Purchases of Bitcoin by central banks and sovereign funds are inevitable as the adoption of cryptocurrencies continues to grow, according to Gemini co-founder Tyler Winklevoss.
More companies are also likely to hold Bitcoin on their balance sheet for treasury purposes, as it serves as a better hedge against inflation than gold, Mr Winklevoss, a cryptocurrencies afficionado, told a webinar organised last week by the AIM Summit and digital asset manager 3iQ.
"At some point a central bank will have Bitcoin on its balance sheet. That just will happen," Mr Winklevoss said.
"Because central banks have gold on their balance sheet. And Bitcoin is Gold 2.0," he argued.
Mr Winklevoss and his twin brother Cameron rose to fame in 2004 after suing Facebook founder Mark Zuckerberg, whom they had employed to build a social networking site, HarvardConnection. The pair alleged that he stole their idea to create Facebook and the case was settled in 2008, with the twins reportedly receiving $65 million in cash and Facebook shares. They invested this in Bitcoin and now have a net worth of $3 billion each, according to Forbes.
The Winklevoss twins first invested in Bitcoin through the Mt Gox exchange in Japan in 2012. Mt Gox was once the world's largest Bitcoin exchange handling 70 per cent of all transactions but it crashed in 2014 after hackers stole about 850,000 Bitcoin (worth $49.2bn at today's prices) from the site's customers.
Their loss spurred them into setting up Gemini, a company that offers cryptocurrency custody and exchange services that is regulated by the New York State Department of Financial Services.
Mr Winklevoss said they wanted to build an "institutional-grade" exchange that could be used by the world's biggest money managers. However, thus far only a handful of large asset managers have offered Bitcoin-related investments to clients.
Gemini has held discussions with sovereign funds, pension funds and endowment managers about investing in Bitcoin, according to Mr Winklevoss.
"You'd be shocked how sophisticated and knowledgeable they are in the asset class," he said.
"In my opinion, it is not an if, it is a when that a sovereign wealth fund comes out and says they have Bitcoin. They may already have it."
He expects more companies to hold Bitcoin on their balance sheet as a tool to move money between jurisdictions and a hedge against devaluing currencies, citing the well-documented examples of Tesla and Square.
"There's about 40,000 publicly-traded companies around the world on global stock exchanges that are regulated. I think only 32 have Bitcoin on their balance sheet. That number is going to increase over time. You're going to see the Fortune 100, 500, 1,000 – they're all going to have Bitcoin," Mr Winklevoss said.
The huge monetary stimulus undertaken by the US Federal Reserve and other central banks around the world is also convincing people who were sceptical about cryptocurrency in the past to embrace it, he argued. The US federal debt-to-GDP ratio hit 135 per cent in the second quarter of last year at the peak of the pandemic, which was "higher than in World War II".
"There's actually a big difference, though, because back then we had full employment and record production for the war effort. This time around ... we have had record unemployment and the world's production [ground] to a halt.
"It doesn't take a rocket scientist to see what's happening in these fiat government currency regimes."
Bitcoin rose to $57,551.41 at 6.33pm UAE time on the Luxembourg-based Bitstamp exchange on Saturday. It had risen above $63,000 earlier this month, but faced a sell-off after US President Joe Biden announced plans to increase capital gains taxes. It has still increased six-fold in value over the past 12 months, with a market cap of $1.08 trillion
Regulators in many countries have expressed concerns, though, with Turkey's government introducing a ban on using cryptocurrencies for payment. India's government is also reported to be weighing up a ban and regulators in other markets have expressed concern about Bitcoin's role in money laundering and other illicit activity.
However, 3iQ and other asset managers have developed exchange-traded funds and other regulated vehicles through which asset managers can offer their clients exposure to Bitcoin.
Earlier this month the Canadian digital asset manager said it will seek a listing on Nasdaq Dubai for The Bitcoin Fund, which has a net asset value of $1.33bn. The company is targeting around $200m of subscriptions from investors through the Dubai listing.
"We are seeing a lot of banks trying to get access to crypto for their customers. I think a lot of their customers feel left out," Mr Winklevoss said.
"They've seen Bitcoin is the best-performing asset of the last decade, it's on track to be the best-performing asset of this decade – I think Ether is neck and neck with it. But these assets have absolutely blown away the equities market, the FAANG companies – the best of the best." FAANG is an acronym referring to the stocks of Facebook, Amazon, Apple, Netflix and Alphabet (formerly known as Google)
3iQ's chairman and chief executive Frederick Pye said that although "the world is waiting" for pension funds and other institutions to declare their Bitcoin positions, but they are unlikely to do so.
"Some of the biggest pension funds we are talking to would come back and make us absolutely swear to secrecy if we were managing a portfolio for them because they still consider there's a tail risk in terms of if something dramatic [happens]. Bitcoin has had three corrections of 90 per cent. Nobody wants to hear that their provincial pension plan, federal pension plan or company pension plan has an asset that's down 90 per cent," he said.
