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FULL COIN TELEGRAPH ARTICLE HERE: https://cointelegraph.com/news/tether-s-market-cap-could-overtake-ethereum-s-next-year-bloomberg-report
A new report predicts Tether could surpass Ether’s market cap by the end of next year, paving the way to mainstream adoption of stablecoins and central bank digital currencies (CBDCs).
According to Bloomberg’s Crypto Outlook report for Q4 2020 written by Senior Commodity Strategist Mike McGlone, Tether (USDT) is likely to take the number two position by market capitalization from Ether (ETH) in 2021. The report cited the “stagnant market cap” of ETH, which currently stands at $43.2 billion but remained under $30 billion for most of 2019 and 2020, before getting a boost from DeFi in late July.
USDT’s market cap, on the other hand, has seen steady growth since 2017, with just one significant dip in October 2018. The stablecoin began 2020 with a market capitalization of $4.1 billion, “rapidly rising” to $15.7 billion in October.
Market capitalization of Tether v. Ethereum. Source: Bloomberg
“It should take something significant to stall the increasing adoption of Tether,” McGlone stated. “If current trends prevail, the market cap of Tether may surpass Ethereum next year.”
Not everyone in the crypto community will appreciate the prediction. Crypto pioneer Adam Back told his 211,500 Twitter followers on Oct. 11 that Bitcoin (BTC) is “the only benchmark that matters” as he believes the majority of investor portfolios are denominated in the cryptocurrency.
“I use stablecoins, but I don't hold them much as that's short Bitcoin,” said Back. “Any strategy that doesn't involve holding Bitcoin is at high risk of underperforming Bitcoin.”
Though the report suggests the demand for Tether indicates that the arrival of central bank digital currencies (CBDCs) is simply “a matter of time,” it also predicts a bullish future for Bitcoin.
Bloomberg stated BTC will be “adding zeros” as it rises from its current price of $11,448 to $100,000 by 2025. With a fixed coin supply of 21 million, “demand vs. supply metrics remain price-positive,” it said.
“Bitcoin could continue doing what it has for most of its nascent existence, appreciating in price on the back of increasing adoption, but at a slower pace,” the report stated.
“Most demand and adoption measures indicate Bitcoin is more likely to stay on its upward path.”
FULL COINDESK ARTICLE https://www.coindesk.com/fca-bans-sale-of-cryptoderivatives-to-retail-consumers-in-uk
The Financial Conduct Authority (FCA) has published final rules banning the sale of derivatives and exchange-traded notes (ETNs) that reference certain types of crypto assets to retail consumers.
The U.K. financial regulator said it considers these products to be ill-suited for retail consumers due to the harm they pose, asserting they cannot be reliably valued by retail consumers because of the:
Inherent nature of the underlying assets, which means they have no reliable basis for valuation
Prevalence of market abuse and financial crime in the secondary market (e.g., cyber theft)
Extreme volatility in crypto asset price movements
Inadequate understanding of crypto assets by retail consumers
Lack of legitimate investment need for retail consumers to invest in these products.
Specifically, the ban will affect “the sale, marketing and distribution” to retail investors of any derivatives contract or ETNs that linked to “unregulated transferable crypto assets” issued by entities in or outside the U.K.
The FCA classifies unregulated transferable crypto assets as “tokens that are not ‘specified investments’ or e-money, and can be traded.” The term incorporates major cryptocurrencies like bitcoin, ether and XRP.
The U.K. ban will come into effect on Jan. 6, 2021.
“This ban reflects how seriously we view the potential harm to retail consumers in these products. Consumer protection is paramount here,” said Sheldon Mills, interim executive director of Strategy & Competition at the FCA.
Mills said high price volatility and the difficulty of “reliably” valuing crypto assets brought high levels of risk for retail investors. “We have evidence of this happening on a significant scale,” he said “The ban provides an appropriate level of protection.”
The regulator suggested that retail consumers would save around £53 million from the ban on such derivative products.
The announcement comes as the latest setback for traders of crypto derivates, after the BitMEX exchange and its CEO Arthur Hayes were charged by U.S. authorities with allegedly facilitating unregistered trading and other violations.
The Commodity Futures Trading Commission said on Oct. 1 that the exchange had illegally provided U.S. traders with cryptocurrency derivatives trading, while the Department of Justice charged Hayes and others with violating the Bank Secrecy Act and conspiring to violate the act.
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