How traditional institutions operate a major shift towards blockchain and reshape Global Finance Introduction : How SWIFT and European banks are reshaping Global FinanceIn a dramatic shift that signals the convergence of traditional finance and decentralized technology, two major developments are redefining the future of global payments: SWIFT, the world’s leading financial messaging network, is building its own blockchain infrastructure, while a consortium of nine European banks is launching a regulated euro-denominated stablecoin. These moves mark a turning point in how legacy institutions are embracing blockchain—not as a threat, but as a tool to modernize, compete, and lead. SWIFT’s Blockchain pivot: Reinventing cross-border paymentsFor decades, SWIFT has been the backbone of international banking, facilitating trillions of dollars in cross-border transactions through its secure messaging system. But as the rise of stablecoins and tokenized assets challenges the status quo, SWIFT is responding with a bold initiative: the development of a blockchain-based shared ledger designed to streamline global payments.Announced in September 2025, SWIFT’s blockchain prototype aims to deliver real-time, 24/7 settlement capabilities, smart contract functionality, and full transparency on transaction speed and fees. The project is being developed in partnership with Consensys, a leading Ethereum-focused blockchain firm, and is supported by major financial institutions including Bank of America, Citigroup, and NatWest.Unlike public blockchains that operate outside regulatory frameworks, SWIFT’s ledger is designed to be permissioned and interoperable, allowing banks to integrate seamlessly with existing systems while benefiting from blockchain’s efficiency and security. The initiative builds on SWIFT’s earlier experiments with tokenized asset transfers and its collaboration with Chainlink to connect traditional finance with decentralized networks.Javier Pérez-Tasso, SWIFT’s CEO, emphasized the strategic importance of the project at the Sibos conference in Frankfurt: “We provide powerful and effective rails today and are moving at a rapid pace with our community to create the infrastructure stack of the future.”The goal is clear: to offer the speed and cost-effectiveness of stablecoins, but with the trust, compliance, and scale that banks and regulators demand. A Euro stablecoin for Europe’s digital sovereigntyWhile SWIFT is building the rails, a group of nine European banks is laying the foundation for a new digital currency. UniCredit, ING, Danske Bank, KBC, SEB, CaixaBank, Raiffeisen Bank International, DekaBank, and Banca Sella have joined forces to launch a euro-denominated stablecoin that complies with the EU’s Markets in Crypto-Assets Regulation (MiCAR).The stablecoin will be issued by a newly formed company based in the Netherlands, which is seeking licensing as an e-money institution under the supervision of the Dutch Central Bank. The first issuance is expected in late 2026, and the consortium is open to additional banks joining the initiative.This euro stablecoin is designed to serve as a regulated, trusted digital payment instrument that can be used for on-chain settlement, programmable finance, and cross-border transactions. It will operate 24/7, offering continuous access to settlement services and enabling near-instant, low-cost payments across Europe and beyond.The project is a direct response to the dominance of U.S.-based stablecoins such as Tether (USDT) and USD Coin (USDC), which currently account for the vast majority of stablecoin volume globally. By creating a euro alternative, European banks aim to bolster strategic autonomy and financial sovereignty in the digital economy.Fiona Melrose, Head of Group Strategy at UniCredit, highlighted the collaborative spirit of the initiative: “We are contributing to fill the need for a trusted, regulated solution for on-chain payments and settlement, paving the way for a new standard in the digital asset space.” Why these moves matter: The rise of Hybrid FinanceTogether, SWIFT’s blockchain and the euro stablecoin represent a broader trend: the rise of hybrid finance, where traditional banking infrastructure coexists and collaborates with decentralized technologies.This shift is driven by several key factors: • Regulatory clarity: The EU’s MiCAR framework and recent U.S. stablecoin legislation are providing the legal certainty needed for banks to innovate safely. • Market demand: Businesses and consumers increasingly expect real-time, low-cost, borderless payments—capabilities that blockchain delivers. • Technological maturity: Blockchain platforms have evolved to support scalable, secure, and interoperable solutions suitable for institutional use. • Strategic competition: With China advancing its digital yuan and U.S. firms dominating the stablecoin space, Europe and SWIFT are stepping up to ensure they remain competitive.These developments also reflect a philosophical shift. For years, blockchain was seen as a disruptive force that threatened banks. Today, it’s viewed as a transformative tool that can enhance trust, efficiency, and innovation in financial services. Challenges ahead: Integration, Adoption, and TrustDespite the promise, both initiatives face significant challenges.For SWIFT, the transition from messaging to settlement requires not just technical upgrades but a cultural shift among member banks. Ensuring interoperability with existing systems, maintaining compliance across jurisdictions, and managing risk in a decentralized environment will be complex.For the euro stablecoin, adoption will depend on trust, usability, and network effects. Convincing businesses and consumers to use a new digital currency—especially when alternatives like PayPal and USDC are already widely accepted—will require robust infrastructure, clear incentives, and strong regulatory backing.Moreover, both projects must navigate geopolitical tensions, cybersecurity risks, and the evolving landscape of central bank digital currencies (CBDCs), which could either complement or compete with their efforts. The road ahead: Building the future of FinanceDespite these hurdles, the momentum is undeniable. SWIFT’s blockchain and the euro stablecoin are not just experiments—they are strategic bets on the future of finance.They signal that traditional institutions are no longer content to watch from the sidelines. Instead, they are actively shaping the next generation of financial infrastructure, one that blends the reliability of legacy systems with the agility of blockchain.As these projects evolve, they could unlock new possibilities: • Tokenized securities settled in real time. • Smart contracts that automate trade finance and insurance. • Cross-border payroll and remittances with minimal fees. • Digital identity and compliance embedded into transactions.In this new landscape, banks are not just intermediaries—they are innovators, collaborators, and architects of a more inclusive, efficient, and transparent financial system. Conclusion: A new chapter for Global FinanceThe convergence of SWIFT’s blockchain and the euro stablecoin marks a watershed moment in
Prypco, Robinhood and developments in asset Tokenization
Prypco, Robinhood and Developments in Asset TokenizationRecent developments have highlighted two significant steps in the tokenisation of tangible assets.The first initiative is in real estate, sponsored by Damac, a major property developer in Dubai. PRYPCO Mint is the first tokenized real estate investment platform launched in the MENA region, allowing investors to purchase fractional shares of properties using blockchain-based tokens, with entry starting from AED 2,000. The platform operates under the supervision of the Dubai Land Department (DLD), Virtual Assets Regulatory Authority (VARA), and Zand Bank, which oversee transaction security and regulatory compliance.While other platforms such as Propy (founded in 2016, based in Palo Alto, USA) and MetaWealth (founded in 2022, Dublin, Ireland) offer blockchain-based real estate services and fractional ownership, PRYPCO Mint distinguishes itself as the first in the region to be validated and supervised by local regulatory bodies (Dubai Land Department and VARA). The first property listed via PRYPCO Mint was fully funded within one day, attracting 224 investors. Key features of PRYPCO Mint include: PRYPCO Mint utilizes the XRP Ledger (XRPL) due to its speed, security, and transparency, offering: The second initiative involves the online broker Robinhood, which has introduced a tokenization program enabling European users to trade over 200 U.S. stocks and ETFs as blockchain-based tokens. The available assets include prominent companies such as Apple, Nvidia, and Microsoft, along with exposure to private firms like OpenAI and SpaceX. Features of this service include: Robinhood issues these tokens primarily via the Arbitrum blockchain (a Layer 2 solution for Ethereum), and is developing its own Layer 2 blockchain optimized for real-world asset tokenization. Layer 2 solutions are designed to address Ethereum’s high transaction fees, lower speed, and scalability constraints. Types of Layer 2 solutions include: Arbitrum, developed by Offchain Labs, is widely used among Layer 2 solutions. It processes transactions off-chain and provides security by posting proofs back to Ethereum. Its features allow high throughput (up to 40,000 transactions per second), low fees, and compatibility with Ethereum smart contracts. Robinhood leverages Arbitrum’s Orbit Framework to build its proprietary blockchain for these purposes. Beyond Robinhood, Arbitrum supports DeFi applications like Uniswap and Aave, NFT marketplaces like Magic Eden, gaming platforms, and tokenized stocks. Layer 2s contribute to scaling blockchain platforms and facilitating broader access to decentralized finance (DeFi) and traditional finance (TradFi). Robinhood’s initiative aligns with its strategy to expand in Europe and provide broader investment access. Through blockchain, it aims to reduce settlement times, support fractional ownership, and enhance liquidity. Despite progress, some challenges remain. Token holders do not possess shareholder rights, including voting or legal claim to the underlying shares. Additionally, regulatory uncertainty persists across different jurisdictions, and users depend on Robinhood’s custody of shares, necessitating trust in the operator. Following the tokenization announcement, Robinhood’s stock ($HOOD) experienced an increase, reflecting market response to its adoption of blockchain technology in investing.
