?? The Bitcoin Roller Coaster

Ola Crunchers,

Checking in from Faro (in the Algarve region in Portugal) where I am attending our Annual Partners Meetings. Arrived here yesterday evening after a 8 hour drive from Madrid and spent a pleasant evening meeting people who I had only known virtually.

Now, back to Crunch.....

If you've been following the bitcoin these past couple of months, I am sure the rollercoaster life has been extremely unpleasant (in some cases, nausea inducing).

For a while, it seemed like the sky was the limit for this digital currency... But just as quickly as it rose, bitcoin's price came crashing back down to earth. So what's the verdict? Let's take a closer look at what's been going on with bitcoin lately. It's later in this edition.

YESTERDAY’S MARKET MOVES

SOME FAMILIAR FINTECH STOCKS

Note: The variance captures DoD movement in the price.

WHAT’S NEW IN FINTECH?

• Leading merchant commerce platform Pine Labs announced that it’s acquiring Bengaluru-based Setu, a fast-growing API fintech startup. This is the third acquisition announced by Pine Labs this year.

• Fintech investors appear to be favoring later-stage deals as the sector takes a hit, recent data shows.

• Fintech startups in Egypt have raised $167 million in the first half of 2022. The funds were collected in 31 transactions with about 90% of them being series A and B fundings.

• The Finance Ministry of India is asking public sector banks to explore fintech partnerships and co-lending opportunities to expand their business.

The Bitcoin Roller Coaster

Having lost more than two-thirds of its value since November, is the Bitcoin price at its bottom or is there more to give? When will cryptos see a bottom?

Although the Bitcoin price is up marginally since this time yesterday and over the last 5 days, but overall, Bitcoin remains is down about 70% from its 10 November all-time high and down 57% so far in 2022.

Lets start with the fact that it’s not just the Bitcoin price that’s taking a beating this year. Almost every top crypto has been sold off heavily with some, like the TerraUSD stablecoin, collapsing completely. This has seen the total global crypto?market cap?fall from approximately US$3 trillion in November last year to some US$1 trillion today. The biggest factor pressuring cryptos has been hot-running?inflation?and the accompanying interest rate hikes needed to cool fast-rising prices down.

While tightening by the RBA and other global central banks all contribute to the impact, it’s the US Federal Reserve that’s most closely watched. Recent outsized interest rate hikes by the US Fed have contributed to a 30% year-to-date decline in the tech-heavy NASDAQ.

So the trillion-dollar question is: Should you buy crypto now??

Analysts at Informa Global Markets say crypto investors will need to wait out the US Fed’s aggressive tightening policy before we see the Bitcoin price reach a bottom. “Macroeconomic conditions need to improve and the Fed’s aggressive approach to monetary policy has to subside before crypto markets see a bottom,” they said.

The honest answer is that no one knows for sure.

Many industry insiders believe that the current bear market is simply a healthy correction after last year’s mania and that cryptocurrencies will continue to be adopted by businesses and consumers alike in the years ahead.

If you decide to buy into the crypto market now, remember to do your own research and always use caution when investing

? QUICK INVESTMENT ROUNDS

• Ghana’s fintech Fido raises $30 million to roll out new products and expand across Africa.

• German insurtech startup Wefox is seeking to raise several million dollars worth of funds to bring its valuation from $5 billion to $6 billion.

• French fintech Formance secures €2.9 million led by Hoxton Ventures, Frst, Y Combinator, and other business angels to help companies build and track payment flows.

?? REPORT OF THE DAY

The Future of Neobanking: How can Neobanks unlock profitable growth?

Few developments within financial services have happened with such breathtaking speed as the evolution of Neobanks. Less than 10 years after the first next-generation mobile banks entered the market, these digital disruptors developed into a global standalone industry segment.

There are now roughly 400 Neobanks around the world serving close to one billion clients. Unsurprisingly, this growth hasn’t gone unnoticed by investors, and now the industry is

worth around $300 billion. Read more about the future of Neobanks and how it can become profitable in this report.

? BEFORE YOU GO…

• Blockchain: HDFC Bank, ICICI Bank, and State Bank of India are among nearly a dozen top lenders the central bank is engaging with to run a blockchain-based pilot project centered on trade financing.

• NFTs: Binance is entering an exclusive multi-year NFT partnership with football legend Cristiano Ronaldo.

• Metaverse: Italian banking group Sella is introducing an accelerator program focused on helping startups who are working on finance solutions for the Metaverse.

?? THE LATEST ON COUCHONOMICS

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