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Crypto SWOT: Taxpayers in Colorado can now pay in crypto

Commentaries & Views

Strengths

  • Of the cryptocurrencies tracked by CoinMarketCap, the best performer for the week was XRP, rising 49.29%.

  • Nasdaq is making its first major push into crypto, reports Bloomberg, as the second-largest stock exchange prepares to capitalize on increasing appetite for digital currencies among big-money investors. A new group dedicated to digital assets will initially offer custody services for Bitcoin and Ether to institutional investors. As a custodian of digital assets, Nasdaq would be competing with crypto firms such as Coinbase, Anchorage Digital and Bitgo, the article continues.

  • A crypto industry lobby wants the judge in a high-profile digital assets case to consider Congressional efforts to establish a new legal framework for the nascent industry before moving ahead, reports Bloomberg. The chamber of Digital Commerce, a crypto advocacy organization, filed an amicus brief Wednesday in the SEC lawsuit against Ripple Labs.

Weaknesses

  • Of the cryptocurrencies tracked by CoinMarketCap, the worst performing for the week was RavenCoin, down 23.82%.

  • A slide in cryptocurrencies on Monday sent Bitcoin to a three-month low as sentiment took a knock from a wave of monetary tightening that's set to stretch from Europe to the U.S. Bitcoin sank as much as 7.4% and was trading at $18,644, which is the lowest since digital asset prices tumbled after the collapse of crypto lender Celsius in June, writes Bloomberg.

  • Cryptocurrency hedge funds lost 4.9% in August, the most among all investment styles, according to Bloomberg Hedge Fund Indices. The Bloomberg All Hedge Index fell .2% in the month and lost 5.9% year-to-date. So far this year, cryptocurrency funds are down 41%, according to Bloomberg.

Opportunities

  • Colorado taxpayers can now pay their taxes in Bitcoin, Ether, and other cryptocurrencies under a one-of-a-kind state tax payment program in conjunction with PayPal. Businesses and individuals will be able to use cryptocurrency assets to pay tax duties under Colorado's primary tax programs, writes Bloomberg. Because Colorado can't directly accept crypto itself, the Revenue Department has contracted PayPal to broker each transaction and immediately convert digital currencies into U.S. dollars.  

  • Cryptocurrencies outperformed U.S. equities for a change, with Bitcoin and Ether gaining for the first time in five days. Bitcoin rose about 2% on Friday and Ether rose about 1.5%. Markets are shuddering at the Fed's determination to fight inflation by constricting financial conditions, writes Bloomberg.  

  • Cryptocurrency exchange FTX is in talks with investors to raise $1 billion in funding, CNBC reports. The valuation of billionaire Sam Bankman-Fried's firm will be at $32 billion, according to the report. That's the same as in January when the company raised $400 million, writes Bloomberg.  

Threats

  • The U.K.'s Financial Conducts Authority published a warning to consumers about Sam Bankman-Fried's crypto exchange FTX, saying it isn't authorized by the regulator to offer financial services or products in the country. The regulators said that FTX “is targeting people in the U.K.” adding that investors are “unlikely to get your money back if things go wrong,” writes Bloomberg.  

  • South Korean prosecutors signaled that Do Kwon, the progenitor for a $60 billion cryptocurrency wipeout, is at risk of an Interpol red notice and trying to evade redress over a meltdown that roiled digital assets. Kwon had moved from South Korea to Singapore, reports Bloomberg, where the now-collapsed Terraform Labs project had a base, but the city-state says he's no longer there. Kwon's location is unclear, and he denies being on the run even as prosecutors in Seoul seek his detention for allegations including breaches of capital-markets law.

  • Jesse Powell, co-founder of crypto exchange Kraken, is planning to step down as CEO, Kraken confirmed with CoinDesk. Kraken's current chief operating officer will take over as CEO until someone is hired to fill the position, according to an article published by CoinDesk.
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