Inflation Will Come And Will Stay

Inflation Will Come And Will Stay


2023-05-18 22:42:44

Market situation

US stocks in the second session at the beginning of the week were quite quiet. Closing the session down slightly in the Dow Jones and S&P 500, the small gain in the Nasdaq index. Stock futures rose slightly. Gold and oil prices are around 1853 USD/ounce and 80 USD/barrel.

Bitcoin price fell slightly to $22,200. Most of the top altcoins also corrected in the past day.

Within the past one month, Coinshare statistics show money leaving the crypto market. As recently as last week, there was 17 million USD leaving investment funds.

This week, Fed Chairman Powell will attend hearings in the Senate and House of Representatives. The market waits to see what the Fed chair will say and his attitude towards interest rates and inflation. The PCE index was released not as expected, causing many investors to worry that the Fed will raise interest rates higher. Thuan thinks that Chairman Powell will still repeat what he said before. He also said things that needed to be said so it would be too different from the known market information. The inflation rate has slowed down and the economy has slowed down but it is still good, so the current interest rate strategy is still considered to manage inflation.

In addition, the Fed still has no new data to make its decision on interest rates. There will be announcements on unemployment rate and labor data this week. Unemployment is being estimated similarly to last month and not rising. Unemployment is still at a good level, maybe the Fed will be more aggressive because they want unemployment to increase.

According to the website Truflation, inflation is continuing in a downward trend. This website’s inflation information shows the general trend of inflation quite accurately. Inflation continues in a downtrend is what the whole market is still expecting.

Economic inflation goes up but there is one asset where inflation is always falling: Bitcoin. Bitcoin’s falling inflation rate stems from a fixed supply of 21 million BTC. The rate decreases every four years during the BTC halving event. As a result, BTC’s inflation rate has been steadily decreasing since its inception in 2009, to a mere 1.79% as of March 4, according to WooBull data. This makes Bitcoin act as a possible hedge against inflation and economic instability.

With fiat money, inflation will always be there, so we need to find a store of value. The choice of BTC or other assets as a store of value will depend on each person’s point of view and the amount of time that the individual wants to store value. If stored in fiat currency, it always depreciates over time. If you choose gold, the current price of gold compared to 10 years ago has not changed much. So, if you store it for a long time in gold, the storekeeper will lose some of its value when deducting inflation. And BTC in long-term storage will show significant price growth. With Thuan chooses to store most of his assets in BTC.

America wants to ban Tiktok

A much-anticipated bipartisan Senate bill to give the president the power to respond to threats posed by TikTok and similar companies will be announced by Senate Intelligence Committee Chairman Mark Warner on Wednesday. these three weeks.

The exact text of the law has not been released, but Mr Warner thinks the scope of the bill would not be limited to TikTok, which is owned by Chinese tech giant ByteDance. He said that TikTok can spread disinformation and influence quickly.

The idea of ​​using the law to address national security concerns over TikTok has surfaced in recent months, as negotiations between the company and the Biden administration’s foreign investment committee, CFIUS, has stalled. It also raises concerns that political tensions between China and the United States will increase.

Binance prints a large amount of TrueUSD

After being sued by the SEC, BUSD issuer Paxos has announced the end of support for this stablecoin. So, the capitalization (blue line) of this stablecoin has dropped rapidly over the past week as investors switch from holding BUSD to fiat or other stablecoins.

During this time, Twitter account Lookonchain shows notable moves by Binance exchange. This account indicates that, from February 16 to 24, 180 million TrueUSD (TUSD) coins were printed. At the same time, this person said that this number was printed by the Binance exchange and will be used by this exchange.

TrueUSD is a stable coin released in 2018 by TrustToken. It was born on the Ethereum network platform with a 1:1 exchange rate to USD. TUSD was once expected to become a substitute for USDT. However, after that, the coin did not gain much popularity.

After BUSD dropped rapidly in capitalization, Lookonchain also found that TUSD has a very strong growth in capitalization. Because Binance printed a large amount of TUSD to use as an alternative to BUSD.

So what made Binance choose BUSD over USDC?

USDC is the second largest stablecoin by market capitalization in the crypto market after USDT. However, Binance did not choose to use this coin for two reasons.

The first reason, the issuer of USDC is Circle which is based in the US. The crypto exchange that competes directly with Binance, Coinbase, has a very close relationship with Circle. Many people think that Coinbase and Circle are one. So this could be the reason why Binance didn’t opt ​​to use USDC.

Next, the two big companies behind Circle are investment firm Blackrock and Fidelity. In 2022, four companies including BlackRock, Fidelity Management and Research, Marshall Wace and Fin Capital invested an additional $400 million in Circle. Recently, Fidelity is also looking to set up its own crypto exchange. As can be seen, a lot of big companies are entering the crypto market and want to gain market share. Because they believe that the crypto market will grow more and more. And later on, these companies can become competitors to Binance.

About the TUSD coin issued by the TrustToken company, this company also previously owned the TRU token. However, the TrueUSD and TRU token issuers split up some time ago. TrustToken sold TUSD in 2020 to a company called Techteryx, as announced by TrustToken CEO Rafael Cosman at the time. The post said Techteryx is an “Asia-based conglomerate with businesses … in the traditional real estate, entertainment, environment and IT industries.”

TrustToken also split from the TrueFi protocol and was renamed Archblock last year, as TrueFi embarked on the path of decentralizing the platform.

Currently, TUSD is managed and supported by Techteryx. However, not much is known about this company other than some of the information above.

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#Inflation #Stay

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