Wednesday, December 26, 2018

Wall Street Walks 🚶‍♂️

December 26, 2018

Wall Street is Reportedly Getting Out of the Crypto Market

Over the past of couple years, as crypto saw its mania and demise, rumors have run rampant about major firms becoming involved. Some say that institutions are using the bear market as a buying opportunity. Others say that the fraud and volatility scare away major investors. Now, Bloomberg is reporting that Wall Street is "quietly" exiting crypto.

Let's check in on what is going on at some of the biggest firms:

Goldman Sachs

Goldman, arguably the most respected investment bank, was one of the earliest firms to be involved in cryptocurrency rumors. It made an investment in BitGo and also launched a Bitcoin derivative product.

Now, near the end of the year, Goldman still has not launched its rumored crypto trading desk and its derivative product has little traction.

Morgan Stanley

Morgan Stanley hired Andrew Peel to head its digital assets business earlier in the year and developed a Bitcoin swaps product since at least September.

However, the firm has not yet traded a single contract due to a lack of demand.

Citigroup

Citigroup established a line of cryptocurrency products which they call "digital asset receipts". These products allow institutions to gain exposure to crypto without having to store the underlying asset.

Like Morgan Stanley's swap contracts, Citigroup has too not been able to yet sell its crypto product.

Barclays

Barclays Plc displayed interest in trading cryptocurrencies earlier in the year, appointing two former oil traders to lead a digital assets project: Chris Tyrer and Matthieu Jobbe Duval.

Tyrer ended up leaving the firm in September, and Jobbe Duval followed two months later, according to Bloomberg.

MINING

GMO is Quitting Mining Hardware Manufacturing After 'Extraordinary Loss'

Over and out

Just over a year after Japanese IT giant GMO entered into the mining hardware business, it's already pulling the plug.

The announcement came on Tuesday after management tallied up more than $320 million in losses due to the project.

This figure will be recorded as an "extraordinary loss" on the books and was likely caused by two things:

Increased competition
Poor market conditions

And GMO isn't alone with losses like this, Nvidia, AMD, and even Bitmain have all reported losses in 2018 as miners skipped new equipment.

Still mining though

Despite the losses on mining equipment, GMO still intends to mine cryptocurrencies.

But that sector also isn't looking too pretty. In Q3 and Q2 GMO lost $5.6 million and $3.2 million in mining - mostly caused by increased depreciation costs.

Now, however, GMO is confident it can return a profit as the depreciation cost will "almost be zero after recognizing the impairment cost."

BITCOIN

Bitcoin Pronounced Dead 90 Times During 2018

At every drop of Bitcoin, the media was there to pronounce Bitcoin dead time and time again.

Here are some of are favorite obituaries:

'Worthless' Bitcoin Has Entered Death Spiral: Finance Professor

CCN

Teen Bitcoin Millionaire: "Bitcoin is Pretty Much Dead"

newsBTC

Bitcoin is a 'Dead Man Walking', Claims Creative Planning CIO

CCN

Bitcoin Will Soon Be Dead, Says Wolf of Wall Street

Ethereum World News

ADOPTION

Bank of America Files Another Blockchain Patent, This Time for ATMs

Embracing blockchain

Bank of America (BoA) has been no stranger to blockchain technology. In August it was reported that the traditional financial institution has more than 50 blockchain-related patents filed.

However, the institution has turned the cold shoulder on cryptocurrencies likely because of high investment risk.

Still, it's clear BoA sees an opportunity through the noise.

Eyeing ATMs

On Tuesday, the U.S. Patent and Trademark Office released a new filing from BoA that outlines a new system that uses blockchain technology to help organize cash-handling services.

Specifically, the technology would eliminate the need to transfer large physical sums of cash and enable more transaction volume on devices like ATMs.

For now, though, it's unclear if BoA has begun building its newly released plans or if it is holding off.

BITS

But wait, there's more...

📈 BitMEX CEO Arthur Hayes believes Ethereum 'will quickly test $200' when the ICO market returns.
😦 Bitmain confirmed the layoffs stemming from redundancies in operations.
🇮🇳 A new report says that India may legalize cryptocurrencies but under strict rules.

MEME