BlackRock’s recent filing for a bitcoin ETF has sparked a lot of excitement in a market that had been otherwise a very depressing one. Some even say it marks the start of a new ” crypto-summer.

What do you believe will be the biggest benefit from this? asks Avi Felman.

The head of trading digital assets at GoldenTree responds to his own question. “There’s this wonderful instrument, GBTC.”

Felman says that if Grayscale was to be turned into an ETF after BlackRock it would be a great trade’.

He says that the stock is currently being traded at a discount of 33%.

Felman explains to Cumberland’s Global Head Of Trading Jonah Van Bourg, on the 1000X Podcast ( Apple / Spotify ), that GBTC stocks sell at a discounted price compared to their bitcoin underlying assets. This creates some interesting opportunities.

GBTC is sold at a price lower than the BTC because Grayscale is currently structured as a Trust and does not offer asset redemption for its shares. Grayscale aims to be an ETF but it’s currently structured as a Trust. The price of GBTC can deviate from BTC’s value due to supply and demand dynamics.

The shares are currently being traded at a discount but have previously been at a premium. Grayscale is a good option for traders who want to avoid the risk of holding the digital asset themselves. Hardware wallets and twelve-word phrases don’t seem like they would fit the institution vibe.

The Securities and Exchange Commission refused to accept the company’s application for 2022, resulting in a lawsuit which has not been resolved.

GBTC’s recent price surge was a result of news about BlackRock’s ETF and a of subsequent institution filings. Van Bourg warns against relying on the current discount and says that GBTC is likely to sell again ‘at some stage’.

Van Bourg says that Grayscale’s owner, DCG, is the reason for his hesitation. We don’t know whether the managers at DCG are driven more by “reputational” concerns or if their economic rationality is a concern.

Grayscale does not have to compete

Van Bourg says that ‘theoretically’, the textbooks say they should do nothing.

‘Whatever happens to the price of GBTC, it does not change the fees collected by Grayscale. The only thing that changes their fee is the fluctuation of bitcoin’s price.

“They collect 2% every year of the bitcoins held in the fund.”

Van Bourg says that Grayscale does not have to compete against BlackRock, who has filed for an ETF. Van Bourg says that even if GBTC is fire-sold at a discount of minus 90 percent, Grayscale will still be collecting the same fees.

Van Bourg says that if a BlackRock ETF is approved, Grayscale may be better off buying back their own shares at a discount. Grayscale would be able to convert their trust in an ETF after BlackRock clears a regulatory pathway.

He says that it would be unjust to treat your investors in this way, but if you are purely rational from an economic perspective, then that could make sense.

There is a risk of downside.

Felman argues the likelihood of such a move being made is ‘extremely small’ because it would have legal and reputational consequences.

He says that they are trying to build their business rather than generate a lot cash quickly and expose themselves to legal liability.

Felman acknowledges that a number of people have committed worse crimes in the crypto world.

Van Bourg: ‘Let’s imagine you are managing GBTC, and BlackRock releases a product which is infinitely superior.’

Grayscale investors are likely to move into BlackRock. This will leave the company with no choice but allow redemption of GBTC share. ‘GBTC will be redeemed, and assets will get moved into something more institution.

Environmentalists have targeted various technologies in recent years, but during the past 24 months, they’ve focused a lot of attention on bitcoin mining. The insatiable desire to reduce carbon footprints has now been directed at artificial intelligence (AI), a trend that is taking the world by storm.

It’s clear that AI is a very popular technology in 2023. Openai’s Chatgpt and other innovative software have been released. But several articles and academic papers have claimed that AI consumes a huge amount of energy, and has a large carbon footprint.

Bloomberg published a article stating that ‘AI consumes more energy than any other form of computing. According to the article, media members use a trick to make it appear that machines are stealing energy from humans.

Josh Saul, Dina Bass and Bloomberg claim that training a single [AI] can consume more energy than 100 U.S. households use in a year. The report notes that although researchers have calculated a total for how much energy it takes to create an AI model, there is still no estimate of the total power used by the technology.

Academic Paper Published by Students from the University of Colorado Riverside, and University of Texas Arlington, claims that Chatgpt not only uses a lot of energy, but also utilizes water to cool data centers.

