What happened this week around blockchain and cryptocurrencies? The most relevant local and international events as well as appealing background reports in a pointed and compact weekly review.
Selected articles of the week:
A few weeks ago, Luzerner Kantonalbank (LUKB) made headlines with the announcement of a cryptocurrency offering set for early 2024, marking a surprising debut among cantonal banks. However, this week, their counterparts in Zug took the spotlight by launching an immediate trading and custody service for six selected cryptocurrencies, establishing ZugerKB as the first cantonal bank to offer crypto services. This offering was made possible through collaborations with similar partners as LUKB. It’s only a matter of time before more Swiss retail banks follow suit. PostFinance is also expected to enter the market in spring 2024.
Zuger Cantonal Bank is the first cantonal bank in Switzerland to offer customers direct handling of Bitcoin, Ether and other crypto assets.
The Swiss Financial Market Supervisory Authority (FINMA) recently announced a change in practice regarding the approval of so-called staking services, now requiring providers to obtain a full banking license. Swiss crypto service providers have expressed concerns that this imposes an additional and disproportionate hurdle, with industry associations such as the Swiss Blockchain Federation and Crypto Valley Association raising objections to the practice change. Meanwhile, FINMA justifies its interpretation based on the DLT Act passed two years ago, asserting that the relevant provisions are “clear and precise,” leaving no room for regulatory discretion. An overview of the debate including exclusive statements by FINMA and industry representatives.
FINMA counters the outcry from the blockchain industry by saying its staking practice change is precisely regulated in the DLT Act. An overview.
Two years ago, the crypto industry reached a significant milestone when the U.S. Securities and Exchange Commission (SEC) approved the first Bitcoin futures-based exchange-traded fund (ETF), opening up the market to a broader investor base. On its first trading day, the ETF achieved a record volume of over one billion USD. Expectations for a similar product for the second-largest cryptocurrency by market capitalization, Ether (ETH), were accordingly high. However, the futures-based nature of these ETFs and a more pessimistic market environment compared to two years ago resulted in a disappointing start, with traders transacting just over one million USD within the first 24 hours.
The SEC approved the first futures-based Ether ETFs in the U.S., though the products’ trading volumes were rather low.
The buzzword “Web 3.0” has entered the vocabulary of prominent companies in various industries. As a transformation of today’s Web 2.0, it aims to delegate control over digital data and assets back to the user. Advocates hail Web 3.0 as a transformative force promising decentralization, democratization, and enhanced data privacy. Skeptics, on the other hand, view the movement with caution, highlighting potential pitfalls and unintended consequences. Realistically, the merger of these two worlds is likely to bring both advantages and disadvantages for internet users.
Web 3.0 promises to bring transformative potential to today’s Internet, but it also brings significant hurdles.
In addition: The crypto markets remained relatively subdued over the summer, characterized by low trading volumes and even lower volatility. Currently, the extent of Bitcoin price fluctuations sits at levels lower than those of oil, providing a noteworthy indication of the current market apathy. Nonetheless, there were some events that kept the industry engaged. A summary of the developments in the third quarter.
A summary report on the leading trends in the crypto markets over the past quarter in collaboration with Kaiko.
