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The Next Big Thing Amid WBTC Controversy?

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Coinbase indicated plans for a cbBTC against the backdrop of Wrapped Bitcoin (WBTC), which has become controversial in crypto.

While the product’s details are still unknown, Coinbase appears ready to dominate the market once again.

Coinbase Gains Market Edge On WBTC Controversy

The exchange’s announcement of a cbBTC turned heads, with pre-launch registration already live. Coinbase Layer-2 (L2) network Base hinted that it would run atop its blockchain, making it an alternative Bitcoin on Base, but this remains unclear.

It comes amid the WBTC controversy, following reports that BitGo is transitioning its Wrapped Bitcoin custody to a new multi-jurisdictional model. Wrapped Bitcoin is the brainchild of Kyber, Ren, and BitGo, and its January 2019 launch made WBTC the first token that makes Bitcoin (BTC) compatible with the Ethereum (ETH) network.

As a bridge between the two networks, WBTC provides Bitcoin users access to decentralized finance (DeFi) applications and allows Ethereum applications to gain additional liquidity. Specifically, it acts as collateral, enabling Bitcoin holders to participate in activities like lending, borrowing, margin trading, and yield farming on decentralized finance (DeFi) applications.

Read more: Wrapped Bitcoin (WBTC): A Beginner’s Guide

Coinbase deploying its own version of WBTC would be a game changer in the space, especially amid ongoing concerns surrounding the wrapped Bitcoin. Tether CEO Paolo Ardoino smelled foul in 2022, sharing in a post on X.

“If I were BitGo, and I believed my own story that every WBTC is backed by 1 BTC, I’d be buying every token I could right now for $0.98! A risk-free 2% return. Unless I knew it wasn’t backed, of course,” Ardoino shared at the time.

As BeInCrypto reported, Tron founder and Huobi Global advisor Justin Sun is embroiled in controversy. There are concerns that Sun will significantly influence WBTC as BitGo adopts a new multi-jurisdictional and multi-institutional custody model. Fears surrounding Sun emerge given the Tron executive’s past sour relationships with crypto projects like TUSD and Huobi’s USDT reserves.

BitGo CEO Mike Belshe anticipated the concerns around Sun ahead of the announcement and attempted to quell the matter. Nevertheless, his engagement notwithstanding, DeFi investors consider removing WBTC as collateral.

cbBTC Could Pass WBTC in Supply, VC Says

As Coinbase looks to capitalize on this confusion, venture capitalist Dan Elitzer says cbBTC is long overdue and makes his predictions. He says cbBTC could pass WBTC’s supply within six months of launch.

“cbBTC was inevitable and super strategic to Coinbase.  Frankly, I am surprised they did not ship it years ago.  Predictions: – 0 fees on mint/redeem – 0 fees to withdraw to Base – Passes WBTC in supply within 6 months of launch (unless acquisition falls through),” Elitzer says.

According to Elitzer, the massive mishandling of WBTC will create a shakeup. This comes as protocols and venues move to support alternative forms of bridged BTC. It will also benefit from more decentralized solutions like tBTC. The VC also observes that no competent DeFi user or risk manager will want to maintain exposure to WBTC under Justin Sun- affiliated management.

Indeed, DeFi platform MakerDAO is already evaluating the potential risks associated with BitGo’s new WBTC custody strategy. 

“Maker is planning to offboard WBTC due to the change in custody from BitGo. Is BitGo going to fumble its insane moat in WBTC?” DeFi dashboard builder at DefiLlama posed rhetoric in a post on X.

Elsewhere, crypto researcher Wei Dai says, “cbBTC is not the endgame.” The researcher anticipates trust-minimized bridging of BTC, citing the total value locked (TVL) on different Ethereum variants on Base.

Read more: Coinbase Review 2024: The Best Crypto Exchange for Beginners?

ETH Variants on Base As Coinbase Plans cbBTC
ETH Variants on Base As Coinbase Plans cbBTC. Source: Wei Dei

Meanwhile, crypto commentator Marty Party says permissioned bridges and permissioned derivatives like Wrapped Bitcoin on Ethereum are risky to crypto.

“They are moving the Bitcoin collateral from BitGo to Bit Global in the next 60 days. Does this mean the $9.45b of WBTC on Ethereum and Base, Aave, MakerDAO, and Compound, and therefore all those loans and corresponding collateralizations L2s will be uncollateralized during this time? Now I would not normally post this but it’s a perfect example of why I stress – Permissioned Bridges and Permissioned Derivatives like Wrapped Bitcoin on Ethereum are not Web3, and are the biggest risk to crypto,” MartyParty expressed.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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Bitcoin to $250K? Hayes Links Price Surge to Fed’s QE Move

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Arthur Hayes, former CEO of BitMEX, has predicted that Bitcoin (BTC) could soar to $250,000 by the end of the year.

However, this prediction is contingent on the US Federal Reserve (Fed) shifting its monetary policy toward Quantitative Easing (QE).

