Crypto Weekly: Increased focus on crypto mining

Anders Nysteen

Senior Quantitative Analyst, Saxo Bank

Summary:  The crypto market is making a small comeback after volatile days last week. The crypto mining landscape could be facing significant changes, and ETF providers look into greener ETF proposals.


Crypto mining in focus

A large part of the global computation power for crypto mining comes from China, and crypto mining in China is popular due to the many hydroelectric power plants, as well as the fact that China is a big producer of mining rigs. With Chinas recent intention to crack down on bitcoin mining and trading activities, some miners are looking to move from China. According to CoinDesk, the crypto exchange Huobi has already scaled back or suspended some of its mining-related services in mainland China, and other miners such as BTC.TOP and HashCow are reviewing their operations in China. The Shenzhen-based company Bit Mining also announced that they are expanding to new facilities in Kazakhstan. Lastly, Iran announced a ban of crypto mining over the summer.

Ray Dalio interview

The founder of the large hedge fund Bridgewater Associates, Ray Dalio, stated during Coindesk’s Consensus event that he sees Bitcoin catching on as a store of value in an inflationary future, and that he would “…rather have bitcoin than a bond”. The interview fueled some positive sentiment in the crypto market after a volatile week last week with record-high drawdowns. Dalio does, however, raise concerns about whether governments will tolerate crypto currencies.

ETF proposals going green

A new filing for a Bitcoin ETF from One River Digital Asset Management to the U.S. Securities and Exchange Commission (SEC) intends to be carbon-neutral. According to their filing, they intend “… to offset the carbon footprint associated with bitcoin by purchasing and retiring carbon credits necessary to account for the estimated carbon emissions associated with the bitcoins held by the Trust”. The ETF proposal adds to the pool of existing filings under review by the SEC, although with a greener agenda.

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
- Full disclaimer (https://www.home.saxo/en-mena/legal/disclaimer/saxo-disclaimer)


Due to coronavirus controls, we are not able to meet with clients in our reception at present, unless by appointment in exceptional circumstances. We remain at your service on the phone and email details below. Thank you for your understanding.

Please expect very long waiting times on the line when calling us, we advise you to send us an email instead.

Contact Saxo

Select region

UAE
UAE

Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.