Wall Street Issues Serious $6.6 Trillion Crypto Warning As Price Crash Fears Hit Bitcoin, Ethereum And XRP
Sign up now for CryptoCodex—A free newsletter for the crypto-curious
The bitcoin price has plunged from an all-time high of $124,000 per bitcoin just last week, dropping around 10% to $114,000, while ethereum and Ripple's XRP have seen similar declines despite U.S. president Donald Trump dropping a surprise $12.2 trillion crypto bombshell.
Bitcoin and crypto's decline, coming just as JPMorgan makes a game-changing Federal Reserve flip, follows Wall Street giants issuing a warning that the recently passed Genius Act stablecoin bill could trigger a $6.6 trillion flood of account withdrawals.
Sign up now for the free CryptoCodex—A daily five-minute newsletter for traders, investors and the crypto-curious that will get you up to date and keep you ahead of the bitcoin and crypto market bull run
U.S. banking groups that count Wall Street giants such as JPMorgan and Bank of America as members have urged Congress to close a loophole in the recently passed Genius Act stablecoin bill that allows issuers of the dollar-pegged cryptocurrencies to offer yields via affiliates, warning it could trigger huge account deposit flight that would undermine the banking system.
In April, a Treasury Department report estimated that stablecoins could trigger up to $6.6 trillion in deposit outflows, depending on whether they can offer interest or yield, with the stablecoin market expected to grow to $2 trillion by 2028, up from $280 billion today.
"Congress must protect the flow of credit to American businesses and families and the stability of the most important financial market by closing the stablecoin payment of interest loophole," the report, posted to the Bank Policy Institute website, and addressed to lawmakers, read.
'Banks power the economy by turning deposits into loans. Incentivizing a shift from bank deposits and money market funds to stablecoins would end up increasing lending costs and reducing loans to businesses and consumer households.'
The plea to lawmakers was also signed by the American Bankers Association, Consumer Bankers Association, Independent Community Bankers of America and the Financial Services Forum.
Stablecoin adoption wars are heating up following the passage of the Genius Act that laid down rules of the road for the crypto-based dollars.
Tether's USDT remains the dominant stablecoin but is facing a tidal wave of competition from all angles, including Wall Street giants themselves, technology companies such as Facebook's Meta, as well as financial technology companies like PayPal and Stripe.
Earlier this year, David Sacks, a technology investor and U.S. president Donald Trump's crypto czar, said on the All In Podcast he hosts with three other investors that he hopes that eventually the rules will swing in favor of stablecoin issuers, allowing them to directly offer interest to stablecoin holders.
Trump's sons Eric and Don Jr have publicly said their World Liberty Financial crypto project is a direct challenge to Wall Street following their claims of being 'de-banked' in the aftermath of Trump's 2020 election loss. 'Honestly, I would love to see some of the big banks go extinct, because, honestly, they deserve it," Eric Trump said in May.
Sign up now for CryptoCodex—A free newsletter for the crypto-curious
The bitcoin price and crypto market's latest downturn, coming as just as traders celebrated a fresh all-time high, have raised fears the market could see further declines in coming weeks.
'The crypto market continued its decline on Monday after a pause over the weekend,' Alex Kuptsikevich, FxPro's chief market analyst, said in emailed comments.
