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US Treasury Secretary Janet Yellen Calls Bitcoin ‘Extremely Inefficient’, BTC Price Slides Below $50K

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Yellen’s comments questioning Bitcoin price stability and volatility came just at a time when Bitcoin (BTC) was under heavy selling pressure and further declining 16% from its all-time high in a very short time.

On Monday, February 22, US Treasury Secretary Janet Yellen issued a warning that Bitcoin (BTC) poses to its investors. Yellen said that there are some important underlying questions about Bitcoin’s stability and legitimacy. Speaking to CNBC’s Andrew Ross Sorkin at a New York Times DealBook conference, Yellen said:

“I don’t think that bitcoin … is widely used as a transaction mechanism. To the extent it is used I fear it’s often for illicit finance. It’s an extremely inefficient way of conducting transactions, and the amount of energy that’s consumed in processing those transactions is staggering.”

The Bitcoin mining activity involves the use of high-end machinery to solve the algorithm and add blocks to the network. This high-end machinery also consumes surplus electricity in the process. Thus, Bitcoin critics have always pointed to the energy used in the Bitcoin mining activities.

Also, Bitcoin’s volatility has always remained a point of criticism for lawmakers. As of date, Bitcoin continues to remain a highly volatile asset class despite strong institutional participation. Considering the recent example, the BTC price tanked 16% later on Monday, February 22.

From its all-time high of $58.3K Bitcoin (BTC) has slipped below $50,000 levels in less than 48 hours. With this Bitcoin (BTC) also loses its status of being a trillion-dollar asset class. At press time, BTC is trading at a price of $49,762 with a market cap of $921 billion.

“It is a highly speculative asset and you know I think people should be aware it can be extremely volatile and I do worry about potential losses that investors can suffer,” Yellen said.

However, Yellen remains positive about digital currency technology and its inclusion in the payments system. “I think it could result in faster, safer and cheaper payments, which I think are important goals,” Yellen said.

Market Analysts Undeterred with Views of Yellen on Bitcoin

Crypto market analysts have been calling out central banks for printing money out of thin air under the pretext of boosting economic activity. Concerns about inflation have already pushed financial institutions and corporate closer to Bitcoin (BTC). Soon after Yellen’s comments on Bitcoin, Rich Dad author Robert Kiyosaki said:

“Sec Treasury Janet Yellen states: “Bitcoin is extremely inefficient.” Give me a break. Does she think printing trillions of fake dollars is efficient? Does she not know the more fake dollars she prints the more efficient and valuable Bitcoin becomes? God bless her”.

Just before the interview, CoinShares chief strategy officer Meltem Demirors spoke to CNBC. She said:

“The regulatory issues have been around for a long time, we’ve been dispelling them for a long time. At this point, our belief is: Bitcoin is not a question of if, but when. We certainly believe, you know, the best time to invest in bitcoin was yesterday — the second best time to allocate is today”.

Other news from the cryptocurrency world can be found here.

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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.





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Coinbase S-1 Filing Details Shows Company Is Ready for Public Market

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According to the detail provided, founder and Chief Executive Officer Brian Armstrong reportedly earned $60 million in the 2020 fiscal year.

Details shared by American cryptocurrency exchange Coinbase in its S-1 filing with the Securities and Exchange Commission (SEC) is evident the company is set to the public markets. The cryptocurrency industry is just a bit more than a decade old but many players in the space are making waves, per revenue and income accruals.

One of the high points of the filing is the extensive growth in both retail and institutional investor transactions carried out by Coinbase. The dramatic shift in trading volumes attained its peak in the fourth quarter of 2020. Retail transactions account for 36% of all volumes, down from 80% in the early quarters of 2018. This shift is being transferred to corporate investors.

In the last quarter, retail trade value came in at $32 billion while institutional buy-ups raked in $57 billion. Amid these impressive trading figures, Coinbase was valued at $100B, making the firm one of the most valuable firms to file for direct listing through an Initial Public Offering (IPO) this year.

Money Bag Firm with Highly Paid Executives

It is surprising to note that Coinbase, a trading platform that was established in 2020 could outpace some long-standing US firms, in terms of remunerations to senior executives. While this metric may seem simplistic, it goes to show how much the company has matured in its financials.

Founder and Chief Executive Officer Brian Armstrong reportedly earned $60 million in the 2020 fiscal year. Stock options worth about $56.6 million accounted for the bulk of the total cash with the main salary coming in at $1 million, and a special package for private security worth $1.78 million was also included in the deal.

According to Coindesk, this figure stands tall ahead of revenue earned by Jamie Dimon, CEO of JPMorgan Chase & Co (NYSE: JPM) pegged at $31.5 million, and Tim Cook, CEO of Apple Inc (NYSE: AAPL), who earned $14.7 million.

Other Coinbase executives including Chief Product Officer Surojit Chatterjee raked in $15.8 million in 2020 compensation and Chief Legal Officer Paul Grewal earned $18 million in 2020.

Risks Identified by Coinbase in Its S-1 Filing

As required of companies aspiring to go public, Coinbase identified some potential risks to its business in the S-1 filing.

