Welcome to the weekly round-up of blockchain developments and crypto activities.

Crypto bull or bear market?

With the fall in prices of crypto currencies last week, investors are again raising the question whether the crypto market is in a bubble. In the past seven days, crypto currency prices have tumbled with bitcoin dipping to US$50,300 on April 25, down from US$56,850 on April 19. Given that bitcoin has about half of the crypto market, investors are closely watching its price, using it as a bellwether of crypto health.

According to CNBC, the April 14 successful listing of Coinbase boosted the crypto market. Bitcoin at some point in the last three weeks reached a high of US$64,000. Then came President Biden’s decision last week to increase capital gains tax which prompted a big sell-off of bitcoin. Bitcoin’s share price has fallen almost 16 per cent from its peak on April 16.

The sharp sell-off in bitcoin is troubling for investors. Yet others have learnt to live with the volatility of bitcoin. They are seizing the opportunity to buy in the dip. Yahoo Finance quoting Stack Funds, a Singapore-based digital asset investment firm that “the fundamental narrative for bitcoin to the upside has not changed.” The report cites WeWork’s acceptance of crypto as a form of payment and Venmo facilitating crypto transactions on its platform show increasing adoption of bitcoin by businesses and mainstream users.

The media has carried many articles on the crypto bubble. It’s difficult to find who to believe: the celebrity memes or the experts who crunch the numbers and follow the market. A conundrum even for the best analysts.

Banking, manufacturing to lead global blockchain growth

Global spending on blockchain solutions by organisations are forecast to hit nearly US$6.6 billion, an increase of more than 50% compared to 2020. Research firm IDC forecast strong growth between 2020 and 2024 with a five-year compound annual growth rate (CAGR) of 48%.

The pandemic has accelerated investment in technology by organisations across all markets and industries, said James Wester, IDC’s blockchain research director. It highlighted “the need for more resilient, more transparent supply chains, healthcare delivery, financial services, and so much more, and enterprises around the world have been investing in blockchain to provide that resiliency and transparency,” he said in IDC’s new report on Worldwide Blockchain Spending Guide.

Covid-19 has made it clearer than ever that in order to have resilient business operations, changes in behaviour, demand, and supply have forced companies to adopt a digital-led and blockchain-driven business model to survive lockdowns, supply disruptions, and future crises.

IDC research manager Stacey Soohoo points out that “specifically focus has been in tracking items from manufacturer to distribution to the end consumer and related payments and settlements that come with goods movements and management”.

The market has reached a point where successful pilots and deployments have proven the need, but challenges remain especially a willingness to collaborate to instill blockchain technology across the entire value chain, with every single participant needing and wanting to be a part of the network, she says

Leading the application for blockchain is blockcross-border payments & settlements, which uses distributed ledger technology to track, trace, and manage payments and settlements. The second largest blockchain use case is lot lineage/provenance, which is used to verify the origin and authenticity of a product as it moves throughout the value chain. Other applicaitons include trade finance & post trade/transaction settlements, asset/goods management, and identity management.

What I am reading this week:

Mark Mobius: Yep we’re in bubble, especially in crypto


Why warnings of a dangerous bitcoin bubble are misleading


Bitcoin suffers biggest weekly loss since March 2020


STACS raises S$4.8 million ahead of series A funding round


Norwegian tax authorities want investors to voluntarily declare their crypto earnings


Grace is Singapore-based seasoned tech writer. Excited about the blockchain and crypto which is creating a new Internet of value.