Gold is winning bonds, stocks and maybe Bitcoin: What to invest?

Gold is winning bonds, stocks and maybe Bitcoin: What to invest?

The global financial markets are grappling with a sharp retreat in risk sentiment, driven by escalating tensions between the US administration and the Federal Reserve, alongside uncertainties surrounding trade policies and tariffs. President Donald Trump’s latest social media salvo, urging Federal Reserve Chairman Jerome Powell to slash interest rates due to “virtually no inflation,” has reignited concerns about the central bank’s independence.

Trump’s pointed criticism, accusing Powell of being “too late” except during the election period, has rattled investors, leading to a broad sell-off in US assets on Monday. The S&P 500 plummeted 2.4 per cent, with the so-called Magnificent Seven—comprising tech giants like Apple, Microsoft, and Nvidia—underperforming the broader index with a 3.2 per cent decline.

Meanwhile, the US Treasury yield curve steepened, with front-end yields dipping and long-end yields climbing, reflecting shifting expectations about monetary policy and economic growth. The US Dollar Index slid 0.9 per cent to 98.38, its lowest in three years, while commodities displayed mixed responses: Brent crude fell 2.5 per cent amid risk-off sentiment, and gold surged 2.9 per cent to a record high above US$3,400 per ounce as investors sought safe-haven assets.

In Asia, China’s commerce ministry issued a stern warning against nations striking trade deals with the US at its expense, promising “resolute and reciprocal” countermeasures, further clouding the global trade outlook. Against this backdrop, Bitcoin’s remarkable surge past US$87,700 has captured attention, fuelled by a weakening dollar, speculation around US Treasury buybacks, and growing institutional interest. As markets navigate these turbulent waters, the interplay of macroeconomic forces, geopolitical tensions, and cryptocurrency dynamics is shaping a complex landscape for investors.

The friction between the White House and the Federal Reserve is a central driver of the current market unease. Trump’s public demands for lower interest rates, coupled with his pointed attacks on Powell, have raised alarms about potential political interference in monetary policy. The Federal Reserve’s independence is a cornerstone of its credibility, allowing it to make data-driven decisions to balance inflation and growth without succumbing to short-term political pressures.

However, Trump’s rhetoric, including threats to influence or even replace Powell, has sparked fears that this independence could be eroded. Such concerns are not merely academic; they have tangible market implications. Investors rely on the Fed’s predictability and autonomy to anchor expectations about interest rates and economic stability. Any perceived threat to this framework can trigger volatility, as seen in Monday’s sharp declines across US equity markets.

The S&P 500’s 2.4 per cent drop reflects a broader reassessment of risk, with the Magnificent Seven’s steeper 3.2 per cent decline signalling particular vulnerability in high-valuation tech stocks, which have been market darlings in recent years. These companies, heavily weighted in major indices, are sensitive to shifts in interest rate expectations and economic uncertainty, both of which are now amplified by the Fed-White House clash.

The US Treasuries market provides further insight into investor sentiment. The yield curve’s steepening—characterised by a 3.6 basis point drop in the 2-year yield to 3.762 per cent and an 8.6 basis point rise in the 10-year yield to 4.410 per cent—suggests a divergence in expectations for short-term and long-term economic conditions.

The decline in front-end yields indicates that some investors anticipate the Fed may resist immediate rate cuts, possibly due to inflationary pressures from tariffs or other policy shifts. Conversely, the uptick in long-end yields reflects concerns about sustained economic growth and potential inflation, particularly if trade disruptions intensify. This steepening curve is a classic signal of market unease, as it implies that investors are demanding higher compensation for holding longer-dated debt amid uncertainty.

The US Dollar Index’s slide to a three-year low of 98.38 underscores the broader retreat from US assets, as a weaker dollar often accompanies diminished confidence in US economic leadership or policy coherence. This dynamic has also bolstered gold’s appeal, with its 2.9 per cent surge to above US$3,400 per ounce reflecting a flight to safety amid geopolitical and economic turbulence.

Commodities markets are equally telling. Brent crude’s 2.5 per cent decline to US$66.26 per barrel highlights the risk-off sentiment gripping investors, as fears of a global economic slowdown—potentially exacerbated by trade wars—dampen demand expectations for oil. China’s commerce ministry’s vow to counter any trade deals that disadvantage Beijing has heightened these concerns, signalling that the US-China trade rift could deepen.

The ministry’s statement, promising “resolute and reciprocal” measures, suggests that retaliatory tariffs or other trade barriers are on the horizon, which could further disrupt global supply chains and economic growth. Asian equity indices, which initially gained but later reversed course, reflect the region’s sensitivity to these developments, given China’s pivotal role in global trade. The interplay of these factors underscores the interconnectedness of global markets, where US policy decisions reverberate far beyond its borders.

