NOTABLE MOVES 

As of Fri, Dec 21, 08:00 GMT (UTC +08:00)

USDJPY, -0.02%, $111.26
EURUSD, -0.66%, $1.1370
GBPUSD, -0.09%, $1.2645
USDCAD, +0.70%, $1.3603
AUDUSD, -0.91%, $0.7042
NZDUSD, -0.80%, $0.6721

S&P 500, -2.06%, 2,416.62
Nasdaq, -2.99%, 6,332.99
Nikkei Futures, -0.79%, 20,050.0

CURRENCY MARKET WRAP 

U.S.

• Personal Spending m/m at 0.4% vs expected 0.3%.
• The key takeaway from the report is that it showed PCE inflation continues to run below the Federal Reserve’s longer-run target of 2.0%, which could raise the market’s angst level about the Fed being on course to make a policy mistake with further tightening action. The 2-yr yield dropped four basis points to 2.63%, and the 10-yr yield was unchanged at 2.79%.Core Durable Goods Orders m/m -0.3% vs expected 0.3%. Final GDP q/q  3.4% vs expected 3.5%. Core PCE Price Index m/m at 0.1% vs expected 0.2%.

U.K.

• Current Account -26.5B vs expected -21.7B. Final GDP q/q 0.6% vs expected 0.6%. Public Sector Net Borrowing 6.3B vs expected 7.0B. It was a hectic week in Brexit land.
• In a statement last week, PM Theresa May said the vote on her Brexit deal will take place in the week beginning 14 January (debate in the House of Commons will begin the week before that). May also said that negotiations with the EU continue despite the EU having said that no further negotiations are planned and that the EU27 will not reopen the Withdrawal Agreement. It seems like the EU leaders will not change position at least until the UK politicians find out what they want.

Canada

• Core Retail Sales m/m 0.0% vs expected 0.2%. GDP m/m 0.3% vs expected 0.2%. Retail Sales m/m 0.3% vs expected 0.4%

STOCK MARKET WRAP 

• The S&P 500 fell -2.06% on Friday, as uncertainty surrounding a host of issues – including politics and trade, continued to provide a justification to reduce risk. The S&P 500 had climbed to session highs in morning action (+1.5%) amid some market-soothing commentary from New York Fed President John Williams. Specifically, Williams indicated that the Fed is listening to the market and that the path of balance sheet runoff in 2019 is not “inflexible.” Some discouraging headlines that compounded risk-reduction efforts included (1) the threat of a partial government shutdown due to disagreement over funding for a border wall, and (2) a late-day report that Director of the White House National Trade Council Peter Navarro told Nikkei that an agreement with China in 90 days will be difficult to attain.
• Dow component Nike (NKE 72.37, +4.84, +7.2%), for its part, was the best-performing stock in the S&P 500 after it released a strong earnings report and issued an encouraging FY19 currency neutral revenue growth outlook.

Israel’s Central Bank Issues Request for Information on DLT

The Bank of Israel has issued a formal request for information about Distributed Ledger Technology (DLT). Besides the country’s central bank, the team reportedly includes representatives from the country’s Securities Authority, the Ministries of Finance and Justice, the Tax Authority, the Israel Money Laundering and Terror Financing Prohibition Authority and various other local regulatory bodies. The document asks for information pertaining to barriers to the development of the local DLT industry. The text inquires explicitly about problems encountered by local DLT companies, fundraisers, investors and consumers dealing with virtual assets as examples and the request inquires about the risks inherent in the use of virtual assets and the opportunities of DLT in the finance industry. The request ask as well asks how DLT can help address issues regarding Anti-Money Laundering (AML) and terrorism financing. Interested parties are invited to submit relevant information until Dec. 31, 2018.

Launch of Bakkt Bitcoin Futures Market May Get Postponed Again

Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, is likely to delay the launch of Bakkt, its bitcoin futures trading and custody platform, a second time. Specifically, the CFTC must grant an exemption for Bakkt’s plan to custody bitcoin on behalf of its clients in its own “warehouse,” according to sources familiar with regulatory discussions of the plan. CFTC regulations normally require that customer funds be held by a bank, trust company or futures commission merchant (FCM). At this moment, the commissioners have to vote on whether to put out the proposal for public comment. After the 30-day comment period, the commissioners would likely take at least a couple days to read the comments, and then vote on the proposal itself. The earliest the commissioners are likely to vote on a public comment period and thereby start the 30-day clock is Wednesday, Dec. 26, the day after Christmas. This would be the second postponement. ICE had originally aimed to launch Bakkt in December, but last month it said that the “volume of interest” in the company and the “work required to get all the pieces in place” necessitated a delay.

Bitcoin Above $4,000 Again as Top Cryptocurrencies See Gains Across the Board

On Sunday, Dec. 23, all of the top 20 cryptocurrencies have seen moderate gains, with Bitcoin’s (BTC) price going above $4,000 again, according to CoinMarketCap data. At press time, Bitcoin is up nearly four percent on the day, trading at $4,050. And on the weekly chart, the current price is lower than the Friday’s high of almost $4,200; but the cryptocurrency is still trading significantly up from $3,294 the point at which it started this week. Ripple (XRP) has gained over five percent on the day, trading at $0.374 as of press time. On the weekly chart, the current price is significantly higher than $0.292, the price at which XRP started the week. However, the current price is slightly lower than the high of $0.389 reached on Wednesday. Ethereum (ETH) is trading at $128, having started the day at $111 and hitting an intra-day high of $133. On the weekly chart, the current price is notably higher than $87, which was the value of ETH on Monday. The total market capitalization of all cryptocurrencies has surged to over $135 billion at press time.

NOTABLE MOVES 

As of Thu, Dec 20, 08:00 GMT (UTC +08:00)

USDJPY, -1.16%, $111.18.
EURUSD, +0.69%, $1.1456.
GBPUSD, +0.47%, $1.2669    .
AUDUSD, -0.97%, $0.7113.