Bitcoin to $250,000, Hayes Predicts

Hayes argues that a halt in Quantitative Tightening (QT) and a return to liquidity injections would trigger a substantial Bitcoin rally.

“If my analysis regarding the interplay of the Fed, Treasury, and banking system is correct, then Bitcoin hit a local low of $76,500 last month, and now we begin the ascent to $250,000 by year-end,” read an excerpt in his latest blog.

This prediction hinges on his belief that central banks, particularly the Fed, will be forced to intervene to support financial markets, ultimately driving Bitcoin higher.

Further, the BitMEX co-founder directly ties Bitcoin’s potential price movement to the Fed’s approach to monetary policy. He argues that the central bank’s response to mounting fiscal pressures will lead to an end of QT and a de facto return to QE.

“Powell proved last week that fiscal dominance is alive and well and that he will do whatever it takes to ensure the Treasury can fund itself at reasonable rates. Therefore, I am confident QT, at least regarding treasuries, will stop in the short to medium term,” Hayes added.

Based on these, Arthur Hayes sees this as a pivotal moment for Bitcoin, emphasizing that the pioneer crypto would “scream higher once this is formally announced.”  

Hayes also reinforced his confidence in the prediction, stating that his Bitcoin target is attainable as the bond market, banks, and Congress (which he terms BBC) will pressure the Fed into action.

British financial expert Raoul Pal supports the thesis of a bullish outlook for Bitcoin price. The former Goldman Sachs executive pointed to macroeconomic indicators that suggest a Bitcoin rally is imminent.

Raoul Pal shared a chart correlating the global M2 money supply and Bitcoin’s price. Based on history, Bitcoin tends to rise around 10 weeks after M2 increases, with Pal’s analysis suggesting that Bitcoin may soon enter a bullish phase.

“The waiting game is almost over…the 10-week lead is my preferred… but,” Pal remarked.

Bitcoin vs Global M2 Supply
Bitcoin vs Global M2 Supply. Source: Raoul Pal on X

QCP Capital’s Stagflation Warning

Adding another layer to the macroeconomic picture, analysts at QCP Capital warn that if stagflation takes hold, the Fed could lean toward hiking rates instead of cutting them. Such an action would complicate the bullish outlook for Bitcoin.

“Markets continue to price 2.5 cuts in 2025. The Fed finds itself in a tight corner with consumer confidence and soft data coming in weak which may portend weaker GDP in Q2. At the same time, tariff-induced inflationary pressures could start building after April 2,” the analyst wrote.

The optimism comes despite Bitcoin logging its worst first quarter (Q1) performance in seven years. This notwithstanding, analysts point to a bullish momentum, suggesting that a price recovery is on the horizon.

“Sellers have dried up, and buyers seem comfortable with current price levels – setting the stage for a structural supply shortage. April-May could turn into a consolidation zone – a calm before the next impulse,” stated market analyst Axel Adler Jr. 

Veteran investors are also increasing their Bitcoin holdings, signaling a phase of accumulation that often precedes strong price rallies. Market data also indicates that declining selling pressure from Bitcoin holders is paving the way for a potential push toward $90,000.

Bitcoin (BTC) Price Performance
Bitcoin (BTC) Price Performance. Source: BeInCrypto

Meanwhile, Standard Chartered has noted Bitcoin’s growing role as an inflation hedge. This further solidifies the pioneer crypto’s place as a macroeconomic asset in uncertain financial times.

Nevertheless, as macroeconomic concerns continue challenging Bitcoin’s attractiveness, Gold is progressively presenting as an alternative store of value. BeInCrypto also reported that gold is outshining Bitcoin as a haven amid Trump’s 2025 tariff chaos.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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US Dollar Index Drops – What Does It Mean for Bitcoin?

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Amid the recent implementation of President Trump’s “Liberation Day” policies, the US Dollar Index (DXY) has plummeted to its lowest level since mid-October 2024. This signaled a turbulent time for the greenback.

Despite the downturn, some analysts believe the weakening dollar could fuel short-term gains for Bitcoin (BTC).

Could Bitcoin Benefit From a Weaker Dollar?

The DXY, a key measure of the US dollar’s strength against a basket of major currencies, has been under pressure amid a combination of factors. Growing concerns over a potential recession and escalating global trade tensions have contributed to this downtrend. 

After reaching a two-year high in early January, the DXY has experienced a steady decline. Furthermore, it has shed nearly 4% in the first quarter alone. 

US Dollar Index (DXY) Performance
US Dollar Index (DXY) Performance. Source: TradingView

Economist Peter Schiff highlighted the dire state of the DXY in the latest X (formerly Twitter) post.

“The US Dollar Index has fallen to its lowest level since Oct. and looks like it’s headed much lower,” he wrote.

Schiff emphasized that contrary to expectations that a strong US dollar might alleviate the impact of tariffs on American consumers, the reality of a weakening dollar will have the opposite effect. Therefore, this exacerbates the financial strain from tariffs, making them more burdensome for consumers.

