Copper’s Weekly Dispatch – 9 November 2021

Analysing what went right, and what went wrong, in this week’s Crypto Weekly Dispatch

Copper

Moonvember certainly came into fruition as digital assets crossed the $3T market cap milestone for the first time.

BTC, ETH, SOL and AVAX all reached new highs this past week. Meanwhile, new revelations from Tim Cook, and rumours that the SEC may allow Grayscale Investments to convert its flagship bitcoin trust to an ETF has led to further excitement around crypto mainstreaming.

Elsewhere, OpenSea, a leading marketplace that Andreesen Horowitz recently described as ‘the Amazon of non-fungible tokens’, continues to smash records. Yesterday, it surpassed $10bn in all-time trading volumes. To provide some perspective, the platform’s total volume for the entire 2020 was just $21m.

In a sign that the wider NFT market won’t be cooling down anytime soon, data from CBInsights reveals that funding for NFT companies in Q3 topped $1bn – up 6,000%+ year to date. Meanwhile, a new report from DappRadar shows that in Q3, the NFT industry generated a phenomenal $10.67bn in trading volumes – a 704% increase from Q2. Out of this, blockchain networks Ethereum and Ronin accounted for 77.7% and 19.53% of the numbers, respectively. Sure, NFTs may not be everyone’s cup of tea. But with the craze rapidly rewriting the rules of internet culture, and now expanding on networks other than Ethereum, institutional investors would be wise to continue watching this space closely.

Before jumping into the key headlines, a number of you may have seen yesterday that we launched our first TV commercial, starring Rebecca Ferguson. The ad was filmed shortly before the release of sci-fi epic Dune (now in a cinema near you) in which Rebecca features as Lady Jessica, alongside Timothee Chalamet, Zendaya, Javier Bardem, and Jason Momoa. For those of you who haven’t seen the commercial yet, check it out below. We hope you like it!

Cheers,

Iva Lila

Beneath the headlines

Tim Cook reveals that he owns crypto. Is this more than just another ‘mainstream endorsement’?

Apple CEO Tim Cook has caused a bit of a rumble on social media today after disclosing in an interview that he personally holds digital assets. Cook clarified that the investment was from a “personal point of view”, stating that he thinks crypto is “reasonable to own as part of a diversified portfolio”, and that “he’s been interested in it for a while”.

He also said that Apple is currently looking at crypto tech, but the world’s second most valuable company by market cap has no immediate plans to enable crypto functionality in Apple Pay. Nor does it have any immediate plans to accept cryptoassets for its products.

Meanwhile on NFTs, ‘Tim Apple’ (never forget!) said he finds the rapidly growing industry an “interesting” part of the overall sector.

The comments, which were made during a recorded interview at the New York Times DealBook conference, once again demonstrate that attitudes concerning digital assets continue to evolve toward greater acceptance. In the world of technology, Tim Cook is not only blue blood but also close to the top in reputation, meaning that his statements today will no doubt encourage others to consider allocating to crypto.

However, in the payments world, Apple has been a noticeable absentee on the ‘crypto support’ front. Since Q3 2020, pretty much all of the major payments companies (PayPal, Mastercard, Visa, Square and Venmo) have each made public their varying degrees of commitment to connecting the fiat and digital asset worlds. Earlier this year, Visa notably became the first major payments network to settle transactions in USDC over the Ethereum blockchain. Whereas Mastercard is believed to have a library of over 90 patents relating to CBDCs, as revealed by its former CEO, Ajay Banga, at a conference late last year.

Circling back to Apple, it could very well be the case that the company is gently warming to the idea of supporting digital assets… We certainly hope so. But what is certain is that once the company does finally throw its weight behind crypto, it would give the industry its strongest endorsement yet. In the meantime, we’ve said it before and pleased to see it echoed by Tim Cook today, incorporating digital assets in a diversified portfolio is reasonable, and fast becoming one of the most important asset allocation decisions.

NYC mayor-elect Eric Adams says he will take his first three paychecks in BTC. Why are politicians jumping on the trend to get paid in crypto?