'The total capitalisation fell back to $3.88 trillion, reaching its lowest level in more than two weeks. As expected, altcoins are falling the hardest, with ethereum and XRP losing about 5% in the last 24 hours, twice as much as bitcoin. Bitcoin fell to $115,000, the lowest level in the last 11 days. It is now testing the 50-day moving average, which has been the bullish trend line since April. A consolidation below it will sharply increase the chances of a deeper correction, and a failure below $112,000—the area of recent lows—will confirm the correction, opening the potential for a decline to $105,000-107,000.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Hill
a minute ago
- The Hill
Trump's trade ‘deals' are economically self-defeating and a geopolitical failure
To President Trump's supporters, the one-sided trade 'deals' negotiated with the United Kingdom, Japan and most recently the European Union may seem like victories. They may seem like a vindication of the president's supposed street-savvy negotiating style. In reality, they are self-defeating in their economics and harmful to America's alliances. Under the trade arrangement concluded at the end of July, the EU will scrap tariffs on U.S. imports and commit to large-scale purchases on American energy and defense systems, as well further U.S. investment. In exchange, the EU gets a U.S. tariff of 15 percent, vastly exceeding average tariff rates across the industrialized world in the post-war era. At the risk of stating the obvious, the three 'deals' are not trade agreements in any meaningful sense. They lack the legal weight that foreign trade agreements carry. Nor do they entail a liberalization of trade — rather, they ratify America's imposition of new tariff barriers against some of its closest allies, while also extracting concessions from these nations under threat of even higher tariffs. Because tariffs are effectively taxes on Americans, the U.S. economy and consumers are the first and foremost losers of these new 'deals,' especially in sectors where imports from the three partner economies serve as inputs into U.S. economic activity. The BMW plant in Spartanburg, S.C., to cite just one example, uses a lot of EU-made components; barring special, yet-unannounced carve-outs, its production has just become less competitive. Jobs will be lost, just as they were lost in the aftermath of Trump's first-term steel and aluminum tariffs across industries that rely on those metals. The geopolitical ramifications are even more pernicious. 'It's about security, it's about Ukraine,' the EU Trade Commissioner Maros Sefcovic said to justify the European concessions back in July, not anticipating that the deal would have little impact on the administration's planned rapprochement with Russia, on full display in Alaska on Friday. American alliances since 1945 have been sustained by a perception of the U.S. as a fundamentally different kind of global superpower, one that was neither predatory nor seeking domination for its own sake. While Russia and China may have had control over their clients or over nations that they subjugated by brute force, the U.S. had real friends — at least until now. Europeans, the Japanese, or the Koreans have generally hoped for our leadership, comfortable in the knowledge that our decisions will be informed, at the very least, by a basic sense of decency. That sense is being shaken to the core. Trump is transforming a rules-based, voluntary system of international cooperation, imperfect as it was, into a system of quasi-colonial extortion. The MAGA camp might derive a sense of satisfaction from humiliating 'free-riding' U.S. allies, but the resulting arrangements are not sustainable. Canada and Mexico have learned that even a proper free trade agreement negotiated with a Trump administration and ratified by Congress offers little protection against new arbitrary tariffs. It will soon dawn on voters in Japan, the U.K. and the EU — if it hasn't already — that their country's trade deals are both hopelessly unbalanced and subject to change by Washington at a moment's notice. Even if the deals hold in the short term, they are bound the produce a political backlash, which will make the prospect of working together with the U.S. on matters of mutual interest far less likely. There was a reason why the Japanese government postponed the announcement of its trade deal with the U.S. until after its recent upper house parliamentary election, from which it has emerged badly bruised. Similarly, the European Commission will have a hard time selling its deal with Trump to member states — whose cooperation is essential if the promises of hundreds of billions in U.S.-bound investment and purchases of American goods are ever going to materialize. For decades, there have been voices in European politics decrying America's real or imaginary domination of the old continent. Today, they have a real, tangible grievance they can hold on to: The EU is essentially promising a large transfers of wealth to the U.S., in the form of future military and energy purchases as well as outbound investment, while acquiescing to being subjected to a trade policy that would have been essentially unthinkable a few months ago. If the Trump administration were purposefully trying to peel the EU, the U.K. and Japan away from America's system of alliances, it would be hard-pressed to find a more surefire method than these deals. They put to rest a benevolent vision of America that has underpinned our soft power worldwide for 80 years.
