Original source: thestreet
Summary of key points:
Recent regulatory warnings about cryptocurrencies
Elon Musk's idea of inflation hedging
Katie Haun embarks on a new journey
European regulators recently warned investors that they could face a financial crisis for investing in cryptocurrencies.
On March 17, the European Union's securities, banking and insurance sector issued this warning. In the statement, the regulator's assessment of cryptocurrency investments was not stingy.
"If consumers buy these assets, they face a very realistic possibility of losing all their investment funds."
The announcement is the latest EU bashing of the cryptocurrency industry.
The main argument is that cryptocurrencies are not regulated and that there is no way for cryptocurrency investors to get their money back if the money invested in the industry is lost. According to the European Union, the same thing happens if cryptocurrency investors lose money due to fraud and scams.
"Consumers should be wary of the risks of misleading advertising, including through social media and influencers," the EU said. "Consumers should be particularly wary of promised quick or high returns, especially those that don't look as good as they really are."
The EU's announcement comes at a time when cryptocurrencies are increasingly under scrutiny by government regulators and financial industry advocates.
A big problem for cryptocurrency critics is the top-heavy imbalance among Bitcoin investors.
According to Banklesstimes.com, the top 100 Bitcoin owners hold 14.6% of bitcoin. On the other hand, the number of total Bitcoin holders is 41 million and is rising every year.
According to Industrial Research's 2022 Global Cryptocurrency Market Insights Report, the global cryptocurrency market is expected to grow by 3.5% from 2022 to 2028.
"Of the total supply of 21 million BTC, 90 percent has already been minted," the BanklessTimes report said. "Therefore, we can expect that the number of addresses held will increase as more people learn about digital currencies in the coming years."
TheStreet.com investment experts continue to monitor the cryptocurrency market, and these stories are working.
Crypto Queen Haun gets new funding
Venture capitalist Katie Haun, who has been linked to the rise of Coinbase and Open Sea, is back on the ground. Haun has raised more than $1.5 billion in a pair of funds designed to invest in Web3 companies.
Web3 is the third generation of the Internet, which includes applications that are built and operated on the blockchain, such as cryptocurrencies and NFTs.
TheStreet's Ellen Chang reports that haun has set a new record for raising the largest initial fund by a female founding partner, according to Pitchbook. Chang noted: "The previous record was set by former investment banker Mary Meeker, who raised $1.3 billion in funds after spinning off from Kleiner Perkins.
Haun is a former partner at A16z and co-chairman of the firm's three cryptocurrency funds, and is well known in cryptocurrency circles.
During Haun's tenure at Andreessen Horowitz, she and her former partner Chris Dixon initiated and expanded "one of the world's oldest and largest dedicated cryptocurrency risk concessions," Haun noted in a Blog Post of March 22, introducing the new venture capital firm, called Haun Investment.
According to Chang, Andreessen Horowitz will be a limited partner at Haun Ventures. Both Dixon and the venture capital firm's founder, Marc Andreessen, have made individual donations to the fund.
Haun was an early adopter of cryptocurrencies and created one of the government's first cryptocurrency task forces in 2014.
"In this work, the enormous potential of these technologies quickly became clear," she wrote. "Like any tool, they can be used for the good and the bad, but we're just beginning to get into the good."
Chang noted that the size of the fund allows her business to invest next to other cryptocurrency investors.
"One of the unique things about the size of our fund is that we don't have to dominate every transaction and we can work well with many other cryptocurrency investors. Founders don't want a single investor on their capital tables, even in the early rounds," Haun told CNBC.
According to recent data from CB Insights, blockchain startups are still attracting investors' money, netting $25 billion from venture capitalists in 2021, a jump of 8 times.
WisdomTree's Steinberg believes that blockchain will play a greater role in payments
Real Money's Doug Kass noted that blockchain is more powerful in the payments and finance space.
Jonathan Steinberg, founder and CEO of WisdomTree Investments (WETF), said on a recent corporate earnings call: "The convergence of blockchain technology with pervasive smartphone ownership and tokenization will effectively blur the boundaries between saving, payment and investing, fundamentally changing the way consumers perceive and interact with their money and assets."
Steinberg's company is launching WirelessTree Prime, a digital wallet that leverages blockchain to "bring the look and feel that users are accustomed to getting from traditional mobile apps, while providing the benefits of a digital financial services experience based on DeFi principles," Steinberg said.
The new wallet, which will be tested this spring and officially launched by the end of the year, is expected to target the booming digital payments and financial trading market.
"As a pioneer in launching blockchain-enabled funds and tokens, we have the opportunity to dominate the market that generates beta and alpha strategies, a large addressable market where we can generate huge economic benefits, rapidly scale up, and greatly accelerate organic growth," Steinberg said. "We are very confident that the assets will be transferred to the blockchain because the efficiency and enhancements are simply too great to ignore."
Musk holds his cryptocurrency tightly
Tesla founder Elon Musk may have been in the news last week when he challenged Russian President Vladimir Putin via Twitter to demand a brawl with his bare hands.
But investors may find Musk's views on his investments — and his cryptocurrency — more illuminating.
The host of The Ross Maconomics and TheStreet's Crypto Minute video show said: "Musk has recently caught the attention of cryptocurrency enthusiasts because he believes that physical property or stock is a better hedge against inflation, but he will hold his Bitcoin, Ethereum and Dogecoin.
"Last week, Musk launched a 1-on-1 challenge to Putin," Mac said. "It all started with a question to his followers about their perception of inflation rates for the years to come."
According to Mac, this prompted Michael Saylor, CEO of MicroStrategy, to use Bitcoin's value as a hedge against inflation. Elon made a joke and said apparently Saylor would say that, but went on to add that when inflation is high, he actually prefers physical and stocks," Saylor noted.
"However, Elon did say he would not sell his Bitcoin, Ethereum and Dogecoin, giving the bull market something to celebrate," he added. "Year-to-date, both Bitcoin and Ethereum have fallen by about 15 percent and 30 percent, respectively. Do you think we're seeing a rebound coming? "
Vitalik Buterin's concerns
On the March 21 episode of One Minute in Cryptocurrency, host Catherine Ross mined a recent interview with Ethereum founder Vitalik Buterin by Time magazine.
Ethereum's founders have a cryptocurrency concern. Vitalik says that cryptocurrencies as a whole have "dystopian potential" if they run incorrectly," Ross noted.
He also spoke about opposition to NFTs, particularly his concerns surrounding glitzy wealth within cryptocurrencies and the implications for spaces like NFTs. When discussing NFTs at the Bored Ape Yacht Club, he said it was a "gamble," she added.
But that's not all negative, Buterin told THE TIMES that he maintains hope despite the current public perception that ETH will be the starting platform for socio-political experiments.