The rise of decentralized emerging payment and banking companies
IntroductionIn recent years, the financial sector has witnessed a significant shift, fueled by technological innovation and changing consumer expectations. Among these developments, the emergence of decentralized payment and banking companies stands out as a transformative force reshaping the landscape. These companies, powered by blockchain technology and innovative business models, are challenging traditional financial institutions and offering new solutions to address long-standing inefficiencies.This article explores the rise of decentralized payment and banking companies, their underlying technologies, and the factors driving their growth in the public domain. Understanding Decentralized Payment and Banking CompaniesAt their core, decentralized payment and banking companies aim to offer financial services without relying on traditional intermediaries like banks or payment processors. These companies leverage blockchain technology, a distributed ledger system that ensures transparency, security, and immutability in transactions.Unlike centralized financial institutions, decentralized companies operate on peer-to-peer networks, allowing users to interact directly with one another. This approach reduces costs, increases accessibility, and empowers individuals to have greater control over their financial activities.Key services provided by these companies include decentralized lending and borrowing, cryptocurrency payments, tokenized asset management, and smart contract-based transactions. Technological FoundationsThe infrastructure of decentralized emerging payment and banking companies is built on several technologies, with blockchain playing a central role. Here’s a closer look at the most prominent technologies: Factors Driving the Rise of Decentralized CompaniesSeveral factors have contributed to the growth of decentralized payment and banking companies in the public domain: Notable ExamplesThe rise of decentralized payment and banking companies is exemplified by several notable platforms and initiatives. These include: Challenges and RisksDespite their benefits, decentralized payment and banking companies face several challenges and risks: Future OutlookThe future of decentralized payment and banking companies looks promising. As technology continues to advance, scalability and efficiency will improve, addressing some of the current challenges. Regulatory frameworks are also expected to evolve, providing clearer guidelines for decentralized systems.Additionally, increased consumer awareness and adoption of cryptocurrencies will drive growth, positioning decentralized companies as a mainstream alternative to traditional financial institutions. Collaboration with existing banks and payment processors may further enhance their reach and impact. ConclusionThe rise of decentralized emerging payment and banking companies marks a new era in the financial sector. By leveraging blockchain technology and innovative infrastructures, these companies are addressing inefficiencies, promoting financial inclusion, and empowering individuals worldwide.While challenges remain, the potential for decentralized solutions to reshape the industry is undeniable. As these companies continue to gain traction in the public domain, their impact on the global economy will only grow stronger.
The rise of stablecoins in the Banking World
The rise of Stablecoins in the Banking World Stablecoins serve as a bridge between volatile cryptocurrencies like Bitcoin and Ethereum and the stable realm of fiat currencies. By being pegged to reserve assets such as national currencies or commodities like gold, stablecoins provide a consistent value that facilitates their use in transactions, investments, and as a store of value. Their promise of stability and efficiency has made them an attractive tool for both individuals and institutions. Banks and Financial Institutions, which have historically been cautious about adopting cryptocurrencies, are now stepping into the stablecoin arena. This shift marks a departure from the perception of cryptocurrencies as competitors to traditional finance, instead recognizing their potential as complementary innovations. Examples of bank-issued stablecoins Several major banks have already taken steps to create their own stablecoins, highlighting the growing interest in this area: • JPMorgan Chase: JPM Coin is used to facilitate institutional transactions and settlements, demonstrating the potential for efficiency gains within the banking sector. • MUFG: Mitsubishi UFJ Financial Group’s Coin is designed to streamline internal operations and enable seamless digital payments. • HSBC: The bank is exploring blockchain-based solutions that may include stablecoins, aiming to enhance its global payment network. These initiatives underscore the strategic importance of stablecoins in the modern banking landscape. Key motivations behind Banks and Financial Institutions creating stablecoins In recent years, stablecoins have emerged as a transformative innovation in the financial sector. These digital currencies, designed to maintain a stable value by being pegged to a reserve asset like a fiat currency, have become integral to the evolving landscape of global finance. Traditionally, stablecoins were the domain of decentralized cryptocurrency platforms, but a growing number of financial institutions worldwide are now creating their own stablecoins. This shift signals a significant change in how banks and other institutions perceive and utilize blockchain technology. Efficiency in transactions One of the most compelling reasons for financial institutions to develop their own stablecoins is the efficiency they bring to transactions. Traditional payment systems, especially for cross-border payments, are slow, expensive, and reliant on intermediaries. Stablecoins, powered by blockchain technology, allow for near-instantaneous and cost-effective transfers. This eliminates the need for multiple