This week in crypto: Mar 23-29
Tesla accepts bitcoin, NFTs hit SNL, and U.S. plots “digital dollar” — all that and more in our latest report.
Published on March 29, 2021
The big picture
You can now buy Teslas with Bitcoin. Founder Elon Musk also said that the company is operating its own Bitcoin nodes (meaning that Tesla is actively participating in the decentralized network of computers running Bitcoin’s protocol) and that Bitcoin obtained via Tesla sales will be held rather than converted to fiat currency. The news followed Tesla’s February announcement (via SEC filing) that it had acquired $1.5 billion in Bitcoin.
Shark Tank entrepreneur and Dallas Mavericks owner Mark Cuban — a vocal supporter of new crypto applications including DeFi and NFTs — announced the launch of digital art gallery called Lazy.com. “People bought NFTs, they created them, they need a lazy way to show them off,” Cuban said. “There really was not an easy way to do it before Lazy.com.”
Looking for a simple explanation of NFTs? We have you covered. Looking for a more absurdist take? Check out Pete Davidson and Chris Redd’s new Saturday Night Live sketch with musical guest Jack Harlow.
Some of the biggest names in traditional media are experimenting with the NFT craze. A recent New York Times tech column was tokenized as an NFT that sold for 350 ETH (around $560,000 at the time of sale). Time Magazine also sold a series of NFT covers for nearly half a million dollars. (The news magazine — which is owned by Salesforce billionaire Marc Benioff — is also seeking a CFO that is “comfortable with Bitcoin.”)
Dawn Fitzpatrick, chief investment officer at hedge giant Soros Investment Fund, says that Bitcoin is at an “inflection point.” The fund is pursuing investments in crypto infrastructure — including participating in crypto-data provider Lukka’s recent $53 million Series D round. “Bitcoin might have stayed a fringe asset, but for the fact that in the last 12 months we’ve increased money supply in the US by 25 percent,” Fitzpatrick said. “So there’s a real fear of debasing of fiat currencies.”
Visa, one of the world’s largest payment networks, announced that it will now enable the use of USD Coin (a stablecoin largely operating on the Ethereum blockchain) to settle payments. "We see increasing demand from consumers across the world to be able to access, hold and use digital currencies and we're seeing demand from our clients to be able to build products that provide that access for consumers," said Cuy Sheffield, head of crypto at Visa. Learn more about USDC and stablecoins here.
U.S. begins to pursue digital dollar project
The boom in cryptocurrencies over the last year has pushed central banks around the world to work on digital versions of fiat currencies. According to Bloomberg, the U.S. has begun research into creating a digital dollar, with researchers from the Federal Reserve Bank of Boston and MIT preparing to demonstrate a prototype digital-dollar platform as soon as July: “The fire has been lit, ” said Josh Lipsky, director of the GeoEconomics Center at the Atlantic Council. “The world is moving very quickly on these projects.”
Curious about which countries are pursuing a digital currency of their own? The Belfer Center, part of the Harvard’s Kennedy School of Government, has been tracking them:
Bitcoin booms in developing economies
Millions of workers around the world are now using Bitcoin as a way of sending money across borders — often in the form of remittances to relatives back home. In Nigeria, Africa’s largest economy, the central bank is so concerned about crypto’s popularity that it has been offering to pay citizens who live overseas to use traditional channels for transfers.
As Quartz reports: “the minimal transaction costs of cryptocurrency exchanges beat exorbitant transaction fees of traditional money wire companies like Western Union and MoneyGram, whose dominance of the remittances market has long troubled international development institutions concerned with economic growth.”
Remittance payments are one of the most promising use-cases for crypto due to low fees and near-instantaneous payments. As referenced in our special report on Bitcoin’s bull run, according to a global survey of internet users Nigeria has one of the highest rates of crypto adoption: