The first week of July has been exciting for the blockchain and cryptocurrency world. Perhaps the biggest news is that a key UK financial watchdog plans to outlaw cryptocurrency-based derivatives in order to protect investors from financial harm. In a press release published Wednesday, the Financial Conduct Authority announced it is consulting an outright prohibition on the "sale, marketing and distribution to all retail consumers" of derivatives including CFDs, options, and futures, as well as exchange-traded notes linked to "unregulated transferable crypto assets" by firms operating or based in the UK. The regulatory agency said it believes such financial products are badly risky for unsophisticated retail investors. The FCA added it expects to publish its final guidance on crypto assets report later this summer.
Here is the rest of the week in review:
BTG Pactual, Brazil's fifth largest bank and largest investment bank, will use the Tezos (XTZ) blockchain for security token offerings potentially worth $1 billion. BTG is partnering with Dubai-based asset manager Dalma Capital. In a press release Wednesday, the two firms said they would utilize the Tezos network for the sale of digital securities to address a $1 billion market opportunity. Dalma Capital has joined the effort as joint underwriter for the ReitBZ tokenized property offering, and further expects to use Tezos for other asset tokenization projects from real estate to sports clubs. Tim Draper, CEO of Draper Associates, which holds a stake in Tezos, said he is excited to see the two firms cooperate to make use of the Tezos blockchain for security tokens.
Cuba announced it is considering the use of cryptocurrency in order to bolster its public finances. According to a report, the country's government announced on state-run TV that it would potentially use crypto as part of a package aimed to boost incomes of Cubans and assist with market reforms. The move is possibly influenced by Venezuela, an ally of the communist nation, which launched its own petro cryptocurrency early last year. Cuba is similarly suffering under US economic sanctions. In the TV announcement, Cuban President Miguel Diaz-Canel suggested that the cryptocurrency plan will try to raise national production and demand in order to boost growth. It is unclear if Cuba will launch its own token or use existing coins. Firms assisting the Cuban project in avoiding sanctions could get into trouble with the US government.
Crypto prices enjoyed a week of wild swings, closing slightly positive at just over $324 billion on Sunday. For the majors, all except Tether (USDT) posted losses, with Litecoin (LTC), Cardano (ADA), and Tron (TRX) being the most in the red. In the top 100, the biggest losers were Aurora (AOA), down 20%, VestChain (VEST), down 20%, and VeChain (VET), down 13%. The biggest winners were Waltonchain (WTC), up a whopping 87%, NEXT (NET), up 44%, and Quant (QNT), up 40%. Next week traders will watch if Bitcoin (BTC) and Ethereum (ETH) can rebound.
The author owns a small amount of BTC and LTC.