This week bitcoin became the official currency for El Salvador making it the first country to do so. The country, having USD as its official currency switched to bitcoin with the potential opportunity to attract new investors into the country When the governments in the world are pushing hard to restrict bitcoin adoption, Salvador plans to capitalize on this opportunity.
But it’s surprising to believe, that bitcoin experienced a heavy dip on adoption day; with prices falling up to ~15%.
Though few believe that is due to the lumpy launch of Chiva(official bitcoin app for El Salvador), few believe the dip is a part of a strategic move against the bitcoin progression. Whatever it would be, we believe this is the start of something new something independent.
On the interesting side, please read the series of tweets expressing a broader picture –
Whats building in Tech –
Facebook has finally talked about its most awaited digital wallet program called Novi. Though Novi is necessary for facebook’s long-term projects of wearables and augmented reality, Washington’s role in this program would be crucial.
The developing power of Facebook has been challenged multiple times by the antitrust commission in recent years. Introducing digital payments give facebook access to another industry and poses a potential market disruption.
It would be interesting to see how Washington would react to this!
Other updates in the tech –
Global Market Update –
Global Equity Market –
Owing to weaker than expected job reports, S&P 500 experienced the week in red – Delta variant is expected to be the key driver of this dip.
What’s building in the commodity market? –
Beijing is taking steps to rein in inflationary pressures stemming from commodity markets by selling oil from its state petroleum reserves for the first time. As part of an effort to alleviate the pressure of rising raw material prices, the State Bureau of Grain and Material Reserves said Thursday it would release batches of oil for sale to domestic refining and chemicals companies. “Sale of national reserve crude oil in open auctions will stabilize domestic market supply and demand and ensure national energy security,” it said.
Unlike other large oil importers such as the US, China has never before publicly announced its intentions to draw on its reserves to meet budgetary needs or during supply disruptions.
Though this move is expected to stabilize the Chinese oil market, it would be interesting to see how OPEC+ and other countries react to such a move.
Companies In Focus –
- The 737 MAX’s biggest customer outside of the United States is walking away from talks for a new order. Analysts had been watching Ryanair’s decision as an indicator of Boeing’s recovery from the 737 MAX’s crisis.
- In response to chip shortages, eight of GM’s North American assembly plants have halted or are continuing to halt production.
- In its first round of funding, Delhivery raised $76.4 million from Addition
- Seed funding of $11 million was raised by Indian e-commerce company Dukaan. Cambridge Angels led the round and were joined by Oxford Venture Partners, Old Well Ventures, Lets Venture, 9Unicorns, and Lightspeed Venture Partners and Leopard Ventures.
- One of BlackRock’s mutual funds for individual investors in China raised $1 billion. For the first time, a foreign company runs a mutual fund in China
- Doug Field is now employed by Ford. He helped Tesla develop the Model 3 and led Apple’s efforts to develop a car. Ford has recently planned to close India operations and looks like it is going through a massive restructuring.
Thanks for Reading!
Shubham Agarwal (CFA L2 Candidate | Incoming MBA candidate at University of Cambridge, UK)