As gleaned, the exchange believes that unmasking the identity of Bitcoin creator Satoshi Nakamoto will pose a significant risk to its business. However, the company did not reveal how this could happen.

The filing also noted that the advances in decentralized finance (DeFi) are a risk factor for the company as the growing ecosystem competes for customers and transactions. Per the filing, Coinbase noted that they “compete against a growing number of decentralized and noncustodial platforms and our business may be adversely affected if we fail to compete effectively against them.”

Negative perceptions surrounding Bitcoin (BTC) or Ethereum (ETH), and further regulatory hassles were also listed amongst the company’s potential risks to watch.

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Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.



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Elon Musk Is Excited about SEC Rumors

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Elon Musk has played a notable role in the rise of Dogecoin into the consciousness of the public. At different points in recent times, he has made several tweets in support of the meme coin which led to spikes in its price.

With rumors swirling around that the Securities and Exchange Commission of the United States could be investigating Elon Musk, the founder of popular electric carmaker Tesla Inc (NASDAQ: TSLA), he has now come out with a statement that shows he is excited about the possibility of being under the investigation of the financial regulator. According to a tweet from his official account, Musk tweeted that “it would be awesome” if he is being investigated by the SEC.

Notably, the SEC does not consider Dogecoin, a meme-based crypto asset as a security. So investigating the digital coin for instances of market manipulation seems improbable. However, the authorities could be monitoring the SpaceX CEO’s tweets as part of its settlement charges when he was accused of committing securities fraud through misleading tweets.

SEC Pays Attention to Musk Being a Vocal Supporter of DOGE

Elon Musk has played a notable role in the rise of Dogecoin into the consciousness of the public. At different points in recent times, he has made several tweets in support of the meme coin which led to spikes in the price of the virtual asset. He also has called himself the “dogecoin CEO.” And as part of his support for DOGE, Musk said he bought his son some of the assets.

Notably, whenever Musk tweets a meme or anything in support of the cryptocurrency, the value has always appreciated. A most recent example of this was his tweet about the asset just yesterday which led to a price rise. He also hinted about the possibility of pushing DOGE into being the currency of the internet.

Dogecoin has leveraged on this support of the second richest man in the world. The asset broke into the top 10 crypto assets by mark cap recently and reached a new all-time high as more retail investors began investing in it. Some corporate institutions have also started accepting the asset as a payment method due to the increased popularity of the asset.

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Oluwapelumi is a believer in the transformative power Bitcoin and Blockchain industry holds. He is interested in sharing knowledge and ideas. When he is not writing, he is looking to meet new people and trying out new things.





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New Record Made for Individual NFT as Beeple’s Project Sold for $6.6M

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According to reports, “Crossroads” by Beeple was purchased on November 1, for $66,666.60 by a user identified as Pablo. Interestingly, the new user offered a whopping sum of $6.6 million to repurchase and stay anonymous.

Beeple, also known as Mike Winklemann, a Buzzy digital artist, has smashed the previous selling record of $1.5 million with his “Crossroads” project after its being resold for $6.6 million. According to reports, “Crossroads” by Beeple was purchased on November 1, for $66,666.60 by a user identified as Pablo. Interestingly, the new user offered a whopping sum of $6.6 million to repurchase and stay anonymous. This is said to be 100 times more than the original purchase amount. The record of the single NFT sale of Beeple’s project was held by a user identified as “CryptoPunk 6965” which according to reports sold for 800 ETH, equivalent to $1.55 million last week. 

It is disclosed that the Crossroads project was largely influenced by the 2020 US presidential election. The project has rare creativity which projected one of the two animations that may depend on the results of the election. One of the animations portrayed a triumphant Trump, and the other portrayed a forgotten and despondent one. 

The hard work and effort coupled with the creativity of digital art are highly appreciated by many, but a few people think the value of these pieces of art is exaggerated. Lark Davies, a Cryptocurrency Youtuber believes that the $6.6 million selling price of the artwork by Beeple shows NFT mania is heating up. He stated that the NFT selling price is an indication that “people have more money than sense”. 

The artist behind the project is on the verge of making another history as the first-ever NFT to be sold in a traditional auction house. His work is being listed by Christie’s Inc in partnership with Makersplace, an NFT marketplace. This will end on March 11 in a two weeks program. The artist has over the last 14 years produced a little over 5000 unique images with one produced each day. Some of the themes include the Desire and Resentment of Wealth, Society Obsession with and Fear of Technology, and Turbulent Political Scenes in America. A piece titled “Everyday: the First 5000 Days” being auctioned for $100 has received about 120 bids with $2.2 million as the latest. 

Digital artists are receiving increasing attention in recent times with the likes of Trevor Jones being the center of attraction. An edition art opened by Jones entitled “The Bitcoin Angel” was very patronized. He ended up selling 4157 editions in just 7 minutes. Selling each of them for $777, he made about $3.2 million. 

Noah Davies, a Christie’s specialist in post-war and contemporary art leading the Beeple’s sale stated that as an organization, Christie’s is excited to see about $3.5 million appearing out of thin air. He explained that the world is seeing an era where different things excite the younger collectors. This could be a demographic shift, a generational shift, or a drastic shift. 

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Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.



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