Bitcoin price plunges; Metaverse actions heats up in China

Transcript

Welcome to The Daily Forkast, September 8th, 2021. I’m Angie Lau, Editor-in-Chief of Forkast.News, covering all things blockchain.

Well, how things have changed within 24 hours. Just one day ago, the outlook for crypto markets was looking good. But shortly after El Salvador became the first country to accept bitcoin as legal tender, it took a dive and that rattled the wider crypto market, that’s continuing into Asia trading hours.

We’re going to talk about that and a whole lot more coming up. Let’s get you up to speed from Asia to the world.

First up, not only did Bitcoin plunge, but it took other cryptocurrencies down with it.

A pullback across the board saw all the major tokens suffering losses of 10% to 15% within the 24 hours to Wednesday morning Asia time.

Solana was the one exception. It traded up 1.5% over the same time period.

So was the pullback in reaction to El Salvador’s adoption of bitcoin? Or is something else going on?

Forkast.News Lachlan Keller has more.

Bitcoin’s price crashed through the US$50,000 mark, hitting a low of a little over US$43,000 Tuesday night Asia time.

But the fall followed run-ups across the board over the last month. One expert told Forkast.News that investors shouldn’t be overly concerned about the move.

“I certainly would want people to feel as though the price movement of Bitcoin is a reflection on the long-term success or otherwise of Bitcoin in El Salvador.”

Jonathon Miller of Kraken Digital Asset Exchange agrees that such moves are to be expected as part of the natural cycle, with markets becoming volatile when they’re close to all-time highs.

He says Solana likely bucked the market trend due to the explosion of interest in NFTs, as is proving to be a meaningful alternative to Ethereum because it’s faster and cheaper.

Looking long term. He’s excited about wider developments in the altcoin world.

“I think the reality is that we’ll see lots of interoperability in the future, and you’re already starting to see cross-chain stuff happening and layer-2 networks interoperating as well. So this is the start of a longer-term story.”

Miller says that as the altcoin world hones in on specific use cases, there’s plenty of potential for growth ahead.

For Forkast.News, I’m Lachlan Keller.

Meanwhile, tighter crypto regulation could be in the cards in Hong Kong.

That’s if the Securities and Futures Commission get their way. An official from the regulator says a crackdown on unlicensed cryptocurrency transactions is needed to protect investors. If tighter supervision is introduced, real question is what could that mean for investors and how might that play out in the broader international regulatory space?

Forkast.News Timmy Shen reports.

According to local media outlet ETNet, Deputy Chief Executive Officer Julia Leung spoke at an event on Tuesday, saying that Hong Kong is looking to further regulate virtual assets as scams related to them have been on the rise. That could see relevant licensing regulations expanded to supervise virtual assets.

A former regulator who wrote laws covering crypto told Forkast.News that many scams happen as there’s a lack of understanding around digital assets and that while regulations are needed to provide a safe and fair market for all, investor education is also vital.

“If you don’t understand it, if it doesn’t sound right, if it sounds too good to be true, it normally is and is a scam, so don’t get into it.”

Hong Kong has already proposed legislation requiring virtual asset service providers or VASPs obtain licenses to operate. And in May, the government published conclusions from a consultation on the licensing regime for VASPs.

Once that regime comes into effect, licensed VASPs will be subject to relevant anti-money laundering requirements, and the SFC will be able to supervise them with broader powers.

But it is still possible that further changes could be made in the drafting of the legislation before it is passed.

For Forkast.News, I’m Timmy Shen.

And finally, today the metaverse is heating up in China.

Game developer Shenzhen Zhong Qing Bao Interactive Network’s stock price soared by the daily limit on both Tuesday and Wednesday after it announced it was developing a VR-based Metaverse universe game.

Despite the fact that the game is still under development and no release date has been announced as yet, we actually saw share prices leaping to the maximum 20% allowed on both days.

The game, named “Brew Master”, will allow players to act as winemakers and build their own liquor factory. The wines they create within the game can then be made into NFTs for trading and auction.

And, even more interestingly, players can also get their virtual recipes made into actual drinks produced by real-world liquor factories.

And that’s not the only development in the industry.

Last Monday, according to the local financial media outlet Yangtze River Commercial Daily, TikTok owner ByteDance paid US$ 1.93 billion to acquire China’s biggest VR glasses manufacturer, Pico.

With deals like that seems like there’s a lot of confidence in potential for growth within the metaverse world in China and beyond.

We’ll drink to that.

And that’s The Daily Forkast from our vantage point right here in Asia. For more visit Forkast.News. I’m Editor-in-Chief Angie Lau. Until the next time.