is not bad and that there’s a right way to do it,” said Kulyk. “I’m into crypto mining but I’m a ‘greenie’ at heart. I think the right way is through renewable power sources done at scale. The larger that becomes, the lower the burden on the environment.”



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Watch These Two Alts Closely: ETH and XRP Analysis

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The rally in the crypto-market undergoes as Bitcoin is only a few hundred dollars away from hitting its all time high. Bitcoin dominance is dropping drastically since November 18 providing enough space and volumes for the boost of altcoins. This week only Bitcoin dominance is down to 3.35%.

Bitcoin dominance is in a downtrend since 2019 as more altcoins are introduced to the market.

The November 18 drop of Bitcoin dominance boosted volumes to altcoins, such as Ripple and Ethereum. Both projects recently have introduced significant updates. Ripple announced that it’s now working with Central Banks and launched XRP Ledger promotions, Ethereum completed the Staking round for its PoS transition.

XRP/USD since November 18 has gained a hefty +96.27 and touched a high of September 21. 2018 at $0.7814140. On a daily chart there is still enough room for Ripple’s price to grow, though RSI is pointing that further correction is inevitable.

XRP / USD quote on Overbit

In spite of the fact that Ripple was rejected by the resistance at $0.7814140, an hourly chart suggests that we should be prepared for another bull run. There is a symmetrical triangle on an hourly chart of XRP/USD and the pair has tested the upper edge of the triangle three times already. Breakout from the triangle will pump the price higher.

XRP / USD quote on Overbit

RSI on an hourly chart indicates that Ripple has completed the correction and is no longer on the oversold dead-zone of the indicator, MACD line has touched the signal line and is about to cross to confirm the bullish run, there is one more confirmation to be made which is a breakout from the triangle. If Ripple breaks below the triangle, support levels to watch are $0.618900 and $0.571720.

On November 23, Ripple announced that it officially added Bank of America as a RippleNET lead member. Bank of America is one of Ripple’s oldest clients contributing to the network since 2016, though only this year Ripple listed Bank of America among the other major banks, such as Santander, PNC and Nium. With such “coming out” Bank of America clearly states that Central Banks and the FED are looking towards CBDC’s and instant low-cost cross-border payment solutions.

Ethereum has shown significant growth as well, though I was sceptical on the completion of the staking, it went as planned and 524 288 ETH were staked at the Ethereum 2.0 contract. The official launch of the Ethereum 2.0 is planned on December 1, which is another date to watch for Ethereum investors and traders.

Just like Ripple, Ethereum’s token ETH still has a lot of room for growth. The bullish sentiment of ETH/USD is backed by one interesting pattern on a daily chart – double bottom.

ETH / USD quote on Overbit

ETH/USD has reached $623 and almost tested the high of June 03, 2018 at $625 and based on the double bottom pattern, the growth may continue up to $837 in mid-term. For the short-term there are several resistances that ETH has to overstep in order to continue the surge.

As seen on an hourly chart below, the pair has formed a bullish flag and the upper edge of the flag which simultaneously is a short-term dynamic resistance is still intact.

ETH / USD quote on Overbit

The most congenial price action at this point would be a decline towards $577 – $578, where the pair will hit the dynamic support and MA100, and a massive uptrend move. Nevertheless, the uptrend will be confirmed only if ETH closes above the dynamic resistance. If the breakout is confirmed in the nearest time, Ethereum will proceed further and close above this year’s high of $623.

The launch of Ethereum 2.0 will support the surge of the ETH price, as Ethereum 2.0 will apply shard-chains and will transition the whole network to PoS. The transition won’t happen rapidly, though if the launch is successful the mining cost of Ethereum will rise as the Network will apply a difficulty bomb – a protocol which perplexes mining of Ethereum.

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