Business Insider
a minute ago
- Business Insider
How AI can help power grids survive the data center boom
Amid surging electricity demand and slow-paced infrastructure growth, modern energy infrastructure faces a swathe of challenges. While high demand is nothing unprecedented for modern grid operators, the speed at which demand is growing is remarkable — and it's projected to keep growing. Just last year, the International Energy Agency (IEA) reported that global energy consumption rose by 2.2%, representing a sharp increase from the average 1.3% increase between 2013 and 2023. This growth is also unevenly distributed, with data centers eating up an increasingly larger portion of the available production. In just the United States, the Department of Energy projects that data centers could go from consuming 4.4% of total American electricity production in 2023 to up to 12% by 2028. At the same time, just adding renewables isn't enough. Over 1,500 GW of renewable projects worldwide face delays because there aren't enough wires to deliver the power they generate. Energy grids throughout the US and the world are under extreme pressure as demand growth far outstrips the speed of new infrastructure construction. Decentralized power with complex demands Most of the energy we use today comes from distributed energy resources (DERs) like hydroelectric dams, wind turbines, or solar panels. The state of California leads in DER adoption, with rooftop solar installations growing 34% year over year in 2023. Investments in DERs are projected to increase sevenfold worldwide by 2030 and reach up to $846 billion within a decade, with an additional $285 billion allocated to energy storage systems. This shift toward decentralized generation brings tremendous benefits, like enhancing the resilience of our energy infrastructure, but it also demands real-time coordination far beyond what operators are used to. Traditional grid management methodologies cannot dynamically balance this kind of complexity while maintaining stable voltage levels. Part of the problem, part of the solution While AI is one contributor to this heightened demand and complexity, given the energy needed for data centers that run high-powered LLMs, it can also be the key to navigating this new paradigm. Since it can process information at a speed and scale far beyond a human level, machine learning can be deployed to analyze usage data and dynamically adjust systems when needed. AI offers immense potential when it comes to identifying emerging instability patterns, diagnosing root causes, and using data to suggest corrective actions. Case studies for AI and energy management AI's transformative potential lies in shifting energy management from reactive to predictive. Consider the case of Ercros, a chemical manufacturer in Sabiñánigo, Spain. For them, AI analysis of their plant's power consumption proved to be more than an immensely valuable asset: It helped them avert a disastrous outage. Production at Ercros requires flawless voltage quality on an 11 kV line. Continuous monitoring devices transmit real-time data to a Siemens cloud analytics platform, where AI algorithms compare this information to past benchmarks. During operation, the system detected abnormal reactive power consumption and harmonic distortion. "Thanks to the warning, we could see that we had a problem with a capacitor battery and a 5th harmonic filter," said Roberto Díaz Juan, head of engineering and maintenance at Ercros. The alert recommended filter protection upgrades to prevent external transients from tripping the system. AI's predictive capability extends beyond industrial facilities to entire distribution networks. Elvia, Norway's largest grid operator, confronted a different challenge: managing low-voltage networks across a vast area that also sports the world's highest adoption rate of electric vehicles and heat pumps. Elvia's solution centered on Gridscale X LV Insights from Siemens Xcelerator, which constructed a comprehensive digital twin of their low-voltage infrastructure, factoring in different kinds of data sources. Now in place, the platform provides complete grid transparency, identifies overload risks before customers experience disruptions, and optimizes hosting capacity without physical expansion. "With increased flexibility and oversight over our grid, we can now manage our low-voltage system in a much more efficient manner — from planning to operations and maintenance," said Erik Jansen, head of grid operations at Elvia. Leveling up digital transformation A fundamental shift in operational capability is needed to address tripled demand, integrate decentralized renewables, and prevent cascading failures. Gridscale X from Siemens Xcelerator can help American companies evolve, with a modular software architecture that seamlessly and quickly integrates within existing IT/OT landscapes for end-to-end grid visibility and control. By deploying AI and smart algorithms, Gridscale X acts as an energy co-pilot: it continuously analyzes complex grid data, identifies potential instability, diagnoses root causes, and recommends prioritized, actionable solutions. Protecting energy systems, from individual plants to whole regional grids, is no easy task — unless you've got the right tool for the job. As the energy industry evolves, smarter AI deployment will be key for industry players seeking to reach the next level in their digital transformation journeys.
Bloomberg
2 minutes ago
- Bloomberg
Oil Fluctuates as Focus Shifts to Zelenskiy Meeting With Trump
Oil swung between gains and losses as traders awaited a meeting between Presidents Donald Trump and Volodymyr Zelenskiy, with the Ukrainian leader facing US pressure to agree to ceding territory to Russia. West Texas Intermediate futures were little changed near $63 a barrel after fluctuating in a roughly $1 range. In a show of support, European leaders including European Commission President Ursula von der Leyen, French President Emmanuel Macron and NATO Secretary-General Mark Rutte will join the high-stakes meeting in Washington.
