Seeds of Wisdom RV and Economic Updates Friday Evening 1-3-25
Good Evening Dinar Recaps,
BEARS, BULLS AND REGULATIONS SHAPE CRYPTO’S 2025 ASPIRATIONS
The global cryptocurrency market is capitalized at over $3 trillion. Much of that value is concentrated at the top, among a few key digital tokens.
Bitcoin, as the first and most widely recognized cryptocurrency, plays a central role in the sector’s valuation, commanding a substantial share. At its highest, bitcoin’s market capitalization has approached $2 trillion, representing roughly two-thirds of the landscape’s overall market value.
Bitcoin topped $100,000 as 2024 came to a close, but has skidded down double digits from its peak of over $108,000 around two weeks ago.
This concentration of value at the top has implications for the overall market’s volatility, innovation and the evolution of altcoins, with bitcoin often setting the tone for broader market trends. It also raises questions about the future of crypto market dynamics as new technologies and use cases continue to emerge.
With the news that the Tether stablecoin’s (USDT) market cap fell more than 1% to $137.24 billion this week, the largest decline since the crash of the FTX exchange in November 2022, understanding the impact of regulations on the marketplace is becoming crucial for businesses looking to capture efficiencies and advantages from the use of tokens such as stablecoins.
After all, USDT is supposed to maintain a stable, flat value of $1. As of reporting, the stablecoin is a smidge below that value, sitting at $0.9993. The decline comes after several European Union-based crypto exchanges removed USDT due to compliance issues with the EU’s Markets in Crypto-Assets (MiCA) regulation that took full effect on Dec. 30 (the actual law around stablecoins kicked in six months ago).
Per the MiCA regulations, stablecoin issuers must hold an e-money license in at least one EU member state in order to operate across the 27-nation bloc. Tether, which has faced controversy throughout its history, has yet to apply for an e-money license.
The Role of Institutional Adoption
In 2025, the cryptocurrency market may find itself at a crossroads. If the bulls are right, the industry could see substantial growth, with more institutional investment, regulatory clarity and real-world use cases for cryptocurrencies
However, if the bears prevail, we may witness a volatile market, regulatory crackdowns and a continued struggle to overcome the technology’s shortcomings.
The bullish optimism surrounding institutional adoption is one of the strongest driving forces. In 2025, financial institutions, banks and even central banks are expected to play a significant role in legitimizing cryptocurrencies.
Global financial giants are already eyeing blockchain for solutions like cross-border payments and settlement systems, providing liquidity for crypto markets and solidifying their utility in traditional finance.
Stablecoins — digital currencies pegged to traditional assets like the U.S. dollar — are likely to become a common mode of transaction. With major players in FinTech, like PayPal and Visa, already integrating cryptocurrencies into their platforms and experimenting with stablecoins, real-world use cases could soon be as easy as tapping a credit card.
The Bearish Argument: Volatility, Regulatory Shadows
Perhaps the biggest concern for crypto’s future is government regulation. The lack of clear rules around cryptocurrencies has been a major deterrent for mainstream adoption.
PYMNTS covered on Nov. 25 how cryptocurrencies, and more specifically their underlying blockchain technologies, have gone from a solution in search of a problem to a solution in hopes of some regulatory clarity. Of course, that clarity may come when cryptocurrency companies and other firms embrace and invest in, rather than resist, appropriate guardrails for their industries.
The dynamic situation at home in the U.S. has even led to people like venture capitalist Marc Andreessen arguing that banks are cutting ties with customers on the political right, or with industries such as the cryptocurrency sector.
Writing about the issue earlier this month, PYMNTS argued that while Andreessen’s claims might resonate with the frustrations held by many corners of the cryptocurrency and FinTech sectors, the reality could be far more nuanced than a political assault on those industries.
“After all, innovation typically moves faster than regulation, and the growing strain between traditional banks and future-fit FinTech and crypto firms can also be in part chalked up to the inevitable consequence of outdated regulatory frameworks, stricter know your customer (KYC) and anti-money laundering (AML) standards, as well as heightened fraud risks,” that report said.
@ Newshounds News™
Source: Pymnts
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WESTERN MARKETS LOSING THEIR GRIP ON GOLD & SILVER
Precious metals expert Peter Grandich warns of Western markets losing their grip on gold and silver, with Asia emerging as the dominant force.
In a recent interview by Liberty and Finance, renowned precious metals expert Peter Grandich discussed the shifting dynamics of the global gold and silver markets. Grandich, a seasoned investor with decades of experience, highlighted the diminishing influence of Western markets like London and New York, asserting that "Asia is becoming the center for Metals trading... Europe particularly London and New York as each day goes by is becoming less and less of a force."
This shift, he argued, could have profound implications for market volatility and price discovery. "The difference is there are serious physical buyers of it [gold], not these paper pushers that have existed in London and New York," Grandich emphasized. He further noted that the decline of Western dominance could lead to reduced market manipulation and increased price stability in the long run.
Bullish on Gold, Cautious on Silver
Grandich maintained a bullish outlook on gold, predicting a potential price target of $3,000 per ounce in 2025. He attributed this bullish sentiment to continued central bank buying and the potential for increased mainstream investor interest. However, he cautioned that a correction, potentially reaching $2,300, could occur in the short term.
Regarding silver, Grandich acknowledged its strong fundamentals but expressed concern over its persistent inability to decouple from gold's price movements. He believes that silver needs to break above the $35-$36 per ounce level to establish its momentum.
Geopolitical Uncertainty and the US Dollar
Grandich highlighted the potential impact of geopolitical uncertainty and the weakening US dollar on precious metals prices. He emphasized that the rising national debt and the ongoing trade war could weaken the dollar's strength, bolstering the appeal of gold as a safe-haven asset.
Beyond market predictions, Grandich stressed the importance of sound financial planning, emphasizing the need for individuals to prioritize cash flow management and reduce reliance on debt. "Less is more," he stated, emphasizing the importance of living within one's means and minimizing financial risk.
@ Newshounds News™
Source: The Jerusalem Post
Watch: Youtube
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