intermediaries, significantly reducing transaction fees and processing times. For example, JPMorgan Chase’s JPM Coin enables real-time settlements between institutional clients, showcasing the potential of stablecoins to modernize financial operations. Regulatory control Unlike decentralized stablecoins, which often operate outside traditional regulatory frameworks, stablecoins issued by financial institutions are inherently compliant with existing laws and regulations. Financial institutions can integrate anti-money laundering (AML) and know-your-customer (KYC) protocols directly into the design of their stablecoins. This ensures that the digital currencies are secure and transparent, meeting the stringent requirements of regulatory authorities. Stability and trust The inherent stability of stablecoins makes them a reliable medium of exchange, store of value, and unit of account. By pegging their stablecoins to fiat currencies or other stable assets, financial institutions offer customers a safe alternative to volatile cryptocurrencies. Additionally, the reputation and trustworthiness of established financial institutions lend further credibility to their stablecoins, encouraging adoption among users who might otherwise be skeptical of digital currencies. Bridging traditional and digital finance Financial institutions recognize the growing importance of digital finance and decentralized finance (DeFi) ecosystems. By issuing their own stablecoins, they can bridge the gap between traditional banking systems and emerging blockchain-based platforms. This allows institutions to participate in the digital economy while maintaining their relevance in a rapidly evolving financial landscape. Competitive edge In an increasingly competitive financial environment, institutions are under pressure to innovate and differentiate themselves. Developing proprietary stablecoins enables them to demonstrate technological leadership and adapt to the changing needs of their customers. This not only attracts tech-savvy clients but also positions the institution as a forward-thinking player in the market. A low level of risk for financial institutions in creating and maintaining their own stablecoins While the decision to create and maintain a stablecoin may seem bold, the level of risk for financial institutions is relatively low. This is primarily due to their established infrastructure, regulatory compliance, and the fundamental nature of stablecoins. Backed by reserve assets One of the defining features of stablecoins is that they are backed by reserve assets, such as fiat currencies or government bonds. For financial institutions, this means that the value of the stablecoin is tied directly to tangible assets held in reserve. This eliminates the price volatility commonly associated with cryptocurrencies like Bitcoin or Ethereum. Furthermore, financial institutions have the resources and expertise to manage these reserves effectively, ensuring the stability and reliability of their stablecoins. Regulatory frameworks Financial institutions operate within well-defined regulatory frameworks that provide a foundation for the development and maintenance of stablecoins. By aligning their stablecoin initiatives with existing regulations, institutions can mitigate legal risks and ensure compliance with local and international laws. The integration of AML and KYC protocols further reduces the risk of misuse, such as money laundering or fraud, providing a secure environment for both the institution and its customers. Technological expertise Large financial institutions possess the technological expertise and resources necessary to build and maintain secure blockchain systems. Unlike startups or smaller organizations, banks and other institutions have access to state-of-the-art infrastructure, skilled personnel, and robust cybersecurity measures. This significantly reduces the risk of technical failures or security breaches. Customer trust and adoption Trust is a critical factor in the success of any financial product. Established financial institutions have built their reputations over decades or even centuries, earning the trust of their customers. This trust extends to their stablecoins, making them more likely to be adopted compared to stablecoins issued by unknown or unregulated entities. The strong brand reputation of financial institutions also helps mitigate the risk of market rejection, as customers are more inclined to use a stablecoin backed by a reputable bank. Controlled issuance and circulation Financial institutions have complete control over the issuance and circulation of their stablecoins. This allows them to manage supply effectively, preventing issues such as overproduction or scarcity.
The strategic Bitcoin reserve: a bold move by President Trump
CBDC or the rise of digital currencies sponsored by central banks
Definition & context of CBDCCBDC is an abbreviation used for Central Bank Digital Currency. Typically, 2 different models need to be considered in the CBDC ecosystem. The first one, wholesale CBDC, describes a digital currency which links banks with financial institutions. The second one, retail CBDC, is a concept used to designate a currency issued by the private sector entities for common sale or purchase. In order to fully understand the concept of CBDC, it is necessary to detail both blockchain and crypto-currency concepts, which have similar roots and patterns within the whole environment of distributed ledger technologies.Historically, crypto-currencies supported by a blockchain allow for the rise of a new type of currency independent from any central authority and therefore immune against a potential debasement. Since the emergence of Bitcoin, many criticized the volatility of crypto-currencies and doubt that they could one day become a standard currency such as the USD or EUR. However, the major players in the world of Finance have recognized the revolution introduced by the blockchain technology. Many companies and consultancies are therefore trying