S&P500, -1.58%, 2,467.42
Nasdaq, -1.63%, 6,528.41
Nikkei Futures, -3.25%, 20,240.0

CURRENCY MARKET WRAP 

• Dollar was offered on Thursday, with Safe-Haven assets staying bid in the face of continued risk-aversion. U.S. Treasuries closed on a lower note, pushing the 2-yr yield up three basis points to 2.67% and the 10-yr yield up one basis point to 2.79%. The U.S. Dollar Index fell -0.7% to 96.36, while gold futures settled 0.9% higher to $1267.00/oz, reaching its highest level since June.
• The BoJ kept its ‘QQE with yields curve control’ policy unchanged this morning. The board voted 7-2 in favour of maintaining its policy. This was widely expected. The central bank maintained a promise to keep both long and short-term rates extremely low for an extended period of time to ensure that the economy can deal with a major tax increase scheduled for October next year.
• The BOE’s rate-setting monetary policy committee (MPC) voted unanimously to leave the cost of borrowing unchanged at 0.75%, as it warned that consumer demand and business investment was likely to have suffered amid the political impasse over Theresa May’s plan to leave the EU. Against that backdrop, the MPC said that UK growth would probably slow to 0.2% in the final quarter of the year, below its previous expectations. It added that the slower rate of growth would probably persist into the first quarter of 2019. Despite the gathering problems for the British economy, the central bank said it still believed higher interest rates would be required over the coming years to keep a lid on inflation, although only in the event of a smooth Brexit.

STOCK MARKET WRAP 

• The S&P 500 staged a late recovery try to cut its losses from -2.6% to -0.8%, but that recovery effort was once again met with selling resistance that drove the market further into oversold territory. Some nettlesome elements that weighed on investor sentiment Thursday included (1) the possibility of a partial government shutdown, (2) a reminder that the dispute between the U.S. and China goes much deeper than just tariffs on goods, and (3) the understanding that credit markets appear to be anticipating a growth slowdown due to tighter monetary policy.Furthermore, weakness in oil ($44.95, -$2.33, -4.8%) and copper ($2.70, -$0.01, -0.4%) prices, and the underperformance by the cyclical sectors, fed into the market’s concerns about a slowdown in global economic growth.

 

Cryptocurrency businesses find it “almost impossible” to get insurance and this is deterring investors, Big Four auditor PricewaterhouseCoopers (PwC) said. In comments focusing on the global fintech market, Henri Arslanian — the firm’s fintech highlighted the contradictory status quo industry businesses face trying to attract funding. “Most institutionally-minded crypto firms want to buy proper insurance, and in many cases, getting adequate insurance coverage is a regulatory or legal requirement.” Mining giant Bitmain — whose reported plans to conduct an initial public offering (IPO) in Hong Kong were revealed in June — has faced multiple reports of misgivings on the part of both local regulators and prospective host, the Hong Kong Stock Exchange (HKEX). At the same time, those involved in funding crypto businesses, such as cryptocurrency merchant bank Galaxy Digital, maintain that the entry of institutional investors is both guaranteed and a major step to legitimizing the market.

McAfee: Crypto-Mining Malware Grew By Over 4,000 Percent in 2018

According to research from McAfee, Instances of crypto-mining malware increased more than 4,000 percent this year. In its December 2018 report, the U.S.-based cybersecurity firm said that there were nearly four million new mining malware threats in the third quarter of 2018 alone, compared to less than 500,000 in 2017 and 2016. Another release giving specific numbers showed that the number of malicious crypto-miners grew nearly 55 percent in Q3 of 2018, with total malware growing 4,467 percent in the last four quarters. McAfee also discovered a Mac OS threat named OSX.Dummy, which is being distributed on cryptomining chat groups. The malware, posted online, suggests that users download software to fix “crypto problems,” after which it injects its malicious code. This way, users essentially infected their own devices.

Western Union Considers Crypto, Partners with Ripple to Test Blockchain Payments

The president of Western Union Global Money Transfer has claimed the company is “ready to adopt any kind of currency,” potentially including cryptocurrencies. Almeida believes that the firm’s long-term stance makes it potentially ready to launch any type of currency, including blockchain-based ones. However, Almeida thinks that in order to achieve mass adoption, cryptocurrencies have to solve problems with volatility, governance and compliance. As per the Western Union exec — hinting at the concept behind some stablecoins — the issue with volatility in crypto markets can be addressed by pegging coins to some “strong currencies, such as the [United States] dollar.” Apart from cryptocurrencies, Western Union is also exploring the use of blockchain.

NOTABLE MOVES 

As of Wed, Dec 19, 08:00 GMT (UTC +08:00)

USDJPY, -0.11%, $112.41.
EURUSD, +0.23%, $1.1387.
GBPUSD, -0.17%, $1.2626.
AUDUSD, -0.97%, $0.7113.

S&P500, -1.54%, 2,506.96
Nasdaq, -2.17%, 6,636.83
Nikkei Futures, -1.87%, 20,675.0

CURRENCY MARKET WRAP 

• In FOMC, the target range for the Fed funds rate was increased by 25 basis points from 2.25% to 2.50%, as most expected it would be, and the so-called dot-plot was revised to show a median projection for two rate hikes in 2019, versus three previously. That wasn’t altogether surprising either; nonetheless, it still appeared hawkish relative to the zero rate hikes currently expected by the fed funds futures market. Some of Powell’s more nettlesome talking points for the market were that (1) policy does not need to be accommodative now and that he doesn’t believe the current policy is restrictive, and (2) he does not see the Fed altering its approach to balance sheet normalization and sees the preferred policy method being use of the fed funds rate.Risk-Aversion in the market picked up noticeably right after the FOMC directive was released and then it kicked into a higher gear during Fed Chair Powell’s press conference. The sell-off in the stock market prompted a flight to safety in U.S. Treasuries, pushing yields lower. The yield curve also flattened with the Fed-sensitive 2-yr yield losing two basis points to 2.64%, and the benchmark 10-yr yield losing five basis points to 2.78%.
• U.K. CPI y/y inline at 2.3%. The BOE will reveal the result of its latest monetary policy meeting later today, although no changes are expected to introduce to rates or the APP program.
• Canada’s annual inflation rate dropped to 1.7 per cent in November, marking the first time the price gauge has come in below the Bank of Canada’s target since early this year.Statistics Canada said Wednesday consumer prices fell -0.4 per cent month-to-month amid weaker gasoline prices. Annualised growth was at its slowest pace since hitting the same 1.7 per cent rate in January.

