Digital Asset News Roundup – Tesla Accepts Bitcoin, Uniswap V3, Powell Says Bitcoin like Gold

 

Digital Assets never sleep, and neither do their news cycles. Let’s breakdown some of the biggest news stories over the past week and what they mean for the markets as a whole.

 

Tesla now Accepts Bitcoin

 

 

Elon Musk just tweeted out that you can now buy a Tesla with Bitcoin. The most interesting part is that he said that it would not be converted to fiat currency. So, he’s basically created a clever way to get Bitcoin and not spend it, which means that Tesla is a long-term holder.

This is bullish for the digital asset market as a whole. You’ll still see Bitcoin detractors saying it’s worthless because you can’t buy coffee with it. No one in their right mind should want to buy coffee, or a Tesla, with Bitcoin considering its proven history as a store of value and inflationary hedge.

The Bitcoin community decided the path they want to go down is digital gold. While you can’t build anything with Bitcoin, you can still use it to protect your wealth. Its genius is in its simplicity. Additionally, you can build financial tools around Bitcoin like Paypal, and cash app is doing right now.

So, Elon is basically signaling he’s a long-term holder of Bitcoin without outright saying it.

 

Uniswap V3 set to launch advancing the Defi Ecosystem

 

 

 

Defi is disrupting legacy finance by democratizing traditional tools that were inaccessible to the masses. Uniswap V3, a protocol that exists on the Ethereum blockchain, is set to launch on May 5th. One of the benefits of Uniswap was the ability to be a passive liquidity provider and earn fees with every trade on the platform.

Uniswap V3 is rolling out a feature called “Concentrated Liquidity,” so you can pick a range that will provide more capital for the platform.

For example, you could choose a range of where you think ETH will trade between, of which you can be an LP. If you believe ETH will trade between $1,000 – $ 2000, you will become an LP for that trading range. Currently, there are millions of dollars worth of ETH sitting idle because you don’t have the option of choosing a trading range.

This will make the LP more “capital efficient,” which means you can earn more fees and earn a higher return rate on your capital.

This is bullish for Ethereum more than anything else. As an investor, if you’re wondering how to gain exposure to Defi without as much risk, simply buying ETH or investing in the Two Prime Digital Asset Fund I is the best approach. Buying ETH gets you exposure to Defi without having to gamble on individual coins.

 

Jerome Powell claims Bitcoin is a substitute for Gold

 

 

Jerome Powell doesn’t believe that Bitcoin will ever replace the dollar. However, he did add fuel to the fire by saying it’s a substitute for Gold. While he does consider it a “speculative store of value,” it’s still an encouraging sign from what many considered an enemy of digital assets.

This also starts to take the wind out of the sails of anyone who thinks Bitcoin or Ethereum will be banned. They are regulated assets that are here to stay. The policies surrounding them will only get better, making it much easier to co-exist and integrate with legacy finance. For now, into the foreseeable future, they are more of a parallel universe to traditional finance rather than an outright replacement.

Powell also discussed a central bank digital currency as well as the benefits and the risks. While these aren’t outright signs of adoption, the Federal Reserve seems to have lightened its stance on digital assets. For the Federal Reserve chairman to advocate for a CBDC basically means they see the value and need for them in today’s environment.

Most people prefer the original to the copy, which means projects like Bitcoin and Ethereum could grow in mass adoption. It’s similar to the reputation that gold has built over thousands of years. Once people opt-in and become believers, it’s difficult to change their minds.

The launch of a CBDC will also always be associated with Bitcoin and Blockchain, which only increases its value in investors’ eyes.