Central Banks go big on Crypto

The cryptocurrency market showed small gains over the weekend, but then displayed a slight correction over the past 24 hours. However, the correction was not as significant as some of the short-term drops seen in recent weeks, as the majority of top 10 cryptos showed price movements lower than 1%. Bitcoin also registered slight declines, still failing to overcome the $7,500 hurdle. Over the past week, there were some major developments surrounding the adoption of crypto by central banks, and this week, the connection between mainstream markets and crypto will once again be tested. 

This Week’s Highlights

  • Central Banks Test Crypto
  • Ethereum Hard Fork
  • The Week Ahead

Central Banks go Crypto

After being home to one of the largest crypto crackdowns in history last year, now, China continues to establish itself as a global leader when it comes to government adoption of digital currencies. This morning, it was announced that the People’s Bank of China will be testing the Digital Yuan before the end of the year, which is a major step forward in the process of global tokenization. However, China is far from alone in this race. Last Wednesday it was reported that France is also planning on testing its own digital currency next year, and on Friday, India joined the mix

Ethereum Goes to Istanbul

For the 8th time since it was created, the Ethereum blockchain yesterday underwent a hard fork, making its network backwards incompatible. The hard fork was relatively uneventful, as the majority of network users approved the change, preventing any split in the blockchain. The hard fork, dubbed ‘Istanbul,’ was intended to improve some of the Etherum blockchain’s features, including DDoS attack resilience and integration with other cryptos, such as ZCash. 

The Week Ahead

While still being considered separate markets, the lines between crypto and the mainstream are increasingly becoming blurrier. As apparent from last week’s central bank crypto frenzy, it is possible that in the near future, news about one will have a direct influence over the other. This week, no less than three major central banks (The Federal Reserve, Swiss National Bank and European Central Banks) will be announcing their interest rate decisions and outline some future monetary policy. In addition, each of the announcements will be accompanied by a press conference with a central bank chief, so it is possible that they will address the subject of crypto and blockchain directly. Regardless, these announcements often have an impact on each bank’s respective market and currency, which could in turn impact crypto — but that remains to be seen. 

eToro USA LLC; Virtual currencies are highly volatile. Your capital is at risk.