STOCK MARKET WRAP 

• The S&P 500 dropped -1.54% on Wednesday in what was a tale of two trading sessions. The first part of the day was governed by a sense of hope that the Fed would provide the stock market with a dovish-minded perspective on the interest rate outlook. The second part of the day, which began at 2:00 p.m. ET (the time of the FOMC announcement) was governed by a sense of disappointment that the FOMC, and Powell, didn’t deliver on the market’s wishes.
• The S&P 500, up as much as 1.5% at its high for the day, sold off in the wake of the FOMC announcement, setting a new low for the year (2488.96) before bouncing slightly in closing action to end the day at 2506.96.
• Separately, Facebook (FB 133.25, -10.41) was a notable laggard Wednesday, both in the first part of the day and in the second part of the day.  It declined -7.3% after a New York Times article alleged Facebook provided technology companies more access to user data than it previously disclosed and following a Washington Post report stating the company is being sued by the Washington D.C. Attorney General over alleged privacy violations from the Cambridge Analytica scandal. Facebook is now down -38.7% from its all-time record close on July 25.

Qtum Awards $400K Grant to Columbia University Research Team for Smart Contracts R&D

Open source blockchain project Qtum has awarded a $400,000 grant to academics at Columbia University to fund the development of a new programming language for Ethereum (ETH)-style smart contracts. The R&D will focus on the design and implementation of a new language named “DeepSEA” and its integration with Ethereum-style smart contracts. The research and development (R&D) grant will go to a team of two PhD and postdoctoral students, headed by assistant professor at Columbia’s computer science faculty, Ronghui Gu. The main goal is to continue to both design and implement the language, and to develop a DeepSEA “toolchain,” which could subsequently be applied to “build certified OS kernels and Ethereum-style smart contracts.”

French Parliament Refuses to Ease Taxation for Cryptocurrency Owners

The lower house of the French parliament has rejected the amendments to the 2019 finance bill which would ease crypto-related taxation. The amendments that have been declined by the National Assembly referred to a draft of the government finance bill for 2019. Allegedly, four proposals were rejected by the Parliament in total. One of them was to introduce a distinction between regular crypto transactions and occasional ones, offering a more relaxed taxation system for the latter and the other referred to the recommendation to increase the annual volume of transactions that falls under tax exemption from €305 (around $350) to €3,000 ($3,430), or even €5,000 ($5,714). The National Assembly also declined the proposal to follow the current guidelines for securities when introducing crypto taxation. a reduction of the crypto income tax rate from 36.2 to 30 percent was also proposed in November. That amendment was mentioned during the Assembly’s meeting, but its current status remains unclear.

Iranians Still Profiting From Bitcoin Mining Despite Market Crash and US Sanctions

Iranians are turning to Bitcoin (BTC) mining due to economic difficulties caused by sanctions by the United States. As reported by Atlantic Council, 26-year-old Iranian Ali Hosseini and his cousin Pedram Ghasemi bought a Bitcoin mining device Antminer S9 two months ago for $526, when the top cryptocurrency was trading around $6,500 and they claimed that they are “not seeing losses yet” due to “relatively low” prices for electricity. The brothers also suggested that the “US dollar must drop below 110,000 rials and Bitcoin must be down to $2,000 for [them] to really lose.” Instead of considering shutting down crypto mining and selling their mining hardware, as some businesses have, Hosseini said that they are even planning to purchase more mining devices, predicting that crypto will inevitably replace fiat money. Since the central bank of Iran banned domestic banks from dealing crypto earlier in 2018, trading cryptocurrencies is still not legal in the country.

 

NOTABLE MOVES 

As of Tues, Dec 18, 08:00 GMT (UTC +08:00)

USDJPY, -0.27%, 112.52
EURUSD, +0.26%, $1.1376
GBPUSD, +0.21%, $1.2654
USDCAD, +0.37%, $1.3455

S&P500, +0.01%, 2,546.16
Nasdaq, +0.45%, 6,783.91
Nikkei Futures, -1.82%, 21,115.45

CURRENCY MARKET WRAP 

• The Federal Reserve will conclude a two-day policy meeting on Wednesday, with investors anxiously anticipating the central bank’s interest rate decision and policy statement. Markets are expecting a rate hike, but the certainty for the central bank and Wall Street ends there. Trump’s relentless campaign of pressure on policy makers to halt the rate hikes has further clouded the picture, warning them to avoid “yet another mistake” just hours before the two-day meeting began.
• Oil prices dropped over 1 per cent yesterday, falling for a third straight session, as reports of inventory builds and forecasts of record shale output in the United States, currently the world’s biggest producer, stoked worries about oversupply. Concerns about future oil demand amid weakening global economic growth and doubts over the impact of planned production cuts led by the Organisation of the Petroleum Exporting Countries (OPEC) were also pressuring prices. The dollar fell against most G-10 peers.
• Chinese President Xi Jinping addressed his nation yesterday to commemorate the 40th anniversary of China’s “reform and opening up.” He struck a relatively defiant tone in response to calls for changes to the economy, warning other nations not to impose their will on China or interfere in its development. “No one is in the position to dictate to the Chinese people what should and should not be done,” he said in apparent reference to demands from Washington and other capitals that China should undo some of its protectionist economic policies (even as Chinese negotiators have quietly offered concessions). Mr. Xi also used the speech to defend policies that he had forged over the past six years to make the Communist Party even more powerful, strengthen the state-run sector of the economy while allowing private business to grow, and put China’s stamp on international affairs. He is quoted as saying that “China’s development will never constitute a threat to any other country… No matter what level of development China reaches, it will never seek hegemony.”
• In Brexit, the cabinet has agreed to implement the government’s no-deal Brexit plans “in full” and that ministers would “ramp up” no-deal planning, with departments expected to make it their main priority –  including reserving ferry space for supplies and putting 3,500 armed forces personnel on standby to deal with any disruption. Businesses and individuals are also being told by the government to prepare for a no-deal Brexit and a publicity campaign will be launched to provide people with the information they need.

