In this post, I’ll share our long term vision for Goldfinch. To explain it, though, we first need to talk about bigger trends at play. At the heart of everything we’re building is a much broader thesis we have about how the global economy is shifting.
Our thesis is made of two core beliefs. The first is that over the coming decade, decreasing bond yields will drive investors to demand new investment opportunities. The second is that over this same period, global economic activity will move on chain, making every transaction programmable.
Put these two beliefs together, and you might guess our conclusion: these investors will scramble to invest in these now-programmable, globally-accessible transactions. This will finance vast portions of the global economy, dramatically expanding access to capital. And we’ll need a protocol to do it — that’s what we’re building with Goldfinch.
I’ll dive into these beliefs more deeply, and then share how Goldfinch fits in.
Our first core belief is that depressed yields in traditional markets will drive investors to demand new sources of yield. This all starts with bond yields reaching their lowest levels — ever:
For over a century, bonds have served as a foundation of yield. This has created a fallback for passive capital that put pressure on other markets to beat those returns. But as bond rates hit zero and even turn negative, this will trigger a massive shift. Capital will look to other markets like stocks, inflating those asset prices and reducing yields across the board.
And yet, even as bond yields disappear, pockets of reliable returns remain. Private credit funds continue to post strong performance, often 8–10%+, driven by private deals with private companies. The catch is that it’s an insider’s game, and you need to be part of a tiny sliver of wealthy individuals and institutions to participate.
We think this can only last for so long. As yields diminish in public markets, the broader investor base will look elsewhere and demand access. One early sign of this is the increasing retail interest in stock markets. Another example is the craze around yield farming on DeFi over the past year. We think this is just the beginning of a much bigger trend.
Our second core belief is that global economic activity will migrate to crypto, making every transaction programmable. For many of us already deep in this space, that isn’t a novel idea. The expectation (or faith) that the world will eventually move to crypto is so ingrained in the industry that we sometimes take it for granted. But now it’s actually happening because consumers and businesses are beginning to view crypto as a hedge against monetary policy.
The obvious examples are companies like Tesla and Microstrategy recently purchasing bitcoin. However we’re also seeing it firsthand in our conversations with potential borrowers. In Nigeria, for example, we’re talking to three separate fintechs that are actively considering or building crypto accounts for their customers. One of them is even moving a portion of their own balance sheet to crypto as part of their treasury management.
The interesting part is that they aren’t doing it to speculate in crypto. Rather, it’s the opposite — they’re using crypto because they view it as safer and more stable than their local currency.
It’s also notable that this demand spans both consumers and merchants. Because as consumers start holding crypto and merchants start holding crypto, it’s inevitable they’ll start transacting with each other directly in crypto, too. And not just within their own country, but across borders. The network effects of this will be immense, and we believe it will be the catalyst for the global adoption of crypto-native commerce.
Take the transactions between consumers and merchants becoming openly programmable, and add to that a wave of demand from investors, and we have the kindling for a paradigm shift. This will lead to a new system where anyone is able to extend a loan for any transaction in the world.
It will be like open sourcing Visa’s payment rails. People will start receiving their income on chain and paying merchants on chain, and that will open up a much wider design space for how we can finance that activity. Imagine if it wasn’t just huge banks that could provide credit for these transactions, but anyone in the world, or even a smart contract.
To provide an example that extrapolates this to its extreme, consider someone who needs to get their bike fixed. A smart contract could send the capital directly to one of the on-chain-approved repair shops. And since that person receives their income on chain, they could permit that smart contract to take the repayment directly out of their paycheck.
The credit risk would be low — far lower than anything possible today — because the capital would be used for a verifiable purpose, by someone who has provable income, with a repayment mechanism that is automatically enforceable.
Given those assurances, someone on the other side of the world could feel comfortable funding that transaction even without intimate knowledge of the borrower. Or they could fund the strategy that handles many of those types of transactions. Or the system that handles many of those strategies. And tying it back to that wave of investors demanding new opportunities, many will line up to participate.