Amid this macroeconomic turmoil, Bitcoin’s meteoric rise stands out as a counterpoint, driven by a confluence of factors that highlight its growing role as an alternative asset. The cryptocurrency briefly surpassed US$87,700, buoyed by a weakening US dollar and speculation about US Treasury buybacks. Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom, has framed these buybacks as a potential “bazooka” for Bitcoin’s price, arguing that they could inject significant liquidity into financial markets.

By repurchasing its own debt, the Treasury could effectively ease monetary conditions, even if the Fed maintains its current stance on interest rates. This liquidity influx could amplify demand for risk assets like Bitcoin, which thrives in environments of monetary expansion. Hayes’ prediction that this may be the “last chance” to buy Bitcoin below US$100,000 reflects his bullish outlook, grounded in the belief that structural shifts in monetary policy and market dynamics are aligning in Bitcoin’s favor.

Adding to this narrative is a new analysis linking Bitcoin’s price movements to the global M2 money supply, a broad measure of money circulating in the economy. This predictive offset model suggests that Bitcoin’s trajectory closely tracks global liquidity trends, with historical patterns indicating a potential climb above US$100,000 if current conditions persist.

Such analyses resonate with investors who view Bitcoin as a hedge against currency debasement and inflationary policies, particularly in an era of unprecedented government spending and debt issuance. The weakening US dollar, down 0.9 per cent on Monday, further enhances Bitcoin’s appeal, as a depreciating currency often drives demand for assets perceived as stores of value. Gold’s concurrent surge underscores this trend, as both assets benefit from safe-haven flows amid uncertainty.

Institutional adoption is another critical driver of Bitcoin’s rally. Fidelity and Bitwise’s recent US$133 million investment in Bitcoin signals robust confidence from major players, whose involvement often lends legitimacy and liquidity to the cryptocurrency market. Similarly, BlackRock’s Bitcoin ETF reported a US$41.6 million daily inflow, reflecting heightened investor interest. These inflows are significant not only for their size but also for their symbolic weight, as institutional participation tends to stabilise and amplify Bitcoin’s price movements.

The growing acceptance of Bitcoin ETFs, as evidenced by data from platforms like farside.co.uk, suggests that traditional investors are increasingly comfortable allocating capital to cryptocurrencies, viewing them as a diversification tool in volatile markets. This trend could have lasting implications, potentially smoothing Bitcoin’s historically wild price swings while attracting a broader investor base.

From my angle, the current market environment is a crucible of competing forces, where traditional assets are buffeted by policy uncertainties, and alternative assets like Bitcoin are seizing the moment. The tensions between the US administration and the Federal Reserve are a stark reminder of the delicate balance between political ambition and economic stability.

Trump’s push for lower interest rates, while politically expedient, risks undermining the Fed’s credibility and could lead to longer-term inflationary pressures, particularly if tariffs disrupt global trade. The market’s reaction—evident in the S&P 500’s decline, the dollar’s weakness, and gold’s surge—reflects a rational response to these risks, as investors recalibrate their expectations for growth and stability.

Bitcoin’s ascent, meanwhile, is both a symptom and a signal of deeper shifts. Its correlation with global liquidity trends, as highlighted by the M2 analysis, suggests that it is increasingly integrated into the broader financial system, no longer a fringe asset but a barometer of monetary conditions.

The involvement of institutions like Fidelity, Bitwise, and BlackRock reinforces this view, pointing to a future where cryptocurrencies play a central role in portfolio construction. However, Bitcoin’s volatility remains a double-edged sword; while it offers outsized returns in bullish phases, its susceptibility to sharp corrections warrants caution.

Looking ahead, the interplay of US monetary policy, trade dynamics, and cryptocurrency adoption will shape the investment landscape. Investors must navigate a world where traditional safe havens like Treasuries are under pressure, and alternative assets are gaining prominence.

The US equity markets’ implied higher open today suggests a potential rebound, but sustained recovery will hinge on clarity around Fed policy and trade negotiations. For now, the markets remain on edge, caught between the promise of innovation and the perils of uncertainty.

 

Source: https://e27.co/gold-is-winning-bonds-stocks-and-maybe-bitcoin-what-to-invest-20250422/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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Crypto Staking is not Securities, Maybe ‘Steaking’ Is

Crypto Staking is not Securities, Maybe ‘Steaking’ Is

There is a debate over whether crypto-staking products are considered securities or not.