STOCK MARKET WRAP 

• Volatility haunted U.S. stock markets again Tuesday as stocks swung dramatically between highs and lows before holding on to a slight gain. Market participants pointed to growing fears of a government shutdown, a slide in oil prices and worries that the Federal Reserve is going too far with its rate-hiking plans as reasons for the weak action. The S&P 500 closed just above its 2018 low Tuesday as stocks struggled to keep a rebound alive throughout the session.
• Stock of energy companies fell across the board as oil prices sank more than 7 percent to a 15-month low on Tuesday as the U.S. and Russia continue to pump at record levels ahead of planned output cuts by OPEC and its allies.
• Shares of Facebook (FB), Apple (AAPL), Amazon (AMZN), Netflix (NFLX) and Google parent Alphabet Inc (GOOGL), collectively known as FAANG, gained between 1.3 percent and 3.1 percent.
• In other corporate news, FedEx (FDX) shares dropped nearly 6 percent during after hours trading Tuesday as the company lowered its full year 2019 earnings guidance but beat expectations this quarter. Adobe Systems Inc. (ADBE) on Thursday reported a 22.8 percent rise in quarterly revenue, helped by higher subscriptions for its flagship Creative Cloud suite of software that includes Photoshop. Micron Technology (MU) shares fell nearly 8 percent in the extended session after the company missed revenue expectations. Boeing Co. (BA) rose 3.8 percent after three days of losses as the aerospace company said it was raising its dividend and increasing share buybacks to US$20 billion from US$18 billion.

The Japanese Financial Services Agency (FSA) has placed cryptocurrencies into a new legal category called “crypto-assets.” By classifying cryptocurrencies like Bitcoin (BTC) this way, the government reportedly “hopes that traders will no longer purchase them believing that they are legal tender recognized by the government.” On Friday, an FSA advisory panel filed a report requesting the term “virtual currency” be changed since, according to the panel, it could confuse people into believing the asset is legal tender in the country. Japan’s FSA is set to introduce new initial coin offering (ICO) regulations to protect investors from fraud. Business operators conducting ICOs will reportedly be required to register with the FSA.

Peter Thiel-Backed Electronic Brokerage Firm Tagomi Launches

According to Chief Executive Officer of Tagomi, Jennifer Campbell, the company aims to ease the operational challenges related to trading digital assets. The company caters to clients that “require institutional operational standards.” Tagomi is an electronic brokerage for digital assets. The firm’s offerings include cross market execution, capital management, post-trading reporting, as well as settlement and custodial services. The firm reportedly raised $16 million from such industry players as Peter Thiel’s Founders Fund that invests in technology companies, seed-stage investment fund SV Angel, private equity and venture capital firm Collaborative Fund, and others. Founders Fund initially announced its plans to invest in Tagomi in May 2018, as reported by WSJ. Thiel reportedly said then that Bitcoin (BTC) could become the digital equivalent of gold, as well as a potential hedge on the market.

A Chinese Government-Controlled Bitcoin Alternative Is Reportedly in the Works

Allegedly, the People’s Bank of China (PBoC) has registered 78 digital currency patents, of which 44 are blockchain related, since at least 2016, ranking the PBoC as the fifth most prolific patenter in the space. The PBoC has also been actively hiring developers and economic specialists for its Beijing-based Digital Currency Institute, whose stated goal is to issue and distribute a blockchain-based currency. The project was originally conceived by the PBoC’s deputy governor Zhou Xiaochuan, with the intention of “protecting” China from Bitcoin, an asset it couldn’t control. The current Deputy Governor of the Bank, Mr. Fan Yifei, announced earlier this year that once implemented, the Chinese-controlled cryptocurrency would replace the country’s fiat currency and would ultimately help the bank curtail risks associated with money laundering and other crimes.

NOTABLE MOVES 

As of Mon, Dec 17, 08:00 GMT (UTC +08:00)

USDJPY, -0.49%, $112.84.
EURUSD, +0.39%, $1.1349.
GBPUSD, +0.24%, $1.2614.
USDCAD, +0.19%, $1.3413    .

S&P500, -2.08%, 2,545.94
Nasdaq, -2.27%, 6,753.73
Nikkei Futures, -0.64%, 21,177.0

CURRENCY MARKET WRAP 

• It was light on the data front with no notable prints on Monday.
• Softening economic data fuelled concerns about the growth outlook and compounded the market’s negative bias. The NAHB Housing Market Index for December fell from 60 to 56, which is its lowest level in nearly four years.  The Empire Manufacturing Index for December, meanwhile, dropped to 10.9 from 23.3. Mounting losses in the stock market have raised the stakes in front of Wednesday’s FOMC announcement, which many participants still think is going to produce another rate hike and at the same time see the Fed temper its rate-hike projections for 2019. Trump yesterday questioned again why the Fed would be raising rates at this time.
• E.U. Final CPI y/y at 1.9% vs expected 2.0%. Final Core CPI y/y inline at 1.0%. Over the weekend, the EU rejected any additional compromise on the Irish backstop issue,  essentially refusing to provide UK with any timeline for withdrawal of EU rules. With most European institutions now headed for the annual Christmas break, negotiations will be on hold until next January and with March deadline fast approaching, the pressure on policymakers is sure to rise. Given the limited time, there appear to be only three scenarios – 1. UK Parliament approves May’s deal, 2. The government gives up and calls a 2nd referendum 3. The situation devolves into a no-deal hard Brexit.

