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Cryptocurrency update: Visa introduces crypto trading, Elon Musk backs Bitcoin, and memes, memes, memes
In this week’s crypto update, Visa announces plans to integrate crypto into its network, meme traders send Dogecoin sky high before bringing it back down to Earth, and Elon Musk weighs in on the crypto debate.
Visa to add crypto trading to its network
According to comments made in its latest earnings call, Visa will soon add cryptocurrency trading to its network.
CEO Alfred Kelly has said Visa’s “global presence, its partnership approach as well as its trusted brand” makes it well placed to help make cryptocurrencies more safe.” Kelly also added how Visa’s move can make cryptos more applicable and useful for payments.
So, what will this look like in practice? Visa will split its crypto offering into two segments: cryptocurrencies and digital currencies.
When asked about assets held in the cryptocurrency segment, Kelly said they will be viewed “as digital gold.” According to Kelly, such currencies are “predominantly held as assets that are not used as a form of payment in a significant way at this point.”
Kelly said Visa will be working with wallets and exchanges to use their Visa credentials to acquire cryptocurrencies or to cash out onto a Visa credential to make a fiat purchase at payment points where Visa is accepted.
On the digital currencies front, Kelly said this segment would be made up of “fiat-backed digital currencies including stablecoins and central bank digital currencies.” Stablecoins are tokens whose value is tied to an asset like gold or fiat currency.
Musk backs Bitcoin, prices up, but effect doesn’t last long
Bitcoin’s been on another rollercoaster recently all thanks to the world’s richest man Elon Musk.
Last week, the Tesla CEO changed his Twitter profile to read simply “#bitcoin#”, following that up by tweeting “it was inevitable”. Ably showing the power of social media, or at least the influence of a tech-savvy billionaire, BTC soared, reaching over $38,000 for the first time since January’s major price spikes.
Cooler heads once again dropped the price back down to the $33,000 level. At the time of writing, BTC futures were trading at around $34,400.
Musk looks like he is strengthening his support for the most popular crypto on the market.
“I think bitcoin is really on the verge of getting broad acceptance by sort of the conventional finance people,” said Musk on Sunday 31st January during a Clubhouse chat session. “I don’t have a strong opinion on other cryptocurrencies.”
Will the Musk effect help Bitcoin in future? It probably depends on how many more pro-BTC statements Musk makes, but just from the price movements we’ve seen from a simple Twitter bio update, anything Elon Musk says related to the crypto could cause big upward movements.
Dogecoin: sending a meme to the moon?
With Redditors over on /r/Wallstreetbets deciding to take on the entire global trading system, their cryptocurrency trading cousins on the lesser known /r/Satoshistreetbets subreddit are doing their best to bump Dogecoin.
Dogecoin, originally started as a joke based on the Doge meme (basically a shiba inu dog with a funny face), is being pumped up by Reddit speculators. Its price action has gone wild in the past couple of days, soaring 420% on Friday January 29th, at one point gaining 1000%.
It’s essentially the product of an /r/Wallstreets copycat, backed by added meme power, itself a huge social currency on the internet. Even Elon Musk, who else, is getting on the act.
“The most entertaining/ironic outcome is the most likely, and the most entertaining outcome would be that $DOGE coin become the currency of the future,” Musk told Clubhouse.
Despite this, Dogecoin has now crashed as meme-based traders use it as a pump and dump and turn their attention to other tokens.
At the time of writing, XRP is surging, with investors pulling money out of doge and into Ripple’s crypto currency. Prices are up more than 100% in the last 48 hourson XRP, so maybe it’s not the power of memes dragging prices higher, more organised trading blocs pumping money into different cryptos.
XRP capitalisation is now around $28bn following the surge. That means it has now climbed back to the fourth most valuable cryptocurrency on the market today by market cap.
But, as we’ve seen from other historic and current spike-then-crash crypto cycles, nothing is certain in the world of cryptocurrencies. Volatility is an ever-present reality. Will XRP be trading as high this time next week? Will /r/Satoshistreetbets grow bored of sending XRP to the moon and look elsewhere? Anything can happen in the world of cryptos right now.