Brian Armstrong, the CEO of Coinbase, has defended the company’s staking product and said in a Bloomberg interview that it is not a security. Armstrong also mentioned that customers never turn their assets to Coinbase and that staking is not a security under the U.S. Securities Act or the Howey Test used by the Securities and Exchange Commission (SEC) to determine whether an investment contract is a security.

However, Coinbase has reportedly received investigative subpoenas from the SEC regarding staking, stablecoin, and yield-generating products. Nonetheless, Coinbase’s chief legal officer asserts that the staking service is different and is not a security.

Crypto staking refers to the process of holding a certain amount of cryptocurrency to participate in the validation of transactions and earn rewards in return. It is a process by which an individual can hold and lock up their cryptocurrencies in a wallet or other digital platform, and participate in the consensus mechanism of a blockchain network in order to earn rewards. The consensus mechanism used in staking is typically proof of stake (PoS), which enables validators to be chosen based on the number of coins they hold and have locked up in their wallets.

Validators are then responsible for creating new blocks and verifying transactions on the network. In return for their participation, validators earn a percentage of the block rewards in the form of additional cryptocurrency. Staking is seen as a way to help secure a blockchain network, as it incentivizes users to hold onto their coins and participate in the network’s governance.

Staking on centralized exchanges can come with risks. Centralized exchanges control the staked assets and may not always distribute rewards fairly. Moreover, centralized exchanges are more susceptible to hacks and security breaches, which can result in the loss of staked assets.

In February, the SEC cracked down on cryptocurrency firms and centralized exchanges. The SEC aims to protect investors by enforcing securities laws, imposing fines, and promoting transparency. Kraken, a cryptocurrency exchange platform, has paid a $30 million settlement to the SEC after being charged with violating securities rules by offering an unregistered securities program known as staking. The SEC claimed that Kraken marketed the staking platform as an investment opportunity and generated nearly $15 million in net income from U.S.-based users on revenue of $45.2 million.

As a result of the settlement, Kraken has ceased offering staking programs in the U.S. The company has also agreed to pay $30 million in disgorgement, prejudgment interest, and civil penalties as part of the settlement. The settlement highlights the need for companies to comply with securities regulations and register their staking services as securities offerings with the SEC.

One question that often arises in relation to staking is whether it is considered a security under U.S. securities law.

According to Coinbase, staking is not considered a security under the U.S. Securities Act or the Howey Test, which the SEC uses to determine whether an investment contract is a security. The Howey Test, which comes from a 1946 U.S. Supreme Court case, requires that an investment contract involve; an investment of money; in a common enterprise; with an expectation of profits; and, solely from the efforts of others. A transaction qualifies as an investment contract if it meets all four elements. Staking, however, fails to satisfy any of these prongs.

Firstly, staking does not qualify as an investment of money as customers do not give up any assets to receive staking rewards. The provision of staking services does not involve the exchange of assets or the transfer of ownership. Customers retain full ownership of their tokens and can unstake them at any time.

Secondly, staking does not meet the common enterprise prong of the Howey Test. Stakers on a blockchain network are not connected through a common enterprise or a central authority. Instead, they are part of a decentralized network that relies on consensus mechanisms to validate transactions. Stakers do not share profits or losses and are not part of a joint venture.

Thirdly, staking does not meet the reasonable expectation of profits element of the Howey Test. While stakers earn rewards for validating transactions, these rewards are not considered profits. The rewards are predetermined by the blockchain protocol and are not influenced by market conditions or the actions of service providers. Stakers do not have an expectation of profits beyond the rewards for validation services.

Finally, staking does not involve the efforts of others, a requirement under the Howey Test. Service providers offering staking services do not perform managerial or entrepreneurial activities. Instead, they provide tech services that allow customers to participate in the validation process. Service providers do not influence the rewards or the decision-making process on the blockchain network.

In the case of staking as mentioned above, the customers hold and control their assets and participate in the network’s validation process, which is considered an essential function of the cryptocurrency system. Thus, the SEC’s definition of a security does not apply to staking, as the rewards earned through staking are considered an inherent feature of the cryptocurrency network rather than solely from the efforts of others.

It’s important to note that the SEC has recently been cracking down on cryptocurrency-related activities, including crypto lending and staking and it is possible that their interpretation of the U.S. Securities Act could change in the future. Other countries may have different regulatory frameworks, so it is essential to be aware of local regulations and seek professional advice when engaging in cryptocurrency activities.

New York Attorney General Letitia James filed a lawsuit against KuCoin, a Seychelles-based cryptocurrency exchange, for allegedly violating securities laws by offering tokens that meet the criteria for securities without registering with the attorney general’s office. The lawsuit also alleges that KuCoin misrepresented itself as an exchange and lacked registration for that function as well. The lawsuit claims that this is the first time a regulator has claimed Ether is a security in court. The lawsuit specifically cites SEC v. Ripple as a precedent.