STOCK MARKET WRAP 

• The S&P 500 lost -2.08% on Monday, as uncertainty surrounding a host of issues continued to drive an inclination to sell into strength and to reduce risk exposure to stocks. The benchmark index (2545.94) ran into resistance at the 2600 level amid a morning rebound effort before steadily backpedaling throughout the afternoon and re-testing its February low (2532.69). That re-test invited some late buying interest that enabled the indices to close off their worst levels of the day.
• Influential fund manager, Jeffrey Gundlach, contributed to the bearish price action. In a CNBC interview, he expressed ample concern about the rising U.S. budget deficit, while adding that he thinks passive investing has reached “mania” status and that investors should avoid index funds. Gundlach also said his best idea for 2019 is “capital preservation.”
• Goldman Sachs (GS 168.05, -4.72, -2.7%) underperformed after Malaysian authorities reportedly filed criminal charges against Goldman Sachs related to the 1MDB scandal. The health care sector (-2.1%) for its part fell amid the uncertainty attached to a ruling by a federal judge in Texas that the Affordable Care Act is unconstitutional. That decision will head to an Appeals Court and most experts believe it is ultimately headed to the Supreme Court.  Xerox (XRX 21.29, -3.16) was the biggest laggard in the S&P 500 with a loss of -12.9% after Moody’s cut Xerox’s senior unsecured debt ratings to Ba1 from Baa3. The cut from investment grade to junk status was due to an uncertain revenue base amid a decline in demand for copy and printing services as well as intense global competition, according to Bloomberg.

Ethereum Unique Addresses Break 50 Million, Active Wallet Number Keeps Dropping

The number of unique Ethereum (ETH) wallet addresses has broken 50 million on Saturday, Dec. 15. On Saturday, the Ethereum network saw a daily increase of 168,506 unique crypto wallets, following a steady growing trend this year. With that, the highest historical daily growth of unique Ethereum addresses took place on Jan. 4, 2018, with 352,888 new addresses created on the Ethereum network. the number of active Ethereum addresses has been decreasing steadily throughout 2018. Having peaked at around 1.1 million on Jan. 4, 2018, the amount of active Ethereum addresses has dropped below 1 million in mid-January, and has fallen by around 70 percent over the year — to 328,400 addresses recorded yesterday, Dec. 16. The latest recorded number of unique Bitcoin (BTC) wallets accounted for 364,387 on Dec. 15, down from around 1 million on Jan. 3, 2018. The number of active BTC addresses amounts to around 461,000, as recorded yesterday, Dec. 16

Over 400,000 ETH Left ICO Team Wallets in the Past Thirty Days, Data Shows

Initial coin offerings (ICO) have been transacting Ethereum (ETH) at breakneck speed, with over 400,000 ETH moving out of wallets in the past 30 days alone, according to data from crypto assets data and software development firm Santiment published Dec. 17. Santiment’s data sample notably does not track the ETH “all the way to exchanges,” with the metric therefore not a hard and fast confirmation that the ETH has necessarily subsequently been sold. Santiment gives a breakdown of the specific wallets in its sample, ranking the ICO teams according to the amount of ETH “spent” over the thirty-day period. According to its rankings, SingularDTV — a blockchain platform for the entertainment industry — came top out of a total of 39 projects, “spending” 60,370 ETH since mid November: the team wallet still holds around 165, 000 ETH, having reportedly raised an initial 585,430.62 ETH in its token sale. Other major ICO ETH “sellers” this past month are Aragon (50,000 ETH), Kyber Network (47,290 ETH), Friendz (40,870 ETH) and Status (40,000 ETH).

German State Bank KfW Tests Blockchain App for Public Finance Management in Burkina Faso

Germany’s major state-owned bank KfW and Burkina Faso’s Ministry of Finance will test a blockchain application for use in public financial management. According to the recent blockchain-related announcement, TruBudget, an open source app developed by KfW, will be tested in Burkina Faso, Africa within the next six months with the assistance of global consulting companies Accenture and BearingPoint. The application will allow users to store and approve all the contracts in the sector using blockchain in real-time mode. The bank expects it could help reduce lengthy manual processes and ensure that funds are used properly. KfQ, ranked in 2017 as the country’s third largest bank by total assets, had also previously signed an agreement with the Burkinabe government in June 2018, providing the country with a credit of €7 million ($7.9 million) to finance water supply and sanitation areas.

NOTABLE MOVES 

As of Fri, Dec 14, 08:00 GMT (UTC +08:00)

USDJPY, -0.22%, $113.39.
EURUSD, -0.48%, $1.1309.
GBPUSD, -0.58%, $1.2584.
USDCAD, +0.24%, $1.3384.
AUDUSD, -0.69%, $0.7177.

S&P500, -1.91%, 2,599.95
Nasdaq, -2.26%, 6,910.66
Nikkei Futures, -2.52%, 21,300.0

CURRENCY MARKET WRAP 

• U.S. Core Retail Sales m/m inline at 0.2%. Retail Sales m/m at 0.2% vs expected 0.1%. Investors sought safety in U.S. Treasuries, pushing yields lower across the curve. The 2-yr yield lost three basis points to 2.73%, and the 10-yr yield lost two basis points to 2.89%. Also, the U.S. Dollar Index rose 0.4% to 97.45, nearing a yearly high.
• German Flash Manufacturing PMI at 51.5 vs expected 51.8. German Flash Services PMI at 52.5 vs expected 53.4. E.U. Flash Manufacturing PMI at 51.4 vs expected 51.9. Flash Services PMI at 51.4 vs expected 53.4.
• Chinese Fixed Asset Investment y/y inline at 5.9%. Industrial Production y/y at 5.4% vs expected 5.9%. Retail Sales at 8.1% vs expected 8.8%. The selling in risk assets started after China reported underwhelming results.