to isolate the crypto-currency from the underlying blockchain, using it as an independent technology for any validation or settlement process. Even if the blockchain technology looks very promising on its own, crypto-currencies remain, on the other hand, a major topic when talking about blockchain and especially looking at the profitability of the whole ecosystem Even though the year 2022 has seen the biggest slump ever in the valuation of cryptos, the storm does not kill the major ones which appear now as a valuable investment on a long term perspective. Realizing the full potential of cryptos, central banks have led a counter-attack and decided to use the benefit of blockchain to design their own centrally issued crypto-currencies. If the move was quite slow at the beginning, central banks of around 120 countries have since then launched preliminary studies to assess the viability of issuing CBDC. A technical revolution in central bankingOn a technical point of view, what are the different forms of CBDC which have been observed until now ? According to a McKinsey’ survey, the following major types of CBDC have been identified among numerous existing developments : CBDC can be an account-based model. For example, DCash, the CBDC which is being implemented in the Eastern Caribbean, allows consumers to hold deposit accounts directly with the central bank. In the case of China’s CBDC e-CNY, central banks rely on commercial banks to set up and manage digital currency accounts for their private customers. Another model is the one developed by the European Central Bank in which each licensed financial institutions operate as a node in a permissioned blockchain, used as a conduit for the distribution of a digital euro. A final model is where a fiat currency would be issued in the form of anonymous fungible tokens to protect users’ privacy. However, it has not been fully trialed by central banks. Beyond the innovative aspects of CBDC, it is paramount to understand what are the full benefits of CBDC brought forward by these newest developments. The same survey shed some light on the potential benefits of CBDCs and described as follows: Reducing costs of financial services thanks to moving payments from physical infrastructure towards digital finance ($400 billion annual direct costs could be saved but reduced costs must be measured against the significant investments in new technology that CBDCs will require). Increasing speed of many countries’ electronic payment systems. Improving access for those without bank accounts through their mobile devices and potentially increase financial inclusion. However, CBDC’s adoption isn’t a guarantee because many underbanked people may favor the total anonymity afforded by cash. Which CBDC for which central bank ?According to the latest central banks implementations, 91 banks have started a study regarding CBDC in June 2023: 35 have been dedicated to wholesale CBDC, 87 for retail and 31 for both.Wholesale CBDC focus on the distributed ledger technology for market infrastructures, such as real time gross settlement system (RTGS) or Delivery versus Payment (DvP). A good example could be the wholesale CBDC project launched by the Bank of International Settlements: the BIS Innovation Hub is composed of 11 projects dedicated to CBDC as of end of year 2022. Among the whole portfolio, 7 projects are dedicated to wholesale CBDCs.To understand the global picture, each country has its own agenda for the study or development of an individual CBDC.In UK, for example, the Chancellor of the Exchequer and the governor of the BoE agree that a digital pound could emerge in the future. However the decision for such an issuance will be based on a large consensus in order to build public trust in such a digital currency.Regarding the US environment, the Fed has published a study in January 2022 about the potential creation of a digital dollar. However, there was no clear consensus between the thousand answers received, including from the Fed’s Board of governors. In March 2022, Joe Biden signed an Executive Order related to the development of digital assets which push the Fed and other US agencies to move forward with the development of CBDC. In sept 2022, two documents were simultaneously issued: A White House paper detailing the political objectives and technical options of a potential CBDC development and evaluating some recommendations about the preparation of a CBDC ‘s issuance. A Treasury’s department paper examining the current and forecast US payments system and recommending to go ahead with the preparation of a potential CBDC in case where such an issuance would be of national importance. Eventually, Jay Powell, the Fed Chair declared that the issuance of a CBDC would necessitate the approval of both the Government and the Parliament in order to become a reality. Finally, as one of the most advanced institution on this topic, the French Central Bank has recently performed the delivery of tokenized securities through a distributed ledger (which is in fact a permissioned blockchain or private ledger), in exchange for a payment
The Revolution of Spot Bitcoin ETFs: From Winklevoss Rejection to Ripple’s Legal Victory and Beyond
