Coin Bytes

The US Federal Reserve is seeking public feedback on its planned “payment account,” termed a “skinny master account,” which is appealing to fintechs and crypto firms because it would give access to the central bank without the requirement for traditional approvals. “These new payment accounts would support innovation while keeping the payments system safe,” Federal Reserve Governor Christopher Waller said on Friday. In October, Waller proposed that the Fed investigate the possibility of establishing payment accounts to clear and settle certain transaction operations of qualifying financial institutions. Waller noted that the Fed is adopting the payment accounts feature to reflect “rapid developments” in the payments industry, which have resulted in “innovative approaches to banking” and new business models.

Coinbase is suing three US states in an effort to secure federal protection for its planned prediction markets, igniting a new front in the debate over whether event contracts are financial or gambling. The exchange has sued regulators in Connecticut, Illinois, and Michigan, requesting that prediction markets listed on a CFTC-regulated platform fall under the CEA and the CFTC’s exclusive jurisdiction, rather than 50 state gambling codes. In a Friday X post, Chief Legal Officer Paul Grewal stated that Coinbase filed the cases “to confirm what is clear: prediction markets fall squarely under the jurisdiction of the CFTC, not any individual state gaming regulator (let alone 50).” ​

Raoul Pal, founder and macro investor at Real Vision, believes that the current spike in privacy-focused cryptocurrency Zcash may be driven more by capital rotation than a persistent structural bull market. “Do I need that asset to say I was there first? Pal told Kevin Follonier on the “When Shift Happens” podcast published on Thursday that he doesn’t really know. Zcash, a privacy-focused coin, has seen strong gains this year. However, it is unclear if this is the start of a larger uptrend, according to Pal. “We can’t prove it until the whole market goes up and it continues to trend and not a rotation,” he indicated. “Right now it’s confirming the rotation thesis.”

Over the past 60 years, the US dollar’s influence in international bond markets has fluctuated, with no discernible long-term trend towards either increased dollar dominance or de-dollarization, according to a recent Federal Reserve discussion paper. The authors find three separate “dollarization waves” since the 1960s using the Bank for International Settlements’ (BIS) international debt securities database, demonstrating that changes in currency use have followed cyclical patterns rather than a constant structural change in global financing. The study states, “We find no monotonic dollarization or de-dollarization trend; instead, the dollar’s share exhibits a wavelike pattern.”

U.S. inflation jumps less than predicted in November, but remains above the Federal Reserve’s target, according to the first set of pricing data published since the government shutdown ended in mid-November. According to Bureau of Labour Statistics (BLS) statistics released on Thursday, the U.S. consumer price index grew 2.7% on an annualised basis in November, down from 3.0% in September and falling short of the predicted 3.1% increase. The so-called core reading, which excludes volatile goods such as food and energy, increased 2.6% year on year, falling short of the expected 3.0% gain. Bitcoin rose over 1% to $88,703.93 after the release of the data.

China’s increasing crackdown in Xinjiang has shut down some 400,000 ASICs, resulting in a 10% decrease in Bitcoin’s hashrate and forcing miners to sell at a record-low hash price. Approximately 400,000 Xinjiang mining machines have gone offline due to China’s new laws, which has resulted in an 8–10% decrease in Bitcoin’s network hashrate. Analysts assert that Asian miners and holders started dumping weeks ago, despite Luxor data showing the hash price at all-time lows and three straight negative difficulty adjustments. As miners unload coins and gear on Asian exchanges while U.S. venues maintain net purchasing, Bitcoin is nearing the bottom of its late-November range. I

The World Liberty Financial team has proposed investing 5% of the project’s treasury to promote the USD1 stablecoin through strategic partnerships and ecosystem incentives. According to a proposal filed on the World Liberty Financial Governance forum, the Trump family-backed project wants to expand USD1 supply, which it says will directly enable “demand for WLFI-governed services, integrations, liquidity incentives, and ecosystem programs.” “The success of USD1 directly strengthens WLFI because USD1 adoption expands the overall footprint, utility, and economic activity of the entire WLFI ecosystem,” they stated.

Coinbase has introduced a new bespoke stablecoin product, which enables partners to create their own branded stablecoins with customisable collateral arrangements. These tokens can be backed by assets such as USDC, offering businesses more choice over how their stablecoins are organised while remaining on a trusted, regulated network. The move is intended at organisations, fintechs, and platforms who want to incorporate stablecoins for payments, settlements, and on-chain financial services without having to create everything from scratch. Coinbase is positioning itself as a significant infrastructure provider in the digital payments industry by increasing stablecoin customisation, hence accelerating the widespread use of stablecoins throughout global financial systems.

The U.S. Federal Reserve has lifted a 2023 guidance that restricted how Fed-supervised banks, including uninsured ones, dealt with cryptocurrency, as regulators continue to favour digital assets. The 2023 guidance required uninsured banks to follow the same standards as federally insured institutions, based on the premise that similar activities pose similar risks and should be subject to the same regulation. This prevented uninsured banks from engaging in activities prohibited for national banks, such as crypto services, which instantly excluded the Fed from membership because the institution’s principal activities were not permitted.

After a $206 million IPO, HashKey, the biggest cryptocurrency exchange in Hong Kong, began trading on the Stock Exchange of Hong Kong (HKEX).
According to exchange data, HashKey Holdings shares formally debuted on the HKEX main board on Wednesday, opening at 6.70 Hong Kong dollars ($0.86). The exchange became the first publicly listed digital asset company in Asia to go public through an IPO in Hong Kong, according to a blog post made by HashKey Group.
The company said, “This milestone establishes a stronger foundation for its global expansion and long-term strategic initiatives and marks the company’s entry into a new stage of development.”