STOCK MARKET WRAP 

• The selling started overseas when China, the second-largest economy in the world, reported some weaker-than-expected industrial production and retail sales data. In addition, some weaker-than-expected preliminary manufacturing PMI readings out of the eurozonehelped feed into concerns over economic growth and corporate earnings prospects. A solid November Retail Sales report out of the U.S. didn’t change the selling bias either.  Instead, the good news on that front was drowned out by the concern that weakness abroad will eventually lead to a slower pace of growth in the U.S.
• Selling picked up after the close of the European markets (11:30 a.m. ET) and would continue in an orderly manner throughout the day, culminating in the S&P 500 closing just below 2600.Johnson & Johnson (JNJ 132.80, -14.84) dropped -10.0% after a Reuters report alleged that JNJ “knew for decades that asbestos lurked in its baby Powder.” The company’s litigation counsel rejected the report as “false and misleading.” Within tech, Apple (AAPL 165.48, -5.47, -3.2%) fell after an influential analyst from TF International Securities cut his first quarter 2019 iPhone shipment estimate by 20%, according to CNBC; Adobe Systems (ADBE 230.00, -18.08, -7.3%) fell after failing to overly impress investors with its fiscal fourth quarter results and outlook; and Cisco (CSCO 45.82, -1.65, -3.5%) fell after being downgraded to ‘Neutral’ from ‘Buy’ at Nomura. In other corporate news, Costco (COST 207.06, -19.45) fell -8.6% after reporting its fiscal Q1 results, which included revenues that were slightly below consensus. Margin weakness, attributed to higher merchandising costs, also weighed on the stock.
• There were some conciliatory headline developments last week on the trade dispute between the U.S. and China. In particular, high-ranking U.S. and Chinese officials resumed trade discussions over the phone; and China is reportedly looking to tweak its “Made in China 2025” policy to allow more access and fairer competition for foreign companies. Separately, China confirmed it will temporarily reduce its U.S auto import tariffs by 25% (to 15% from 40%) between January 1 and March 31, as both sides continue to work on a deal,  and Trump told Reuters he would get involved in the Department of Justice case against Huawei CFO Meng Wanzhou, who was granted bail Tuesday, if it would serve national security interests and help advance trade negotiations with China.

 

Blockchain Payments’ Mass Adoption Is 3-5 Years Away, Says BitPay CEO

The CEO of crypto merchant platform BitPay Stephen Pair stated that speculation on future adoption drives Bitcoin’s (BTC) price more than “actual utility.” “A very big component of the [Bitcoin’s] price is certainly speculation. It’s investors that are speculating on the future usage and adoption of this technology. I’m sure a small component of that price is the actual utility.” When asked about a Bitcoin ETF’s potential to stimulate a price rally, Pair argued that “not just ETF adoption or ETF launches” could be catalysts for price movement, but that “adoption will push the prices higher.” According to Hester Peirce, a commissioner for the United States Securities and Exchange Commission (SEC), the approval of a Bitcoin ETF is not necessarily close at hand. Peirce said that an approval “could be 20 years from now” or “tomorrow,” urging the crypto community to not “ hold [its] breath.”

Blockchain Incubator Binance Labs Releases First ‘Batch’ of Blockchain Projects

Binance Labs, the venture wing of the largest cryptocurrency exchange Binance, has released its first “batch” of blockchain projects from its Incubation Program. Binance Labs selected only eight projects, out of the more than 500 applicants, each of which received $500,000 in seed funding and access to necessary resources and mentors. Over the course of the 10-week program, seven projects have shipped working products and signed on users, while three of those teams have paying customers. Among others, the eight projects selected by Binance Labs include hardware wallet SafePal, fictionless logins for decentralized apps (DApps) Torus, Internet security project Nym, and market prediction startup Deaux. Binance Labs is an initiative that seeks to help early-stage blockchain and digital assets projects and entrepreneurs through direct investments and technical assistance. The Binance Labs Incubation Program is an onsite program that was launched in August 2018.

Ethereum-Based Chat Platform Lays Off 25% of Staff Due to Crypto Market Decline

Ethereum (ETH)-based chat platform Status is laying off 25 percent of its staff due to the recent cryptocurrency market decline. According to Status, 25 percent of its staff is “non-essential” to the company’s long-term growth projects, and are therefore being laid off. Remaining employees have been asked to take a paycut and will purportedly be given a sum of Status’ native virtual currency SNT “to help offset the cut and align with the network’s success.” In order to set up a “runway measured in years,” Status is going to tap into its remaining fiat money and “large” ETH holdings. The startup has also asked remaining employees to actively contribute to the development of its two priority projects, which are to “deliver on white paper promises” and get the app to a “usable state.”

NOTABLE MOVES 

As of Thu, Dec 13, 08:00 GMT (UTC +08:00)

USDJPY, +0.26%, $113.57.
EURUSD, -0.04%, $1.1363.
GBPUSD, +0.18%, $1.2654.

S&P500, -0.02%, 2,650.54
Nasdaq, -0.39%, 7,070.33
Nikkei Futures, -0.22%, 21,612.5

CURRENCY MARKET WRAP 

• U.S. Unemployment Claims at 206K vs expected 226K. Import Prices m/m at -1.6% vs expected -1.0%, the takeaway from the report is that inflation trends could be in a topping phase, which is constructive in terms of market’s belief that the Fed is keen to take a more conservative path with future rate hikes.
• ECB Main Refinancing Rate inline at 0.00%. On Thursday, Mario Draghi joined most of the world’s other big central bankers in halting crisis-era stimulus programmes, announcing that the ECB would call time on its own €2.6tn bond-buying scheme. Though the ECB remains poised to react again quickly if growth goes into a sustained period of weakness and wage and consumer price inflation start to head downwards again. The central bank  gave itself the flexibility by announcing it would reinvest fully bonds that come due to maintain the stock.
• In Brexit, May continues to face a monumental task of trying to pass her deal through Parliament, but with the vote now delayed until mid-January she has time to wring further concessions from EU. The whole Brexit deal now rests on the Irish backstop issue which essentially comes down to whether Northern Ireland will fall under EU rules in perpetuity or whether UK will be able to assert control over the territory sometime in the future. For the time being markets continue to bet that cooler heads will prevail and that the UK will remain within the customs union in 2019, but the chaos and turmoil of British politics have undermined investor confidence and traders remain wary.