A long struggle with the RegulatorIn 2013, The Winklevoss brothers filed a registration statement to the SEC for the approval of the first spot Bitcoin ETF based on the price of the major crypto. This initiative was rebuffed by the SEC in 2017. The regulator as well as retail or institutional investors were not ready to adopt a financial instrument based on a cryptocurrency and Bitcoin was viewed at that time as a too exotic and volatile product. More recently, the company behind the Ripple protocol was sued by the SEC who objected that Ripple’s token, XRP, had to be considered as a security and not as a currency or a single mean of payment, which could result in some significant and additional regulatory constraints for the Ripple Organisation. Ultimately, Ripple emerged as the winner of the case in October 2023 after months of a legal battle. Nonetheless, the corporation could not definitely turn this victory into its own profit, the SEC still retaining some legal claims, should it reopen the case in the future. As a matter of fact, Ripple was still ranked among the top 5 during the latest crypto boom of 2021. Nevertheless, following the big slump of 2022, other cryptos and stablecoins managed to climb at the helm of the rankings and pushed Ripple out of the top league. Eventually, this judgment was mainly a turning point not just for Ripple but mainly for the major financial institutions, which were free of any regulatory constraint to develop and market their own cryptocurrency-based financial instrument. Finally, the legal victory of Ripple ultimately paved the way for the big financial institutions to follow the steps of the Winklevoss brothers 10 years ago and launch their own spot Bitcoin ETF. What is a spot Bitcoin ETF ?A spot Bitcoin ETF is like any other ETF except its underlying is simply based on Bitcoin. Briefly, the ETF’s price is correlated with the spot price of Bitcoin, roughly the price quoted on a real time basis on the main cryptocurrency platforms. It is not the first time that a financial product reflecting the price of Bitcoin has been structured and quoted on a financial market. Exchange Traded Products (ETP) based on the main cryptocurrencies (ETPs are wider than ETFs since they include exchange-traded notes -ETNs- and exchange-traded commodities -ETCs) were already available to investors for some time. However, the price of these products was not quoted throughout the day to reflect the current price of Bitcoin (ETPs are indeed pegged to a value of a derivative). The revolution introduced by the spot Bitcoin ETF is that its price is directly pegged to the fluctuations of Bitcoin . What makes Bitcoin so popular today beyond all the hype around the concept of a digital token, is the blockchain technology supporting it. Traditional actors of the Financial World ranging from big Consulting companies to World-size Fund managers were willing to monopolize that technology to develop a standard financial product aimed at becoming one day a commonly accepted listed product. A few months ago, running through the door opened by Ripple’s court victory, the biggest financial institutions positioned themselves with the SEC to be granted an agreement to market their own Bitcoin ETF: Blackrock, Grayscale, Van Eck, Invesco (…) were among the biggest names in the World of Asset and Fund Management to lead the race… What impact on the future price of Bitcoin ?The addition of the spot Bitcoin ETF instruments on the financial markets has big implications regarding the daily supply of Bitcoin to feed this new breed of instruments. The first constraint already impacting the availability of Bitcoin ETF is the finite stock of 21 million token governing the Bitcoin cryptocurrency. Just based on this specific feature, the price was already expected to rise on a long term perspective. Soon after the SEC granted the first approvals, it has been calculated that the new ETFs would require the supply of 10 or 12 times the current daily production of Bitcoin, which should logically lead to a shortage of the cryptocurrency. During the booming crypto year of 2021, a level of around $ 100-140k was frequently forecasted as a plausible target for the price of Bitcoin. Forgotten during the following year of 2022 due to a slump affecting all the cryptos, this level has resurfaced following the recent surge allowing Bitcoin to rally by more than 60% in 2023 (some cryptos experts now even talk about a possible target of $ 400K…). Last but not least, the ‘Halving’ of Bitcoin expected around mid-April should bolster this trend: the daily production of the token is expected to be divided by half due to the same reduction of the reward offered by the Bitcoin protocol to add a block to the chain. This shortage problem could then be exacerbated unless investors already pushing higher the price of Bitcoin until the event occurred, suddenly cut their position to drive down the price around $ 42 000, as expected by JPMorgan analysts.
Bitcoin Ordinals, the rise of alternative NFTs
Definition of Non Fungible TokenSince the rise of Bitcoin and other cryptocurrencies, a particular form of token has been developed which are deemed non fungible and allow artists and more common users to create, build and share a piece of art by using a token to materialize their content in a blockchain. These particular tokens are designated under the label NFT, a label used for Non Fungible Token. NFTs were created around the years 2013/2014 and gained in popularity in 2017 when Digital art and NFTs were linked together. Valuations attached to NFTs can be very different considering the theme, creator or design of a given digital artefact attached to a token. At their height, very trendy NFTs were estimated to be worth hundreds Bitcoin (or millions USD)…although the frenzy soon collapsed around a year after. Nevertheless, NFTs remain today a popular support as a digital vehicle to convey and market art in a blockchain and through the Web3 ecosystem entirely. Ordinal NFTsNowadays, most NFTs have been developed in the Ethereum blockchain using the standard token ERC-721. However, another type of NFTs has been recently introduced based on a transaction in the Bitcoin blockchain.Called Ordinal NFTs or Bitcoin Ordinals in the Bitcoin ecosystem, they are based on the Ordinals theory, and more specifically around Satoshis, on which Bitcoin Ordinals have been elaborated inside the Bitcoin ecosystem. According to the Ordinals theory, Satoshis are recognized as the smallest element of the Bitcoin blockchain and therefore do exist as an underlying support on which to inscribe some digital art content with a full intrinsic value. According to Casey Rodarmor, who initiated the Ordinals project, the Bitcoin NFTs protocol allows users to inscribe different types of metadata (images, videos, PDFs,..) on Satoshis and