All of this will require a protocol to organize this new marketplace. That protocol, ultimately, is what we’re building with Goldfinch.
Our long term mission is to create an open credit platform that empowers financial inclusion. We believe that if we get the mechanics and economic incentives right, we can harness these two broader trends into a highly scalable system. It will allow many people all over the world to finance the economic activity of many other people all over the world, especially in places where the flow of capital has traditionally been inefficient.
It won’t happen overnight. We’re in it for the long haul. If you’re interested and want to help us get there, we’re actively hiring, or join our community on Discord.
JPMorgan analysts have predicted that the unlocking of GBTC shares could raise the selling pressure and drive the price of Bitcoin to the level of $25K. JPMorgan revealed in their latest memo that though BTC has recovered slightly, the unlock will drive the price down to $25K.
JPMorgan Says GBTC Shares Unlocking Will Push Bitcoin Down Further
The Nikolaos Panigirtzoglou led global investment bank JPMorgan has recently displayed a contentious attitude to the flagship currency.
The analysts at JPMorgan always have an eye on what role the largest crypto asset manager, Grayscale is playing in relation to Bitcoin.
At the beginning of this year, the analysts predicted that there are chances that the price of BTC might march towards a correction as a reduction in the inflows to the Grayscale Bitcoin Trust has been witnessed.
As revealed in the newly released memo by Bloomberg, JPMorgan has predicted another bear signal in the market involving GBTC, talking about the shares unlock of the BTC tracking fund.
The institutional investors that are employing the services of Grayscale will be obtaining access to 16K bitcoins in a single day in the month of July.
Will BTC Touch $25K
Bitcoin plunged to its lowest price levels just days ago below the area of $29K, though it managed to acquire some ground since that point and at present, it is changing hands at $32K.
JPMorgan analysts are eyeing another fall in the price of Bitcoin, and they wrote:
“Despite this week’s correction, we are reluctant to abandon our negative outlook for Bitcoin and crypto markets more generally. Despite some improvement, our signals remain overall bearish.”
In addition to this, they revealed that they believe the price of BTC is close to being overvalued, which is apparent from the comparison between its fluctuations versus that of gold.
The number of active Bitcoin addresses seems to have dropped significantly below 900,000 in June 2021 which is the lowest level since July 2020, according to data published by Santiment, the crypto analytics platform.
Active Bitcoin Addresses Drops Since July 2020
Amid the ongoing bearish market trend, Bitcoin traders remain hesitant to pumping up their bags as the digital asset dropped below $30,000 during this week. Since then, the cryptocurrency has recovered some of its lost gains to jumping up above $34,000.
However, bears are back to gripping the flagship cryptocurrency yet again by making the digital asset drop down below $32,500 today.
With the bearish sentiments, the total number of active Bitcoin addresses has reached below 900,000 in June 2021, which is the lowest level since July 2020, according to data published by Santiment, the crypto analytics platform, adding:
“Bitcoin is back at $32.4k after a rebound above a $34.6k high Wednesday. What remains to be seen is an uptick in address activity. On the 30-day rolling scale of daily active address scale, July 13, 2020, was the last time the BTC network was this low,”
At the same time, Bitcoin’s fear, uncertainty, and doubt (FUD) remain high as highlighted by Santiment:
“Bitcoin’s fear, uncertainty, and doubt (FUD) remain high, as traders are polarized on whether prices can push back below $30k again. For now, though, prices have jumped back on crowd fear. Markets move in the opposite direction of crowd expectation.”
The number of active Bitcoin addresses is a sign of market demand for on-chain transactions, settlement, and the urgency for inclusion in an upcoming block on the blockchain. A falling Bitcoin active address figure indicates a bearish undertone in the space.
For instance, in 2017, Bitcoin saw a high above $19,587 on December 16 to below $6900 on February 5, 2018, the number of active addresses also fell from 1.284 million on December 14, 2017, to just 528,000 on February 25, 2018.
At the same time, studies show that not all Bitcoin whales were affected by the price drop. In the past 25 days, Bitcoin addresses holding 100 to 10,000 BTC added a total of 90,000 BTC, accounting for nearly half of BTC’s circulating supply.
