Annual inflation in the European zone did not register any improvement in the month of February. A slight drop was expected. However, the reports ended up disappointing. In fact, core inflation (inflation that excludes highly volatile items such as food and energy) rose on this occasion. It increased to 5.6%. The most worrying thing is that in France and Germany, the two largest economies in the bloc, inflation is rising. This, of course, exerts more pressure on the European Central Bank. How much more will rates have to go up?
It is no secret to anyone that things have not been very good for investment banking. And, of the big banks, Goldman Sachs has been hit the hardest due to its poorly diversified model. In the case of the other banks (Bank of America, JP Morgan, Wells Fargo, etc.), the losses of one division are covered by the profits of the other divisions. I chose to mention this because Goldman Sachs had an investor day this week. This is the first event of its kind in three years. And the market did not react very well to what was said there. At the event, the bank’s “lack of competitive advantage” was recognized. The share price fell after the event.
Goldman Sachs’ performance reminds us that we are still in an essentially bearish period. Of course the year started very well. However, buyers are already showing signs of exhaustion. In February, the S&P 500 was down 2.6% and the Nasdaq Composite was down 1.1%. However, both stock indices are still positive for the year. The Dow Jones (down 4.2% in February) is posting losses (1%) for the year.
Bitcoin has not lost its correlation with the S&P 500 and Nasdaq. The indices go up. Bitcoin goes up. The indices go down. Bitcoin goes down. So it is no surprise that the pessimism of the past few days is affecting Bitcoin as well. What about Silvergate? Rumors and news surrounding crashes (real and hypothetical) always have an effect on market sentiment. However, the price of Bitcoin goes up or down for multiple reasons. It is a question of conditions.
Now, let’s talk about the top crypto news of the week according to Cointelegraph in Spanish. This is not a news summary. This is an opinion article. The intention is to reflect on the following headlines in a skeptical and critical way. This is an article for free thinkers.
Data: Bitcoin ‘Millionaires’ Increased 140% As Price Passed $20,000
Of course, the 2017 high is an extremely important level. In fact, we are now too close to that level for my liking. What does this mean? Let’s imagine the following scenario. A person buys BTC in December 2017 at $19.8K. Instead of selling, wait. After 4 years, it is practically in the same place. In fact, you would have made more by buying US Treasuries. Well, this is not a good precedent for Bitcoin.
During previous bearish cycles, the low was always above the previous high. So, it could be said with great pride that with Bitcoin, those who wait long enough do not lose money. We can no longer say that. In other words, once we broke the support at the 2017 high, Bitcoin became a bit riskier. I mean, anything can happen here. It has been shown that this bearish period is not like the previous ones. Is different.
Sure, people who bought below the current price are now enjoying profit. But we cannot forget all those who are currently in red. Those who bought above the current price are many.
The issuer of USDC Circle will increase its staff by up to 25% in the middle of the layoff season
During a crisis, the burden is not the same for all companies. Because not all companies make money in the same way. Placing a stablecoin in the same category as Polygon, Chainalysis, Bittrex, Huobi, Crypto.com, Coinbase, Gemini, Genesis, and Wyre is misleading. Because? They are pears and apples. Cicle is growing, in large part, because stability and regulation are growing in importance.
International Monetary Fund Prefers To Regulate Cryptocurrencies Than Ban Them Outright, Report Reveals
This is good. In fact, it is quite positive. Like it or not, regulation is on the way. It is unavoidable. And I would say that it is necessary. Because an adequate regulatory framework will facilitate the entry of more capital. Simple. For large capitals, having clear and defined rules of the game means less risk. I mean, regulation implies change and sacrifice. But it also means more demand. It’s worth it? I think so.
Of course, due to the libertarian roots of this space, there are still many sectors defending the perpetuity of the Wild West. Obviously, non-regulation has its advantages. For, with these advantages, also come risks. And for the past few months, We have experienced firsthand the consequences of so much debauchery.
Another Solana crash unleashes the fury of the crypto community
Decentralization radicals do not hesitate to mention the great risks involved in relying on centralized systems. In fact, it is claimed that we lose property when using escrow services. I mean, only self-custody is property. “Not your keys. Not your coins.” Something that of course is quite absurd.
Ownership is not synonymous with custody. To say otherwise would be wrong. Moreover, capitalism, to a large extent, is based on the fact that property is not custody. The capitalist lends his property (capital) for others to work on. The capitalist puts up a piece of land or a property for rent. The capitalist can issue a loan. Those assets are in the hands of others. However, the capitalist retains ownership of those assets.
Is decentralized finance (DeFi) an earthly paradise? Aren’t there risks in the world of DeFi? Of course not. There are many risks. Distrust of centralized systems is related to idolatry of technology. Technology is not a panacea. Centralization has its risks. Decentralization also has its risks. A technological failure, for example, can mean that you lose your coins. A flawed protocol is as dangerous as an incompetent banker. Do outages put Solana-powered DeFi protocols at risk of insolvency? Of course.
Disclaimer: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
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