mint Bitcoin NFTs directly on the Bitcoin blockchain. Comparison between Ordinal and Ethereum NFTsOrdinal NFTs are based on individual Satoshis, which host the art and content and are directly inscribed on-chain. Once an inscription is initially made on a Satoshi, final ordinal NFTs are sent to Ordinal wallets and stored in the Bitcoin blockchain. Thanks to this on-chain feature, Ordinal NFTs benefit from both higher decentralization and security standards based on Bitcoin’s cryptographic features. On the contrary, Ethereum’s ERC-721 standard used to create NFTs host art or creative content off-chain. Traditional NFTs are thus contingent upon the rules and functioning of the token embedded smart contract and directly impacted by any technical change in the Ethereum network. In addition, as of today, Bitcoin remains the most liquid cryptocurrency in the world. Since Ordinal NFTs are stored on a Bitcoin blockchain, they are definitely more liquid than any traditional NFT that have been developed using other blockchains such as Ethereum, Cardano, Polygon… Royalties are intertwined with Ethereum NFTs right since the beginning. In contrast, the structure of Bitcoin blockchain prevent owners of Ordinal NFTs to modify a transaction record on which to implement royalties. Meanwhile, the Bitcoin blockchain’s structure does not favor the implementation of complex smart contracts allowing for automated payment flows. Through the consensus mechanism of the Bitcoin blockchain, a transaction becomes permanent after validation by the network’s nodes, designating the transaction as immutable and recording it permanently in the public ledger. If Ethereum NFTs are also immutable, metadata linked to the NFTs are stored off-chain on a centralized server and thus are prone to updates at the will of the NFT’s owner. Finally, since Bitcoin has a finite inventory of 21 million tokens and that mining is rendered expensive by a proof-of-work consensus mechanism, the number of Ordinal NFTs is tied to a finite number of coins. This ‘digital’ ceiling provides a kind of premium for the current value of existing as well as future Ordinal NFTs. On the contrary, since a standard ERC-721 contract has no limit in the number of issued tokens, there is theoretically no limit in the number of traditional NFTs that can be created, thus limiting their current or future value.
Bitcoin’s valuation at $60 000 by 31 dec. 2023 ?
Bitcoin’s valuation at $ 60 000 by 31 dec. 2023 ? The collapse of big players threatening the future of Bitcoin Bitcoin as a ‘standard’ driving the valuation of all other cryptocurrencies A bullish trend since the beginning of the year The collapse of big players threatening the future of BitcoinFollowing the year 2021 during which crypto valuations have reached stratospheric levels, 2022 has been marked by the opposite trend, the bitcoin value recording a sharp decrease of around 70% and affecting valuations of the whole cryptocurrencies ecosystem. In that context, cryptos based on algorithmic calculation have been particularly hit by the storm, some like TerraUSD erasing 90% of their value and affecting thousands of holders who incurred huge losses. The slump in crypto has also affected some of the biggest exchanges. FTX, the second biggest worldwide cryptocurrency platform went bankrupt due to a lack of adequate liquidity management process and some excessive risk taking through its bets with its Alameda subsidiary, burning the cash deposits of FTX customers. The crash of some major names in the industry has also unleashed the bankruptcy of numerous crypto firms partnering with the biggest exchanges, especially crypto banks providing liquidity and support for the trading of crypto-based derivatives. After such an earthquake devastating the whole ecosystem, many expected and even declared the end of cryptos and the biggest among them, Bitcoin. Bitcoin as a ‘standard’ driving the valuation of all other cryptocurrenciesFive times it has been said that the Bitcoin would disappear, five times it has rebounded from the lowest following a dramatic collapse of its price. Based on the historic trend dating back to 2009, the year which saw the birth of Bitcoin, it is currently admitted that a 2 years period is a standard time before the Bitcoin could regain the lost valuation from its previous peak. The current trend suggests we are again in the same type of paradigm for the year 2023. Compare to a low point of around $15000-$16000 at the end of 2022, Bitcoin has already recoup the equivalent to reach a $30000 valuation; it is near half the value of its peak at nearly $68000 recorded on sept 2021. Just at the beginning of the year, many analysts of the crypto markets were still proclaiming it was time to sell !!!…Considering cryptos valuations, it is very hard to predict future prices. However, year after year, Bitcoin has consolidated its position as a standard like Gold is considered now in the field of precious metals. Many opponents to the Bitcoin argue that it is much more secured to invest in physical Gold than in Bitcoin; part of the success of Bitcoin lies indeed on the so-called ‘debasement’ of traditional currencies. In case of a whole collapse of the current financial system, it could appear safer to be invested in ‘hard’ precious metal. Nevertheless, in case of a collapse of the whole financial system, it is probable that only the decentralized financial assets will remain unaffected from a potential collapse. Again, after review of the historic yearly valuations, it seems that assumption is only true when the Bitcoin’s valuation is decorrelated from those of major equities and bonds markets. A bullish trend since the beginning of the yearSince the end of 2022, Bitcoin has recorded a major rebound. To be precise, the valuation of Bitcoin was exactly $16 604 on 31st Dec 2022. at the moment the following lines are written, it quotes nearly $30 000, almost double the price a little more than 3 months ago. The performance is really impressive, especially in the context