Is AmazonCoin coming?
The crypto market had a strong start last week, but rising geopolitical tensions in the Middle East threw a spanner in the works. Bitcoin and ether took a hit, while oil and gold surged. Meanwhile, a structural shift may be underway: companies like Amazon and Walmart are preparing to issue their own stablecoins. Read all about it in this week's Bitvavo Market News.
Market update
Bitcoin traded above €96,000 last Monday and Tuesday, and ether recorded its highest price since Feb. 24 at €2,500 on Wednesday. Memecoins also jumped and overall, investor sentiment looked sunny and optimistic. But by Thursday, clouds were gathering.
Geopolitical unrest in the Middle East often puts pressure on financial markets. The region is home to key shipping routes and a large share of global oil and gas production. Instability there can ripple out to households, businesses, and economies around the world.
By Thursday, market concerns were already reflected in price movements. Then came the real jolt early Friday morning. Oil and gold shot up, while riskier assets dropped. Bitcoin fell by around 5%, and ether more than double that.
In the week ahead, developments in the Middle East will likely dominate the mood of financial markets. If tension eases, markets may resume their original trajectory, which was favorable for Bitcoin and Ether. But whether that happens, and when, remains uncertain.
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Is AmazonCoin on the way?
On Tuesday June 17, the U.S. Senate will vote on something that, at first glance, looks fairly minor: the GENIUS Act. It's a proposed bill that would regulate stablecoins - digital tokens that are linked to the dollar but issued by private companies instead of the central bank.
Look a little closer, though, and it becomes clear what’s really at stake: control over the payments system. And that threatens to slip away from the hands of banks and card networks, toward the servers of Amazon, Walmart, and consorts.
The Walmart Dollar
Last week, The Wall Street Journal reported that companies like Amazon, Walmart, and Expedia are actively working on plans to issue their own stablecoins. Not as speculative tokens, but as digital payment tools that you might soon use to pay at checkout or when checking out online.
Why? Because the existing payment system is slow and expensive. Visa and Mastercard charge hefty fees for each transaction. Settling those payments takes days. And if you're a multinational corporation that pays suppliers around the globe, these delays and fees are more than just an annoyance; they're a billion-dollar frustration.
Stablecoins offer an alternative. A stable digital dollar that runs 24/7, is instantly transferable, and does not require approval from a traditional banking network. In crypto, it's already long the norm. Now, the big retailers want in too.
A currency of their own
The idea of launching their own currency is not new. Companies like Walmart have had a desire to expand their financial services for decades. As recently as the 2000s, the retail giant tried to secure a banking license, but failed due to political opposition.
But the tech has moved on. Stablecoins don't need a banking license, just legal clarity. And that's exactly what seems to be on the horizon.
The GENIUS Act would, for the first time, establish a legal framework for stablecoins: rules around reserves, oversight, and licensing? Not everything is fully defined, but it's a start. And that's enough to open the door.
Tuesday, June 17, may be the day we look back on later and say: that's where it started. That's where the market was given the mandate to spend money.
In other news
The US SEC is considering an "innovation exemption" for DeFi. SEC Chairman Paul Atkins hinted in a recent roundtable discussion at a possible exemption for innovative projects, prompting a price jump in tokens like Aave and Uniswap. Such an exemption would temporarily free DeFi projects from strict regulation. Investors are watching closely, but nothing is certain until it's written into law.
Roughly 31% of all bitcoin now held by central entities. According to a report by Gemini and Glassnode, more than 6 million BTC are managed by governments, exchanges, ETFs, and corporations. This signals institutional maturity. And it's also affecting the market: since 2018, volatility has been falling steadily with fewer spikes and more gradual increases. But it raises a question: how decentralized is Bitcoin if one in three coins sits with institutions?
Paraguay briefly made headlines for supposedly adopting bitcoin as legal tender, following in El Salvador’s footsteps. But the announcement (allegedly from President Santiago Peña) was quickly revealed to have come from a hacked account. The government swiftly corrected the story: the claim was false. A classic case of something that sounded too good to be true.
BlackRock: The real growth of crypto has yet to begin. COO Rob Goldstein stated at Coinbase's State of Crypto Summit that stablecoins have a lot of use and that IBIT was geared as a bridge strategy for investors who don't want to buy bitcoin itself. He added that the financial sector is ripe for disruption through tokenization. "There’s so much more opportunity here. It’s barely started."
Satoshi Radio: It’s been a relatively quiet week in the crypto market in terms of prices. The hosts of the latest episode of Satoshi Radio take a step back and determine where we are in the market cycle. You’ll also hear the latest news, from Circle’s successful IPO to a ban on large cash payments.
This article is for informational purposes only and does not constitute a marketing communication or recommendation. None of the content herein should be considered as investment advice or a substitute for it. Bitvavo makes no guarantees regarding the accuracy or completeness of the provided information. Investments involve risks. There is a possibility of losing your entire invested capital.