BeInCrypto reported that on April 2, 2025, President Trump implemented the new “Liberation Day” tariffs. These reciprocal tariffs enforce a minimum 10% duty on all imports. Nonetheless, they have raised concerns about a potential global trade war and further weakened the dollar’s value.

A Reuters report highlighted that the dollar slid against the yen. Meanwhile, the euro gained 0.3% to trade at $1.08, reflecting market unease over the tariff announcement.

However, it’s not all bad news—at least not for crypto. Some market observers believe Bitcoin could emerge as a key beneficiary of the dollar’s woes.

Ciara Sun, Founder and Managing Partner at C² Ventures noted on X that the likelihood of multiple Federal Reserve rate cuts in 2025 is growing. This move could further weaken the DXY and boost Bitcoin’s attractiveness. 

“The Dollar Index shows signs of slowing momentum, potentially favoring risk assets,” Sun remarked.

Sun’s analysis aligns with the inverse correlation between Bitcoin and the US dollar, as outlined in a CoinGecko report from late 2024. 

“When the dollar weakens, Bitcoin often strengthens, making it an attractive alternative,” the report noted.

Bitcoin and US Dollar Index Correlation
Bitcoin and US Dollar Index Correlation. Source: CoinGecko

Adding to the bullish sentiment for Bitcoin, Arthur Hayes, the former CEO of BitMEX, predicted a significant rally for the cryptocurrency.

“If BTC can hold $76,500 between now and US tax day April 15, then we are out of the woods. Don’t get chopped up!,” Hayes claimed.

This statement follows the executive’s prediction that Bitcoin could soar to $250,000 by year-end. However, this outcome is contingent upon the Federal Reserve adopting Quantitative Easing (QE) to support the markets.

Still, the road ahead is far from clear. Bitcoin may enjoy short-term gains amid the dollar’s slump. Yet, the overarching economic implications of shifting US monetary policy and ongoing global tensions continue to pose significant risks.

Bitcoin Price Performance
Bitcoin Price Performance. Source: BeInCrypto

As of now, Bitcoin has felt the impact of the market uncertainty. It declined 1.5% in the past day to a trading value of $83,389. Similarly, the broader cryptocurrency marked has experienced a decrease, with the total market capitalization falling 3.4% within the same timeframe.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



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Lummis Confirms Treasury Probes Direct Buys

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In an interview with Bitcoin commentator Natalie Brunell, Senator Cynthia Lummis (R-WY) reaffirmed her commitment to establishing a US Strategic Bitcoin Reserve (SBR), disclosing that the Treasury Department is probing its legal authority to purchase and custody BTC on behalf of the federal government. The senator believes such a move could significantly reduce the national debt over the long term.

Senator Lummis Pushes Bitcoin Reserve

Lummis pointed to roughly 200,000 BTC in the US Marshals Service’s asset forfeiture program as a possible starting point: “Working with Treasury, and the Treasury Secretary, we’re trying to find out which assets among those could become the basis of the first year’s investment in a strategic Bitcoin reserve.”

Further clarifying her stance, the senator noted she is determining whether a new law is required or if the administration already has the authority: “What I’m trying to figure out right now is whether it needs to be done legislatively or whether the Treasury Secretary has the authority to do it right now.”

Lummis proposes converting the seized BTC into an official “base investment,” which she says would be the foundation of a larger BTC reserve. If successful, this would mark the first time the US government deliberately and openly accumulated Bitcoin as a strategic asset.

One of Lummis’ main arguments for a SBR is its capacity to trim the federal debt, which she deems “irresponsibly high.” Under her Bitcoin Act, the US could also revalue its gold certificates—currently listed at a decades-old official price of $42 per ounce, far below market value—and deploy the difference toward purchasing BTC in a budget neutral way:

“My legislation would provide that we could take our gold certificates… bring them up to current fair market value for gold and then use that to buy Bitcoin, thereby creating a 1 million Bitcoin reserve over five years.”

She contends that holding this million BTC over a 20-year horizon could “cut the current national debt in half.” Citing extensive modeling—some from advocates like Michael Saylor—she believes the price appreciation of BTC has the potential to deliver significant gains to taxpayers.

The senator lauded President Trump’s recent executive orders that aim to make the United States “the digital asset capital of the world” by fostering a favorable environment for BTC mining, regulatory clarity, and a strategic reserve. According to Lummis, those moves stand in stark contrast to prior administrations, where “people neither knew nor wanted to talk about digital assets.”

However, Lummis also underscored the need for bipartisan collaboration, suggesting that while Bitcoin has now garnered interest in Republican circles, it should not become a strictly partisan endeavor: “We want to keep that momentum… We worked extremely hard to keep it bipartisan, so I can’t flip my brain and start to think of it as a partisan issue.”

At press time, BTC traded at $84,202.

Bitcoin price
BTC hovers above $84,000, 1-day chart | Source: BTCUSDT on TradingView.com

Featured image from YouTube, chart from TradingView.com

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