following the collapse of some major platforms in the crypto world. Beyond this impressive achievement, different scenarios could occur in a near future. A first one encompass the performance of the last 3 months and could see the Bitcoin reach a valuation range of $45 000 – $60 000 before September 2023. On the contrary, there is always a possible adverse scenario in which a downward trend of Bitcoin occurs due to some unpredictable events. Once again, there is no current expectation of such events happening in a near future because major adverse events already materialized in 2022. Consequently, the market is probably now fully cleaned of any potential collapse and the risk of a downward trend occurring in the next few months appears very low. Moreover, besides the first two scenarios, there is a third and very optimistic one. Following an identical trend as for the first 3 months of the year 2023, it is even possible that the Bitcoin could reach $ 100 000 by the end of the year. In the next following months, it will be easy to see if the upward trend shows more the way towards the 45K-60K valuation rather than to the one of 100K…
Prototype for a public blockchain focused on ESG certification
BNI’s team decided to move forward with a Proof of Concept exercise and build a prototype for a public blockchain focused on ESG certification. The biggest challenge to date is to find the right team of developers to build and help with the design of the Blockchain while explaining in simple terms the desired outcome. The next following lines describe the roadmap leading to the final blockchain, the obstacles to overcome and the setup of a method to be the most efficient in the building of blockchain. 1) The beginning of a journey On the road to push BNI for becoming more popular with all the fans of Blockchain, BNI’s team decided to move forward with the building of a real blockchain, especially a public one dedicated to ESG certification. For the need of this article’s readers, the blockchain project will be labelled as the ‘prototype’. The team believes that focusing on building and animating a team to design a first version of a ‘prototype’ will greatly contribute to the Blockchain ecosystem and help improve the team’s knowledge of Blockchain functionalities and techniques at the same time. The field on which the prototype is based on is a complex one, but it offers the opportunity to develop a blockchain in a complicated environment and to adapt the methods used to build this blockchain to another field like cryptocurrencies for example. Besides this complex environment, it remains the prototype must be built on simple concepts to provide it with solid foundations. As the team decided to move forward with the design and conception of the prototype, it is also important the cost of the project was not too expensive in order to stick to the idea of a ‘prototype’ which, in addition, won’t be directly sold to our customers. 2) The organization of the POC The first challenge surrounding the conception and design of a prototype is to find the right team of developers able to understand the challenges of the POC and to build a suitable strategy aimed at properly building and designing a prototype. One of the first options to build a network of developers is to call local people to help the team achieve the project. However, there are not enough contacts in BNI’s address book so that the challenge could be locally addressed. More interesting, the team found out that the biggest pool of developers we know is in Asia. Requests have been sent to the developers located in this part of the world, which has also the advantage to get the most competitive rates for the design and building of the prototype. Talking with our partners, we also discovered that sending a complete and finished set of detailed business requirements is not enough to ensure a good conception of the prototype. Consequently, we will probably have to provide more details and explanations about the many different aspects of our project and the goals we wanted to reach in building the prototype. During the project, we also discovered that we are not obliged to give the whole assignment to one single developer but that we could divide the task along different suppliers. It is probably more demanding in the management of the whole project, but we think we can earn flexibility and a better result for our prototype. 3) The details of the roadmap We considered dividing our roadmap into different sections as described as below: – Once the business requirements have been written, identify the right teams of developers and provide them with the detailed requirements – Organize kickoff meetings with developers in order to explain the whole project and to convince them to join the adventure – Once a dedicated team has joined the project, organize explanatory meetings with the developers to explain the project goals and proper details. Regarding the timing of the project, no definite schedule has been drawn for the final building of the prototype. In theory, programming a first version of the prototype could take between one and two weeks. In practice, there is not current hurdle for developers to take a few weeks more in order to develop the prototype. After the first reviews with developers, some unexpected hurdles should appear regarding the feasibility and costs associated with the project. At first, it appears there is a huge entry cost just to set up the blockchain infrastructure (that means without adding the cost of the smart contract containing the compliance and benchmark tables). Secondly, it appears difficult to translate the business needs relating to ESG standards into technical standards and orientations for technical teams, just based on the written requirement. Consequently, additional work meetings will be necessary to provide the developers with the key information to achieve their programming goals. A final consequence will also be to inflate the entire cost of developing the prototype.