As an alternative, some investors may prefer decentralized exchange (DEX) platforms for staking, as they offer greater privacy, lower fees, and operate on a peer-to-peer network method. Crypto staking on a centralized exchange involves depositing and holding crypto assets to participate in staking activities, but it comes with risks and regulatory scrutiny. Investors should weigh the pros and cons and consider alternative options such as DEX platforms. I want to see what the SEC can do with decentralized exchanges and its series of Defi products.

I tend to agree with Gary Gensler when he said, “What does steak have to do with our securities law?”

 

Source: https://intpolicydigest.org/crypto-staking-is-not-securities-maybe-steaking-is/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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Bet on the Black? Take a punt on the Red? Or maybe put it all down on an NFT?

Bet on the Black? Take a punt on the Red? Or maybe put it all down on an NFT?

The global non-fungible token (NFT) market capitalization has dropped by 37.7% from its record high reached last year, but the Forkast NFT 500 Index suggests there is more to this market than the standard supply and demand dynamics behind rising and falling prices.

According to data tracked by analytics firm NFTGO, the NFT market peaked at US$36 billion in April 2022, US$14 billion more than today’s US$22 billion.

Over the same period, the Forkast 500 NFT Index, a newly launched performance measure of the global NFT market based on 500 smart contracts, plunged 84.71%.

The Forkast 500’s nosedive implies that if traders diversified their NFT portfolio and invested in the top 500 projects in the industry, they would be “rekt” – a crypto industry euphemism to describe heavy losses. According to Yehudah Petscher, a strategist at Forkast.News data partner CryptoSlam, NFT investors have adopted a casino-like trading behavior where they need to constantly move their funds to the “next hot project” to be successful.

“Liquidity gets recycled by savvy traders who frequently sell their NFTs, and use the funds to buy into new projects. From there, that same trader is looking to exit quickly and continue the cycle over and over again,” Petscher told Forkast.

House rules

Colin Johnson, chief executive of blockchain-based fine art investment platform Freeport, says that not all NFT traders may have been “rekt” as much as the Forkast 500 indicates.

“A well-diversified NFT trader will generally have another bag to work from. If they went all in on, say Moonbirds last May, they’re likely reeling and wanting some time away from crypto,” said Johnson.

Moonbirds, an Ethereum-based NFT collection that rewards investors for holding the assets longer, had a record-high floor price, or the lowest sale price of an NFT in a collection, of 25.5 ETH (US$39,142) on April 25, 2022, or a little over a week after its launch. It has since lost more than three quarters of its all-time high floor price and is currently priced at 5.6 ETH. The floor price represents the lowest price of an NFT within a collection.

While the casino rewards those that understand the rules of play, CryptoSlam’s data suggests that new buyers may be entering the game.

In February, the number of unique monthly buyers jumped to some 1 million addresses from 593,000 in January. February’s monthly customers tally was almost double that of the 529,000 sellers. On Feb. 26, daily unique NFT buyers rose to an all-time high of 166,000, following U.S.-based cryptocurrency exchange Coinbase’s free NFT airdrop.

“There is still large-scale activity from the top 1% of traders — recently to collect airdrops from new platforms like Blur,” Johnson said. “Most NFT collectors who are outside of that top 1% are very likely deep in the red.”

Blue chip cash

Much like cryptocurrencies, the high volatility of NFT prices poses challenges to estimating investors’ losses over a certain period of time.

“Holding a blue-chip NFT generally assures the owner that the NFT holds some inherent value,”  Anndy Lian, author of the book “NFT: From Zero to Hero,” told Forkast.

Bored Ape Yacht Club, the second-largest NFT collection by historic sales volume after play-to-earn game Axie Infinity, had a floor price of 63 ETH (US$96,705) on Thursday, a 27% drop from 90 ETH on April 2 last year, when the NFT market cap was at its highest.

Mutant Ape Yacht Club, the fourth-largest, fell 14% to 14.4 ETH.

“The top collections are primarily controlled by a small number of large-scale collectors. Average collectors’ wallets are in much worse shape this year than last,” added Johnson.

Petscher elaborated in the March 3 issue of CryptoSlam’s newsletter.

So how much in losses did a general NFT trader make as the digital assets markets tumbled from all-time highs?

“As a trader myself, I can tell you it’s much closer to 84%,” said Petscher.

 

 

Source: https://forkast.news/nft-casino-forkast-500-black-red/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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