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RIYADH: Bitcoin, the leading cryptocurrency internationally, traded higher on Thursday, rising by 6.13 percent to $24,406 as of 7:46 a.m. Riyadh time.
Ethereum, the second most traded cryptocurrency, was priced at $1,886 rising by 12.09 percent, according to data from Coindesk.
Binance wins crypto clients due to inflation
A high dollar and rising inflation, coupled with a depressed emerging market currency, are causing Binance, the world’s largest cryptocurrency exchange, to experience an uptick in clients, according to Reuters.
Maximiliano Hinz, who heads Binance in Latin America told Reuters: “Now that we are seeing inflation ramping up worldwide, we are seeing that more and more people are seeking cryptocurrency, like Bitcoin, as a way to protect themselves from inflation.”
As an example, Hinz cited Argentina, where annual inflation is 90 percent. Together with Brazil and Mexico, the country has become one of the company’s top markets.
A fall in cryptocurrency prices did not stop Argentina’s citizens from investing their savings in Bitcoin this year.
Hinz said that while El Salvador adopted Bitcoin as legal tender, other Latin American nations have not passed meaningful cryptocurrency laws, although that may not necessarily be bad for his company.
“Regulation is a framework, but it’s not always negative that something isn’t regulated,” he said. “If something isn’t banned, then it’s legal.”
As a result of President Nayib Bukele’s massive bet on Bitcoin, El Salvador has made the cryptocurrency legal tender and purchased more than $100 million worth of it.
However, Bitcoin has lost about 50 percent of its value amid a broader cryptocurrency selloff.
Cryptocurrencies have important roles in the metaverse, Bank of England Analysts say
Bank of England’s analysts said crypto assets could have important roles within the metaverse, according to Bitcoin.com.
They added that, “widespread adoption of crypto in the metaverse … would require compliance with robust consumer protection and financial stability regulatory frameworks.”
In a blog post published Tuesday, economist Owen Lock and policy analyst Teresa Cascino discussed crypto assets, the metaverse, and systemic risk.
“Cryptoassets could have important roles within the metaverse,” the blog said.
The risks associated with crypto assets may scale up to have a systemic financial stability impact if an open and decentralized metaverse grows.
“Widespread adoption of crypto in the metaverse, or any other setting would require compliance with robust consumer protection and financial stability regulatory frameworks,” they said.
In order for the open metaverse to exist, there needs to be a way to own and transact interoperable digital objects between virtual worlds, Lock and Cascino explained, noting that “cryptoassets are well suited to play an important role here.”
“If a sizable open-metaverse materialized, households may hold a greater share of their wealth in crypto assets to make metaverse-based payments or for investment purposes,” they said.
A growing open-metaverse may improve the investment prospects of crypto assets and their supporting infrastructure, according to the authors.