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Another domino is lined up to fall down the route to Bitcoinization. On Wednesday, the Pacific island nation of Tonga shared a play-by-play approach to adopting Bitcoin (BTC) as legal tender.
In a series of tweets, Lord Fusitu’a, a former member of parliament for Tonga, released an ETA for Bitcoin becoming legal tender in Tonga. Copying El Salvador’s playbook, the move could onboard more than 100,000 Tongans onto the Bitcoin network.
In his five-point plan, the chairman of the Global Organization of Parliamentarians Against Corruption describes the adoption path:
1. Sept/Oct Bill goes to Parliament. Passed.
2. Sent to Palace Office for submission to His Majesty for Royal Assent.
3.<A month – HM as advised by Privy Council assents to Bill.
4. 2-3 Weeks Gazetted by Govt activation date set.
4. On activation date #BTC becomes legal tender. https://t.co/TNjQjeEbjN
— Lord Fusitu’a (@LordFusitua) January 12, 2022
In a follow-up comment, Fusitu’a said the bill is “modeled on and is almost identical to the El Salvador bill.”
The announcement sowed the seeds for questions, predictions and outright jubilation from Bitcoin Twitter before the Tongan set the record straight. He enthusiastically replied that the timeline for BTC becoming legal tender could happen as early as November or December this year, replying, “Boom! That’s us, brother!” in a tweet.
In 2021, it was widely speculated that Tonga would become one of the next countries to adopt BTC as legal tender. Speculation reached a fever peak following a podcast Lord Fusitu’a undertook with Bedford-based Bitcoiner Peter McCormack.
During the conversation, the then-member of parliament shared the remittance case for adopting BTC as legal tender. He said adoption would provoke:
“A disposable income increase by 30%. With that extra 30%, some (people) are going to be saving it rather than putting it into the economy and stacking sats.”
Tonga is a remote island nation that relies upon remittances from countries, including Australia, New Zealand and the United States. The International Finance Corporation estimates that Tonga receives more income from remittances than any other country in the world, contributing up to 30% of household income.
Furthermore, while the Tongan population numbers just six figures, the Tongan diaspora is vast. The International Organization for Migration estimates the Tongan population living abroad at 126,000, with up to 18,000 Tongans in Australia.
The remittance use case was one of the primary drivers for El Salvador adopting BTC as legal tender. According to the World Bank, Tonga’s remittance as a percentage of gross domestic product is substantially higher than El Salvador, at 39% vs. 24%, respectively.
Remittance aside, the Lord brought up domestic advantages for adopting the open-source protocol. He agreed that Tonga could create a BTC circular economy and that it’s “one of the few instances in which being a sparsely populated small island kingdom archipelago is an advantage.”
When the islands’ internet infrastructure was brought into question, the Tongan claimed internet and smartphone penetration rates exceeded 90%. The World Bank’s most recent figures — albeit from five years ago in 2017 — show Tonga at 50% internet penetration.
Bringing the islands online may take some time, but Fusitu’a is adamant about his country’s BTC future:
An economy that uses bitcoin for payment at every stage of the supply chain. From the seed to the table. Pay for cassava roots and cattle in bitcoin from the farming supplier all the way to the waitress serving it to you at Kardo’s steak bar and every step in between in #BTC https://t.co/oR48NGzTGm
— Lord Fusitu’a (@LordFusitua) January 13, 2022
Canadian businessman Kevin O’Leary laid out his plans to invest in mining company stocks. In an interview with Anthony Pompliano, Mr. Wonderful shared stories about his recent travels in the Middle East to find ways to invest in Bitcoin (BTC) mining. According to the Shark Tank mogul, investors in the Middle East are looking into “sovereign mining operations.”
O’Leary also predicts that in the next 2-3 years, sovereign funds may decide to invest in Bitcoin mining. However, the businessman notes that the funds will choose mining businesses that use sustainable energy. Due to environment-related controversies, the eco-friendliness of mining operations is a crucial deciding factor for investors, according to the Canadian entrepreneur.
The businessman also expressed his interest in opening his own mining operations. However, he explained that there are things that he is considering before this happens. He stated that aside from government approvals, the people who live in the community where the mining operations will take place must approve of the business.
Aside from these, the entrepreneur also explained that Bitcoin mining companies must be able to track their BTC earnings in company balance sheets. This enables investors to buy the mining company stock and own BTC through equity. O’Leary notes that he will be investing in BTC through this process.
Back in December, O’Leary also shared his thoughts on crypto investing with the public. In an exclusive interview with Cointelegraph, the businessman explained that investing in crypto is similar to investing in Google and Microsoft.
“If you’re investing in, for example, Google or Microsoft, what are you investing in? You’re investing in software. Why wouldn’t you invest in crypto? It’s software too,” he said.
Meanwhile, the former BTC critic is also very excited about the potential of nonfungible tokens (NFT). O’Leary is betting that NFTs may potentially become bigger than Bitcoin. However, he notes that he will invest in both.