STOCK MARKET WRAP 

• U.S. major indices finished mixed on Thursday, as ongoing uncertainty surrounding global issues kept many buyers on the sidelines.
• Procter & Gamble (PG 96.49, +2.46, +2.6%) was a standout in the consumer staples sector, and Dow, after being upgraded to ‘Buy’ from ‘Neutral’ at Bank of America/Merrill Lynch. Retail stocks were one of the hardest hit groups on Thursday, which helped drive the weakness in the consumer discretionary (-0.4%) sector. The SPDR S&P Retail ETF (XRT 42.52, -1.17) lost -2.7%. On a related note, Tailored Brands (TLRD 14.13, -6.01) and Oxford Industries (OXM 67.24, -7.57) dropped -29.8% and -10.1%, respectively, after some disappointing guidance/outlook.

 

PwC Partners With BitFury to Create Blockchain Accelerator in Russia
PricewaterhouseCoopers (PwC) has partnered with mining and blockchain software company Bitfury Group to create a blockchain accelerator for businesses in Russia. The consulting firm hasalready used Exonum — Bitfury’s open source framework for building blockchain applications for educational courses and seminars. The main goal of the new accelerator is to meet the “current needs” of the consulting giant’s enterprise clients in Russia. The company also believes that blockchain can “drastically” change the modern economy and cut personnel and infrastructure costs with the automation of business processes. With a revenue totalling over $41 billion for the 2018 fiscal year, PwC is currently the second largest among the Big Four professional services firms.

 

Hyperledger Onboards 12 New Members Including Alibaba Cloud, Deutsche Telekom and Citi
Hyperledger has onboarded 12 new members, including such major firms as Alibaba Cloud, Citi, and Deutsche Telekom. Launched in 2016, Hyperledger is an open source project created by the Linux Foundation and created to support the development of blockchain-based distributed ledgers. The latest general members that joined the initiative include Alibaba Cloud, a subsidiary of the e-commerce giant; financial services firm Citigroup, Deutsche Telekom, one of the largest telecoms providers in Europe; and European blockchain trading platform we.trade, among others. This month, the Hyperledger Technical Steering Committee approved the Ursa project, a modular cryptography software library. Ursa is meant to avoid wasted work on duplicate projects, enhancing security by simplifying analysis and making it “less likely for less experienced people to create their own less secure implementations.”

Opera Releases ‘Web 3-Ready’ Android Browser With Ethereum, DApp Support
Opera has launched its “Web 3-ready” browser for Android, with crypto wallet integration, support for Ethereum (ETH) and interactions with decentralized applications (DApps). Hamel explained Opera’s choice to support Ethereum and the Ethereum Web3 API as being based on the perception that the protocol “has the largest community of developers building Dapps” and significant “momentum behind it.” “Web 3.0” is a term that was initially coined to refer to the ambition for the development of a semantic internet, and is used to refer to the evolution of a more intelligent, open and distributed internet, which could involve the use of blockchain, decentralized computing and cryptocurrencies. Opera first announced it would be integrating a built-in crypto wallet for its desktop browser in early August, after launching a mobile crypto wallet as part of its beta Opera for Android in July. In September, the firm released an interoperable “Labs” beta version for Android with integrated wallet, Web 3.0 and DApp functionality.

 

As of Wed, Dec 12, 08:00 GMT (UTC +08:00)

USDJPY, -0.10%, $113.28.
EURUSD, +0.50%, $1.1373.
GBPUSD, +1.11%, $1.2624.
USDCAD, -0.30%, $1.3350.

S&P500, +0.54%, 2,651.07
Nasdaq, +0.95%, 7,098.31
Nikkei Futures, +2.64%, 21,687.5

CURRENCY MARKET WRAP 

• U.S. CPI m/m inline at 0.0%. Core CPI m/m inline at 0.2%. Japanese PPI y/y at 2.3% vs expected 2.4%. Consumer inflation trends are not running away from the Fed’s longer-run target, which should feed into the market’s growing belief that the Fed has some data-based scope to take it easy after a December rate hike.
• Italian PM Conte presented EU’s Juncker a revised 2019 budget plan with a target deficit of 2.04%. The Italian government and the commission have been at loggerheads over Rome’s spending plans, leading to the EU threatening to fine the country for “a particularly serious case of non-compliance” with EU fiscal rules.
• In Brexit, Prime Minister Theresa May won a “no confidence” vote from her own Conservative Party with respect to her leadership. The vote came amid the heightened uncertainty surrounding the UK’s Brexit plan. In a statement made shortly after the vote, May acknowledged that although she won, a significant number of her party colleagues had cast ballots against her leadership.

STOCK MARKET WRAP 

• The S&P 500 rose 0.54% on Wednesday, although it gave up a good chunk of its gains in the afternoon after trading as high as 1.9% intraday. Optimism that trade relations between the U.S. and China were progressing fuelled the rally effort, but selling would accelerate into the close, leaving the benchmark index at its session low. Trump initiated the optimism when he told Reuters he would get involved in the Department of Justice case against Huawei CFO Meng Wanzhou if it would serve national security interests and help advance trade negotiations with China. U.S. Secretary of Commerce Wilbur Ross later softened the President’s language, though, clarifying he hasn’t actually decided if he would intervene. Also, news thatChina is reportedly looking to tweak its “Made in China 2025” policy to allow more access and fairer competition for foreign companies helped lift sentiment.
• Notable laggards included Dow components Exxon Mobil (XOM 76.02, -0.66, -0.9%) and Verizon(VZ 57.25, -1.60, -2.7%). Exxon fell as oil prices rolled over, and Verizon was downgraded to ‘Equal-Weight’ from ‘Overweight’ at Morgan Stanley. Under Armour (UAA 19.81, -2.31, -10.4%) also stood out as the worst-performing stock in the S&P 500 after the company provided a disappointing revenue growth outlook for its core North American market between 2020 and 2022 at its Investor Day.

