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PayPal brings ‘crypto gambling’ to US retailers: economist Nouriel Roubini

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Economist Nouriel Roubini has criticized online payments giant PayPal Holdings Inc for allowing its customers to buy, sell and hold BTC and other altcoins, from next year onwards. In a tweet published on Monday Roubini shared an article titled how PayPal has brought “crypto gambling,” to customers in the U.S. – which is “bad” for PayPal users:

The author of the aforementioned article is David Gerard- a staunch critic of the crypto space- is known for his book called “Attack of the 50 Foot Blockchain: Bitcoin, Blockchain, Ethereum & Smart Contracts,” that takes on the crypto and blockchain networks. On a similar beat, Gerard has now said in his new article that PayPal was going to get investors “ripped off:” 

If PayPal pursues this crypto trading market, I would expect trouble when — not if — mum-and-dad investors get ripped off.

I wonder how PayPal is going to help its new day traders deal with their tax obligations. Remember that, in the US, every individual crypto trade is a taxable event, and the IRS has already been requesting bulk data from retail-heavy exchanges like Coinbase.

Making a comparison with stock-trader Robinhood, the author pointed out how users on Paypal cannot withdraw coins and that “cash was the only way out.” Recently, Ripple CEO Brad Garlinghouse had also shared his disappointment with PayPal’s crypto venture, by pointing out the lack of withdrawal options for its users.  

Further, the author alleged that Tether was manipulating the 2020 Bitcoin market and that the stablecoin was a scam:

The price of bitcoin in 2020 is heavily manipulated…The Bitcoin price in 2020 has mostly been held up by ever-increasing issuance of billions of tethers.

Ordinary people getting into crypto gambling will end up losing to the market manipulators. PayPal is feeding its users to the sharks.

Meanwhile even the economist Roubini had earlier called out the stablecoin Tether for the “criminal manipulation” of the Bitcoin rally last June:  

Roubini has been known to be a strong critic of the crypto industry, in fact early this month he had lauded the CFTC’s charges against BitMEX CEO Arthur Hayes and claimed that Hayes and his firm were running a “massive criminal operation:” 

Source: https://eng.ambcrypto.com/paypal-brings-crypto-gambling-to-us-retailers-economist-nouriel-roubini

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Further Declines in Bitcoin Price Possible Though Grayscale is Crucial, Notes JPM Analyst

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Although Bitcoin has recovered from its vigorous price losses during the Thanksgiving massacre, analysts from JPMorgan Chase & Co believe that further declines may still occur.

The strategists pointed out that Grayscale, through its Bitcoin Trust, will play a significant role in future BTC price developments.

Is Bitcoin To Head Further South?

The primary cryptocurrency reached a new yearly high of $19,500 last week; thus, it came less than 3% away from the 2017 all-time high of $20,000. As the community began speculating on how long it will take to surpass that level, the trend reversed viciously.

Bitcoin headed south and lost over $3,000 of value in hours. Nevertheless, the cryptocurrency has recovered most of its losses and trades north of $18,000.

A JPM analysis, led by Nikolaos Panigirtzoglou, recently said that the Thanksgiving price drops had cleared the “previous froth in momentum traders’ positioning.” However, the strategists hinted that Bitcoin could still go lower.

“Momentum traders such as commodity trading advisors and other quantitative funds likely played a big role in the slide by unwinding long Bitcoin futures positions. Momentum traders have room to further propagate” the Bitcoin decline, noted the analysts cited by Bloomberg.

Apart from broaching “momentum traders,” the strategists also discussed various other reasons behind the price developments. Those included the rumors of new regulations proposed by the Trump administration and profit-taking.

Grayscale Is Key

The JPM strategists also highlighted the significant role of Grayscale and its Grayscale Bitcoin Trust on the market. The cryptocurrency manager is the most preferred company for institutional investors to receive exposure to Bitcoin (and other digital assets) without worrying about storing the funds.

This has been exemplified through 2020 as Grayscale has reported back-to-back recording-breaking quarterly results. The assets under management (AUM) have exploded in the past 12 months to over $10 billion. Somewhat expectedly, the Grayscale Bitcoin Trust has the most substantial share.

The analysts asserted that if there’s a decline in the interest towards GBTC, this could damage the narrative that Bitcoin has become a favorite among institutional investors:

“A failure by the Grayscale Bitcoin Trust to receive additional inflows over the coming weeks would also cast doubt to the idea that institutional investors such as family offices have embarked on a trend of embracing Bitcoin as digital gold replacing traditional gold as a long-term investment.”

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Source: https://cryptopotato.com/further-declines-in-bitcoin-price-possible-though-grayscale-is-crucial-notes-jpm-analyst/

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Biden announces nomination of Janet Yellen to lead Treasury Department

President-elect Joe Biden and his transition team have announced Janet Yellen as the official Secretary of Treasury nominee.

The post Biden announces nomination of Janet Yellen to lead Treasury Department appeared first on The Block.

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Biden announces nomination of Janet Yellen to lead Treasury Department


















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FCA Warns Britons over Cryptocurrency Broker Markets Pilot

Final rules banning crypto CFDs and exchange traded notes will come into effect on January 6, 2021.

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The UK’s Financial Conduct Authority said in a brief statement Monday that local investors should use extreme caution when dealing with unauthorized firms known to have been soliciting customers in the UK jurisdiction.

The regulator specifically pointed out that one of the brokers highlighted in the latest flurry, Markets Pilot, is offering cryptocurrency-related services to British residents without being authorised to do so.

Markets Pilot is posing as an authorised company and claims to be a trading name of Click World Ltd, Cnr Old and Church Street. Additionally, the company is targeting UK investors with a full range of offshore investment services, including cryptocurrencies.

Britons that have been approached by Markets Pilot should contact the FCA, and anyone that has transferred money to the firm should report the incident to Action Fraud, the regulator further states.

Moreover, the City watchdog emphasized that anyone who deals with an unauthorized firm is not protected by the UK lifeboat scheme, and thus cannot complain to the Financial Ombudsman Service.

FCA concerns underpin retail ban

The latest warning comes ahead of scheduled applicability of final rules banning derivatives that allow investors to take a view on the direction of the price of crypto assets. The ban will come into effect on January 6, 2021, and affects CFDs, options and futures, as well as exchange traded notes (ETNs) that relate to unregulated cryptoassets.

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The FCA estimates the prohibition would save investors £53 million ($69 million) a year in losses, but it would not force them to liquidate their existing trades.

The FCA considers these products are ‘ill-suited to retail consumers’ who cannot assess the risks of derivatives or ETNs that reference certain crypto-assets.

The UK government has also proposed to bring the promotion of crypto-assets into the scope of the FCA’s existing oversight, rather than creating a new framework specifically for these products.

Citing concern over investor protection, the authorities said that even companies that sell regulated investments with an underlying cryptocurrency element will need FCA authorization to do so depending on their activities.

Providing the FCA with power to regulate the promotion of certain types of cryptoassets, for the first time, would be the quickest way of doing this and stamping out misleading advertising.

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