Crypto Chronicle with NewsCrypto
Good morning NewsCrypto readers!
As banks face their own version of a financial horror story with mounting losses and a customer exodus, a hero in the form of a new, hot asset emerges for retail investors. It’s offering a glimmer of stability in these uncertain times.
Let’s not waste any more time and jump right in!
Here's what we got on the menu today:
1. Tesla Still Holds Bitcoin!
2. New Asset That Hooked the Retail Investors
3. Funny meme
Tesla Still Holds Bitcoin!
Tesla's love affair with Bitcoin remains strong. For the fifth quarter running, the electric vehicle behemoth hasn't budged its Bitcoin holdings. As of September 30, 2023, they're clutching onto a cool $184 million in Bitcoin, a fragment of the initial $1.5 billion Bitcoin buy in March 2021.
Their last major sale? Q2 2022, offloading about 75% of their holdings for a tidy $936 million.
AI Ambitioons: Full Throttle Ahead
While Bitcoin remains static, Tesla's AI ambitions are in overdrive. The company has "more than doubled" its AI computing power, even commissioning one of the world's mightiest supercomputers to supercharge its AI endeavors.
Elon Musk's Ambitions for the Future
With a steadfast Bitcoin stance and surging AI investments, Tesla's trajectory is clear. Add X on top of all of that and the picture about Elon Musk’s bet on the future of tech and finance becomes clear.
Don’t forget Tesla made a statement that it would accept Bitcoin as payment once miners are using at least 50% of green energy. As you can see on the chart below, we are currently slightly above that.
This could result in a surge of Tesla’s BTC holdings as they would most likely just hold the earned Bitcoin instead of instantly selling it on the market. On top of that, they can buy even more Bitcoin. Since we are in the “pre-bull run” period this could be a great opportunity for Musk to magnify the profits of his company.
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New Asset That Hooked the Retail Investors
Ah, the good old days of Y2K bug paranoia and Destiny's Child hits. Treasury bonds (t-bills) are giving us a financial flashback with their soaring 5.5% yields. But while t-bills are enjoying their moment in the sun, bank depositors are left in the shade, receiving a paltry average yield of 0.45%.
Trading Platforms Stepping Up
Modern trading platforms, especially the likes of Public, are reshaping the investment landscape. They're introducing retail investors to the allure of short-term Treasury products. Since their introduction in March, Treasuries have skyrocketed in popularity on these platforms, even outpacing some heavyweights in the S&P 500.
There's a broader shift in the wind. Money-market funds, which are known for their low-risk, short-duration instruments (including the beloved Treasuries), have seen an influx of over $880bn this year.
Their total valuation now stands at a jaw-dropping $5.7trn. Their main draw? A blend of safety and liquidity that's proving irresistible to many.
Traditional banks, with their often underwhelming interest rates, are facing a problem. As platforms make it a breeze to transfer funds into short-dated government debt, banks might need to rethink their strategy or risk being left behind.
RWA in DeFi
Now, here's where it gets spicy for us, crypto enthusiasts. With the undeniable popularity of treasuries, the integration of RWA (real world assets) into DeFi could be monumental. Imagine a world where treasury bills, currently one of the most sought-after assets, become a cornerstone in the DeFi space. It's a tempting prospect that could redefine the boundaries of decentralized finance.
Not only that, Tether is already investing in treasuries but instead of distributing the yield to their holder they instead keep it for themselves. Just in Q2 Tether made over $1 billion for doing NOTHING.
Imagine if you could get up to 5% on your USDT just because you hold it. It doesn’t seem like a lot, for every $100 you get $5 per year, but imagine holding $100 million in USDT - easy risk-free $5 million profits. This will be especially valuable in bear markets.