On Thursday, New York City mayor-elect Eric Adams said via Twitter that he plans to take his first three mayoral paychecks in Bitcoin.

Adams’ tweet, as well as other similar announcements from Mayor Francis Suarez (Miami) and Mayor Jane Castor (Tampa), have sparked debate about whether politicians genuinely realise the value proposition of crypto, or if they see digital assets as a popular sector that could generate attention for their cities (and them personally). We have no idea. I guess no one really does. But, it is encouraging to see Adams and others sound a positive stance on our industry. This is a pretty stark contrast when compared to the tough approach from the likes of New York Attorney General, Letitia James, who recently launched a crackdown on unregistered cryptoasset companies.

In addition to plans of receiving his first three mayoral paychecks in the form of BTC, Adams is also pitching ‘NYC Coin,’ his city’s response to MiamiCoin. Most recently, he has also called for broader crypto education, saying he’d like schools to add cryptocurrency and blockchain technology to the curriculum.

Anecdotally, friends living in NYC have long lamented that the city is losing too much tech and crypto talent to Miami and Austin. The most recent example I’m aware of is Blockchain.com moving its headquarters from New York to Miami. So it certainly seems that what NYC actually needs right now are state officials who proactively look to welcome innovation.

I also find myself rather agreeing with Leah Wald, CEO of crypto asset manager, Valkyrie Funds, who recently made the following statement about the Democrat mayor-elect: “Adams is a savvy politician, and using an opportunity to promote a part of his agenda that has a rabid global following not only positions New York well for the future, it also instantly elevates his own profile.”

Anyway, I would love to hear your thoughts on this. Feel free to write to me here.

Roundup of other key developments

INSTITUTIONAL

LEGAL + REGULATORY + GOV + CBDCs

COMPANY

DeFi + WEB3 + NFTs + METAVERSE

What to watch out for this week

TUESDAY 9 NOVEMBER

Coinbase just reported its third quarter financial results. Although the exchange missed expectations in Q3, trading volume is still up 627% on the year. Some key numbers:

-$1.2bn generated in revenue

-255bn assets on the platform

-$327bn traded

-74m verified users

WEDNESDAY 10 NOVEMBER

DeFi-ing Expectations, an online event that convenes some of the industry’s key players to offer insights on emerging trends, products and applications tailored to the unique needs of institutional players, takes place. Our Head of Sales – Americas, Glenn Barber, will be participating in a panel discussion looking at regulation with speakers from Merkle Science, Global DCA and A100X Ventures. For more details and the full agenda, click here.

THURSDAY 11 NOVEMBER

-Major bitcoin mining company and bitcoin holder, Marathon Digital Holdings, is expected to announce its earnings.

-At 12:00pm ET, our CRO, Boris Bohrer-Bilowitzki will be speaking on a Blockworks webinar looking at settlement and counterparty risk with Nickel Digital’s Michael Hall, and James Slazas – CEO of Vaultlink and DARMA Capital. Full details here.

-Polkadot parachain auction. Click here for details.

FRIDAY 12 NOVEMBER

25 AYU members from the world of crypto will join the Copper team at The Royal Berkshire Shooting School (Reading, UK), for a day’s clay pigeon shooting and networking. This event is free for AYU members. Not yet a member? Apply here.

SUNDAY 14 NOVEMBER

Taproot, the most significant upgrade to the Bitcoin network since the SegWit upgrade of 2017, is due to take effect. For anyone who is a little bit confused about the upgrade, I wrote a (non-technical) article back in June unpacking its significance and the far-reaching benefits it will bring to the Bitcoin ecosystem. Read it here.

MONDAY 15 NOVEMBER

-Day one of Blockworks’ Digital Asset Summit – the institutionally focused crypto conference for asset managers and financial services professionals. The event takes place in London, and there’s still time to buy tickets.

-Copper x DAS networking drinks at Nest, the Treehouse Hotel. For any queries, please contact Lucia Camarillo.

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