What has been happening around Blockchain Technology and Cryptocurrencies this week? The most relevant local and international developments as well as appealing background reports in a pointed and compact way in retrospect in our weekly review.
With the latest Bitcoin price increase which came close to the old high of $20,000, the crypto currency is once again a topic of conversation in traditional financial media. PayPal CEO Dan Schulman and Bitcoin enthusiast Anthony Pompliano were asked by CBNC about the development of the " digital gold". In an interview, the Chief Investment Officer (CIO) of BlackRock, which is the world's largest asset manager, also commented on Bitcoin. In Rick Rieder's opinion, the crypto-currency has even the potential to replace gold. As justification for a larger adoption he refers in particular to the comprehensive CBDC projects of the central banks, as well as the easy transferability of Bitcoin versus gold.
Not only Bitcoin is attracting increased attention again. Also Ethereum, the second largest crypto currency by market capitalization, has experienced an impressive evolution. It is much more than just a digital currency. The Ethereum network is a specialized and decentralized platform for distributed computing. Using computer programs called "Smart Contracts", applications (dApps) can be developed and executed on a global scale. Since its inception, the network has gone through several ups and downs. From a hack in 2016 through the ICO hype, the platform has evolved steadily and after a maturing period, the next breakthrough came with applications for decentralized financial transactions (DeFi). Also, a major new evolutionary step is already imminent: the gradual implementation of a new consensus algorithm for a more efficient network, also known as "Ethereum 2.0". An overview of the history, development and future of the Ethereum network.
The blockchain trilemma or scalability trilemma is often given as a law, which is not necessarily true. The difficulty of maximizing the components scalability, security and decentralization at the same time. It is not necessarily the case that a blockchain can never achieve an optimum of the three elements. An overview of the nature of the problem and potential solutions by Yves Longchamp.
Blockchain technology offers a wide range of applications. Jan Brzezek, CEO of Crypto Finance AG, even saw the greatest potential in the area of "tokenization". Tokenization describes the representation of an asset on the blockchain. In addition to traditional financial products, "non-bankable assets" such as real estate, art or collectibles can now enjoy new liquidity and broader access to investors. The Swiss Bank Sygnum announced this week the launch of a platform for issuing and trading tokenized assets.
In addition: After this month's strong Bitcoin rally, there was finally a correction. Within one day, a total of USD 1 billion of leveraged Positions were liquidated. According to Senior Trader Patrick Heusser, this was a healthy development since there was no change in the macro structure of the crypto market.
Selected articles in the weekly review:
BlackRock's Chief Investment Officer (CIO) is positive about Bitcoin and describes a possibility to replace gold as a store of value.
https://cryptovalleyjournal.com/investing/blackrock-cio-sees-bitcoin-as-gold-substitute/
Ethereum has undergone a significant development and is about to reach the next milestone. An overview of the development and future of the largest smart contract platform.
Scaling issues with blockchains are due to the so-called block chain trilemma. An improvement of a feature often has to be done at the expense of another function. An overview of the special features of blockchain technology and its limitations.
Tokenization is gaining momentum in Switzerland. Sygnum Bank announces its platform for issuing and trading tokenized assets.
Swiss bank Sygnum launches world’s first regulated tokenization solution
A strong Bitcoin price increase in november was followed by a pullback, which triggered liquidations of over 1 billion dollars. According to senior trader Patrick Heusser, a necessary and important event for a sustainable healthy trend.
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