Bitcoin’s (BTC) sudden crash on Jan. 10 caused the price to trade below $40,000 for the first time in 110 days and this was a wake-up call to leveraged traders. $1.9 billion worth of long (buy) futures contracts were liquidated that week, causing the morale among traders to plunge.
The crypto “Fear & Greed” index, which ranges from 0 “extreme fear” to 100 “greed” reached 10 on Jan. 10, the lowest level it has been since the Mar. 2020 crash. The indicator measures traders’ sentiment using historical volatility, market momentum, volume, Bitcoin dominance and social media.
As usual, the panic turned out to be a buying opportunity because the total crypto market capitalization rose by 13.5%, going from a $1.85 trillion bottom to $2.1 trillion in less than three days.
Currently, investors seem to be digesting this week’s economic data that shows United States December 2021 retail sales going down by 1.9% compared to the previous month.
Investors have reason to worry about stagflation, a scenario where inflation accelerates despite the lack of economic growth. However, even if this eventually proves that Bitcoin’s digital scarcity is a positive characteristic, markets will still take shelter with whatever asset is deemed safe. Thus, the first wave will potentially be damaging for cryptocurrencies.
Bitcoin price was flat over the past seven days, effectively underperforming the altcoin market’s 7% gain. Part of this unusual movement can be explained by layer-1 decentralized applications platforms showing a positive performance that was driven by Fantom (FTM), Cardano (ADA), Near Protocol (NEAR) and Harmony (ONE).
Loopring (LRC), a zkRollup open protocol for decentralized exchanges on Ethereum, presented the worst performance of the week. The DEX volume using the protocol peaked at $30 million per day in early December 2021, but is now near $6 million. Meanwhile, Dfinity (ICP) and Chainlink (LINK) are adjusting after a 40% or higher rally in the first 10 days of 2022.
The OKEx Tether (USDT) premium or discount measures the difference between China-based peer-to-peer (P2P) trades and the official U.S. dollar. Figures above 100% indicate excessive demand for cryptocurrency investing. On the other hand, a 5% discount usually indicates heavy selling activity.
The Tether indicator bottomed at a 3% discount on Dec. 31, which is slightly bearish but not alarming. However, this metric has held a decent 2% discount over the past week, signaling no panic selling from China-based traders.
To further prove that the crypto market structure has held, traders should analyze the CME’s Bitcoin futures contracts premium. That metric analyzes the difference between longer-term futures contracts to the current spot price in regular markets.
Whenever this indicator fades or turns negative, it is an alarming red flag. This situation is also known as backwardation and indicates that bearish sentiment is present.
These fixed-month contracts usually trade at a slight premium, indicating that sellers request more money to withhold settlements for longer. As a result, futures should trade at a 0.5% to 2% premium in healthy markets, a situation known as contango.
Notice how the indicator flipped negative on Dec. 9 as Bitcoin traded below $49,000 but it still managed to sustain a slightly positive number. This shows that institutional traders display a lack of confidence, although it is not yet a bearish structure.
Considering that the aggregate cryptocurrency market capitalization is down 9.5% to date, the market structure held rather nicely. The CME futures premium would have gone negative if there had been excessive demand for short-sellers.
Unless these fundamentals change significantly, there is not yet sufficient information available that would support calls for a sub-$40,000 Bitcoin price.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
It wasn’t just a bull run for prices last year. Careers in crypto outstripped price action in 2021, as crypto job searches soared by 395% in the United States alone according to LinkedIn.
Crucially, the crypto industry outpaced the wider tech industry, which also saw remarkable development, almost doubling its number of job listings. However, at 98% growth, the tech industry dwindles in comparison to crypto jobs, which gained by a whopping 395%.
Furthermore, no industry was safe from “crypto-ization” in 2021. The LinkedIn News post offered valuable insight into crypto influencing other industries:
While most of the job postings were in software and finance, other industries are also seeing a rise in demand for crypto talent. These include professional services like accounting and consulting, as well as the staffing and computer hardware sectors.
For 2022, the growth trend looks set to continue. The biggest exchanges in crypto are brimming with job posts; Coinbase has over 250 openings, Kraken over 300, and the world’s most active exchange, Binance, lists more than 600 job posts.
For Bitcoiners and Bitcoin (BTC) Maxi’s there’s a new resource, Bitcoiner jobs. A service dedicated to helping connect Bitcoiners with Bitcoin-only companies, it now offers almost 100 Satoshi-approved careers.
For those who are unable to switch jobs into crypto, a wider HR trend is crypto remuneration. The Mayors of New York and Miami announced that they would take a portion of their pay in BTC in 2021, while a total of seven NFL players have chosen crypto over cash salaries to date.
Nonetheless, while the crypto career switch appears to be gaining traction, the LinkedIn audience is not convinced. Most comments on the LinkedIn post were from bewildered onlookers wondering why crypto has value; and one aggrieved copywriter remonstrated the industry’s scammy nature.
Plus, given that Bitcoin price action has yet to impress in 2022, the crypto industry may struggle to sustain such high human resources growth levels.
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