 

Developers Test Cross-Blockchain Protocol for One-Way ERC20-Bitcoin LN Atomic Swaps

An R&D lab at crypto startup TenX has tested the use of its cross-blockchain interoperability protocol to transfer ERC20 tokens for Bitcoin (BTC) using the Lightning Network (LN). The technical challenge was to exchange ERC-20 tokens which run on the Ethereum (ETH) platform but are not strictly “native” since they rely on invoking a smart contract to transfer ownership for Bitcoin’s smallest transactable unit, known as “Satoshi,” using the second-layer scalability LN protocol. The ERC20 transfer function uses msg.sender for authentication. However, calling transfer from a contract deployment sets msg.sender to the address of the yet to be deployed contract which doesn’t have tokens. CoBlox states it is still “looking at ways” to resolve the limited directionality issue, and has therefore not included the results of its proof-of-concept (PoC) for ERC20 tokens as part of the open-source release of its COMIT network.

China: Shenzhen Special Economic Zone to Use Blockchain for Electronic Tax Invoices

Shenzhen, a major city in the Guangdong Province and the first economic special zone in China, will allegedly use blockchain technology for electronic tax invoices. According to the director of the Information Center of Shenzhen Taxation Bureau, a blockchain electronic invoice is different from a traditional electronic invoice, as it has “the advantages of ‘distributed’ storage, traceability and non-tamperability.” The application of the blockchain electronic invoice to the WeChat payment platform is a substantial exploration made by the Shenzhen Tax Department based on the actual needs of the taxpayers to further optimize the business environment. WeChat, the 1 billion user social media platform operated by Tencent, has opened its payment platform for the blockchain invoice function.

Canadian City of Calgary Launches Local Digital Currency for Intracity Transactions

Calgary, a city in the Canadian province of Alberta, has launched its own digital currency. The Calgary Dollar will allow holders to pay for services and goods at local shops. the Calgary dollar was initially launched in 1996, with citizens and businesses offering goods and services in exchange for the local currency alongside the Canadian dollar. This new move in 2018 allows citizens to download an app and store the digital currency on their devices. The officials expect that the Calgary dollar could support small businesses and nonprofits by keeping funds within the city. Calgary dollars work through a smartphone app that lists shops and restaurants that participate in the program. One way to obtain the currency is by posting ads for goods and services that users want to sell in the app or on project’s website for Calgary dollars, receiving a small amount of the digital currency in exchange for posting the ad. Calgary is reportedly the first city in Canada to launch its own coin.

 

NOTABLE MOVES 

As of Tue, Dec 11, 08:00 GMT (UTC +08:00)

USDJPY, +0.04%, $113.38.
EURUSD, -0.30%, $1.1322.
GBPUSD, -0.55%, $1.2492.
USDCAD, -0.12%, $1.3379.
AUDUSD, +0.32%, $0.7213.

S&P500, -0.04%, 2,636.78
Nasdaq, +0.16%, 7,031.83
Nikkei Futures, +0.75%, 21,297.5

CURRENCY MARKET WRAP 

• U.S. PPI m/m at 0.1% vs expected 0.0%. Core PPI m/m at 0.3% vs expected 0.1%. The key takeaway from the report is that it didn’t inflame inflation concerns to an alarming degree, like the October report did, so market participants have not been bothered by the idea that it will drive the Fed to be overly aggressive with future rate hikes.
• German ZEW Economic Sentiment at -17.5 vs expected -25.0. In the Union, Italy’s Finance Minister Tria said that the government isn’t planning major changes to the budget, ahead of a meeting between EU’s Juncker and Italy’s PM Conte later today. Also, French President Macron is facing a non-confidence vote from left-wing opposition after riots took over Paris.
• In London trading, Sterling was boosted by some comments from Irish Deputy Prime Minister Simon Coveney, who said that there is potential for a new statement from the EU on the Irish backstop, although clarifying it’s not going to change. Later in the day, news that Germany’s Merkel rejected UK’s May attempt to renegotiate the Brexit deal and renewed speculation that MPs have sent 48 letters for a non-confidence vote on PM May, took Sterling down on the day. Data held little interest for the market as all eyes remain on the Brexit negotiations. U.K. Average Earnings Index 3m/y at 3.3% vs expected 3.0%. Unemployment Rate inline at 4.1%.
• Aussie HPI q/q inline at -1.5%. News that US and Chinese negotiators had some productive discussions on trade, kicked things off in Asia with AUDUSD popping above the 0.7200 figure on hopes that some sort of deal could be worked out over the next several months.

STOCK MARKET WRAP 

• Stocks jumped in early morning trading amid news that high-ranking officials from the U.S. and China resumed trade discussions over the phone. The progress stirred up some optimism that the controversial arrest of Huawei Technologies CFO, Meng Wanzhou, would not impede trade negotiations as was previously feared. The S&P 500 finished flat on Tuesday, squandering two intraday rally efforts, as headline volatility surrounding politics and trade contributed to another day of whipsaw trading action. The benchmark S&P 500 index traded as high as 1.4% shortly after the start of trading, but surrendered the entirety of that gain and was down as much as -0.6% in the afternoon.  It mounted a late recovery charge, trading up as much as 0.8%, but then rolled over in the last 30 minutes. The Wall Street Journal reported that China verbally agreed to reduce U.S. import auto tariffs to 15% from 40%, which followed a Bloomberg article from the morning that said China had submitted a proposal to reduce the tariffs. General Motors (GM 34.69, +0.27, +0.8%) and Ford Motor (F 8.54, +0.02, +0.2%) reacted favorably to the news.