After a large loss, cryptocurrency markets rallied back yesterday, with Bitcoin and Ethereum up 15% and 17%, respectively, after a big decline. El Salvador’s president, Nayib Bukele, recently released rendered graphics of a planned Bitcoin mining unit that would be powered by the country’s active volcanoes (the thermal energy generated from volcanoes can be converted …
After a large loss, cryptocurrency markets rallied back yesterday, with Bitcoin and Ethereum up 15% and 17%, respectively, after a big decline. El Salvador’s president, Nayib Bukele, recently released rendered graphics of a planned Bitcoin mining unit that would be powered by the country’s active volcanoes (the thermal energy generated from volcanoes can be converted into electricity, and in turn be used to power mines).
Even though Major of the coins seem to have bounced back yesterday, the move did not last that long and bears took incharge once again.
Yesterday, however, as sellers sold into strength, prices retraced the whole rise. Traders took advantage of the majority of cryptocurrencies’ oversold circumstances. After the shakeout, which pushed Bitcoin’s price to over $30,000, buyers were active.
Bitcoin and Ethereum Price Levels
Bitcoin managed to recover off the $28,800 support and close the candle in a bullish ‘hammerhead’ pattern. (A hammer candlestick pattern is a form of bullish reversal pattern.) The next level of resistance is around $36,600. Unless the price increase is followed by a volume influx, a rejection in that area is possible.
After appearing to have bottomed out, the relative strength index (RSI) has also risen sharply. After yesterday’s dip, the positive buyback demonstrates the buyer’s interest in bitcoin.
However, the pricing remains to be in the $30,000 to $38,000 range.
The price of ETH stayed well above the 200MA and climbed back above $2,000 with ease. A daily close above $2,000 would be advantageous and might lead to good price movement in the days ahead.
The next point of resistance for ETH is around $2,100, where it is expected to be rejected. However, volume is minimal, and a volume push is needed to keep the price trend going.
Bitcoin (BTC) is on a “lower left to upper right trend” and its volatility should not scare investors, the former head of the New York Stock Exchange says.
In an interview with CNBC on June 23, Thomas Farley revealed long-term convictions about Bitcoin and dismissed concerns over BTC price losses.
Bitcoin: Going up, but not “up only”
Coming a day after CNBC pundit Jim Cramer admitted that he sold his Bitcoin stash, suggesting that BTC/USD was going as low as $10,000, Farley provided some much-needed mainstream bullishness.
“With respect to the recent price moves, I’m kind of sanguine about them — Bitcoin’s a very volatile asset class, in part because it’s a new asset class,” he told the network.
“I have no doubt it’ll go up, it’ll go down over the long term — I still think it’s a lower left to upper right trend and I think we’re going to see that play out over five years.”
With mining upheaval coming from China still on everyone’s lips, popular mainstream criticism of Bitcoin’s energy usage was also swiftly cast aside as a temporary issue.
“I think this kerfuffle is an interesting conversation, but by and large I think it’ll be resolved because I think the blockchain at its core adds to its efficiency and in fact will add to energy efficiency over time,” he continued.
Less convinced on gold. vs. Bitcoin
When it comes to Bitcoin as “digital gold,” however, Farley was more conservative in his predictions.
Now firmly beneath a trillion-dollar market cap, Bitcoin must transform in order to take on store-of-value safe-havens.
“I think the upper bound for now is gold, which is about a $10 trillion market cap,” he added.
“In order for Bitcoin to one day exceed gold, it’ll have to be more of an accepted form of currency — I’m not sure, frankly, if it ever gets there.”
Proponents argue that Bitcoin, by its very nature, faces just a matter of time before eclipsing gold thanks to the latter’s ultimately infinite supply and inability to beat Bitcoin in all aspects of “money.”
The precious metal saw a major sell-off last week after comments on policy from the United States Federal Reserve.
To beat gold, Bitcoin would need to trade at more than $533,000 with the current supply.