Various Artists
Habibi Funk: An Eclectic Selection Of Music From The Arab World (Habibi Funk)
Company%20profile
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A new relationship with the old country
Treaty of Friendship between the United Kingdom of Great Britain and Northern Ireland and the United Arab Emirates
The United kingdom of Great Britain and Northern Ireland and the United Arab Emirates; Considering that the United Arab Emirates has assumed full responsibility as a sovereign and independent State; Determined that the long-standing and traditional relations of close friendship and cooperation between their peoples shall continue; Desiring to give expression to this intention in the form of a Treaty Friendship; Have agreed as follows:
ARTICLE 1 The relations between the United Kingdom of Great Britain and Northern Ireland and the United Arab Emirates shall be governed by a spirit of close friendship. In recognition of this, the Contracting Parties, conscious of their common interest in the peace and stability of the region, shall: (a) consult together on matters of mutual concern in time of need; (b) settle all their disputes by peaceful means in conformity with the provisions of the Charter of the United Nations.
ARTICLE 2 The Contracting Parties shall encourage education, scientific and cultural cooperation between the two States in accordance with arrangements to be agreed. Such arrangements shall cover among other things: (a) the promotion of mutual understanding of their respective cultures, civilisations and languages, the promotion of contacts among professional bodies, universities and cultural institutions; (c) the encouragement of technical, scientific and cultural exchanges.
ARTICLE 3 The Contracting Parties shall maintain the close relationship already existing between them in the field of trade and commerce. Representatives of the Contracting Parties shall meet from time to time to consider means by which such relations can be further developed and strengthened, including the possibility of concluding treaties or agreements on matters of mutual concern.
ARTICLE 4 This Treaty shall enter into force on today’s date and shall remain in force for a period of ten years. Unless twelve months before the expiry of the said period of ten years either Contracting Party shall have given notice to the other of its intention to terminate the Treaty, this Treaty shall remain in force thereafter until the expiry of twelve months from the date on which notice of such intention is given.
IN WITNESS WHEREOF the undersigned have signed this Treaty.
DONE in duplicate at Dubai the second day of December 1971AD, corresponding to the fifteenth day of Shawwal 1391H, in the English and Arabic languages, both texts being equally authoritative.
Signed
Geoffrey Arthur Sheikh Zayed
if you go
The flights
Flydubai flies to Podgorica or nearby Tivat via Sarajevo from Dh2,155 return including taxes. Turkish Airlines flies from Abu Dhabi and Dubai to Podgorica via Istanbul; alternatively, fly with Flydubai from Dubai to Belgrade and take a short flight with Montenegro Air to Podgorica. Etihad flies from Abu Dhabi to Podgorica via Belgrade. Flights cost from about Dh3,000 return including taxes. There are buses from Podgorica to Plav.
The tour
While you can apply for a permit for the route yourself, it’s best to travel with an agency that will arrange it for you. These include Zbulo in Albania (www.zbulo.org) or Zalaz in Montenegro (www.zalaz.me).
UAE currency: the story behind the money in your pockets
The specs: 2018 Renault Megane
Price, base / as tested Dh52,900 / Dh59,200
Engine 1.6L in-line four-cylinder
Transmission Continuously variable transmission
Power 115hp @ 5,500rpm
Torque 156Nm @ 4,000rpm
Fuel economy, combined 6.6L / 100km
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
Scoreline
Al Wasl 1 (Caio Canedo 90 1')
Al Ain 2 (Ismail Ahmed 3', Marcus Berg 50')
Red cards: Ismail Ahmed (Al Ain) 77'
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
The specs: 2018 Honda City
Price, base: From Dh57,000
Engine: 1.5L, in-line four-cylinder
Transmission: Continuously variable transmission
Power: 118hp @ 6,600rpm
Torque: 146Nm @ 4,600rpm
Fuel economy, combined: 5.8L / 100km
The%20Genius%20of%20Their%20Age
%3Cp%3EAuthor%3A%20S%20Frederick%20Starr%3Cbr%3EPublisher%3A%20Oxford%20University%20Press%3Cbr%3EPages%3A%20290%3Cbr%3EAvailable%3A%20January%2024%3C%2Fp%3E%0A
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
The Indoor Cricket World Cup
When: September 16-23
Where: Insportz, Dubai
Indoor cricket World Cup:
Insportz, Dubai, September 16-23
UAE fixtures:
Men
Saturday, September 16 – 1.45pm, v New Zealand
Sunday, September 17 – 10.30am, v Australia; 3.45pm, v South Africa
Monday, September 18 – 2pm, v England; 7.15pm, v India
Tuesday, September 19 – 12.15pm, v Singapore; 5.30pm, v Sri Lanka
Thursday, September 21 – 2pm v Malaysia
Friday, September 22 – 3.30pm, semi-final
Saturday, September 23 – 3pm, grand final
Women
Saturday, September 16 – 5.15pm, v Australia
Sunday, September 17 – 2pm, v South Africa; 7.15pm, v New Zealand
Monday, September 18 – 5.30pm, v England
Tuesday, September 19 – 10.30am, v New Zealand; 3.45pm, v South Africa
Thursday, September 21 – 12.15pm, v Australia
Friday, September 22 – 1.30pm, semi-final
Saturday, September 23 – 1pm, grand final
The specs
Price, base / as tested Dh960,000
Engine 3.9L twin-turbo V8
Transmission Seven-speed dual-clutch automatic
Power 661hp @8,000rpm
Torque 760Nm @ 3,000rpm
Fuel economy, combined 11.4L / 100k
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