The paper states that Microsoft’s AI facilities in the United States use so much water that it could cool ‘370 BMW cars, or 320 Tesla electric vehicle’. The paper claims that the GPT-3 training model used 185,000 gallons.

Mark Labbe is an author for techtarget.com. insists ‘data centres and large AI models are harmful to the environmental.’ A article on numenta.com claims that AI is also ‘harming’ our planet. The author says the trend will accelerate climate change if it’s not addressed.

Many people do not agree with the alarming headlines and studies, believing that the so-called “climate crisis” is a falsehood. A report by the Gatestone Institute, for example, claims that climate alarmism harms the West.

Drieu G. Godefridi is the author of the Gatestone Institute. He says, “Future generations are going to judge us harshly because we allowed extremist environmental activism infeeble the West.” John Shewchuk, a meteorologist at the Gatestone Institute, insists climate alarmism has no basis.

Shewchuk Tweeted on 16 April: “Climate alarmism is not a substitute for facts.” Our primate ancestors developed when temperatures were 20 degrees F higher than they are today. There were also no polar glaciers. Earth is relatively cold and getting colder climatologically.

Climate activists insist that the science is settled.

Climate alarmists do not only target bitcoin mining or artificial intelligence. Recent AFP report has been criticized for blaming the rice farming industry for significant CO2 emission. AFP report states that scientists say rice is a necessity if we want to reduce greenhouse gas emission.

AFP’s Sunday tweet was criticized for claiming that rice farming is responsible for CO2 emissions. ‘What cannot be ignored is that rice is literally a top food source for millions of people’, responded on the AFP twitter account. ‘Eliminating the rice crop would cause millions to starve… and people like you [AFP] don’t mind.’

Thomas Massie also criticized AFP for its video tweet. Massie said, ‘The fact climate wokes are going to rice shows how illogical and irrational they are.’ “Mature trees release large quantities of methane.” Methane is released by ponds and lakes.

He added that methane is released when organic matter decomposes in the absence oxygen, or in the stomachs of termites and herbivores. Truthfully, people think that arbitrary opinions and subjective evaluations of what’s good for the environment and what’s not should be investigated.

While bitcoin is a currency that can be used without censorship, others argue it should also address concerns about climate change. The environmental impact of artificial intelligent and rice farming have also been scrutinized. Many people follow the rules set out by climate experts and bureaucrats. However, some hold contrary views. They argue that science has not been settled.

Coinbase, a digital asset exchange, has tested the artificial intelligence ( AI) chatbot created by Openai for automated token reviews. According to the U.S.-based trading platform, Chatgpt wasn’t accurate enough to be integrated immediately into its asset review process but it had enough potential to merit further investigation.

This experiment is part Coinbase’s effort to use efficient and effective methods for reviewing token contracts before listing the assets. The exchange explained that the Blockchain Security team uses in-house automation tools to assist security engineers in reviewing ERC20/721 smart contract contracts.

ChatGPT by OpenAI has been a hot topic due to its ability to detect security flaws. We wanted to see if this could be used as a frontline tool and not just for code review.

Coinbase explained that Chatgpt had shown promise in improving productivity across a wide variety of engineering and development tasks. The AI tool can also be used to optimize code or identify vulnerabilities.

A leading American cryptocurrency exchange conducted an experiment to determine if Chatgpt’s token security review was as accurate as a standard review done by a blockchain security engineer using their internal tools. The chatbot needed to be trained to recognize risks according to the platform’s security review framework in order to produce comparable risk scores.

Researchers compared 20 smart contracts risk scores between Chatgpt, and a manual security inspection. The AI tool produced identical results to the manual review 12 more times. Five of the eight missed cases were instances in which Chatgpt mistakenly classified a high-risk asset with a low-risk one. The exchange stated in a blog that underestimating a risk score can be more damaging than overestimating it.

Coinbase claims that Chatgpt’s efficiency has been amazing, despite the tool’s inconsistencies and ‘worst-case failure’. The company believes that the accuracy of the tool could be improved with prompt engineering.

Coinbase stated that the bot can’t be relied on to do a security review. It also stated that the bot can’t be relied upon to perform a security review. However, its team could improve the accuracy. It means engineers could potentially use it to perform additional controls checks to detect potential risks that might have been missed.

Openai’s Chatgpt platform is in the spotlight due to growing popularity of artificial Intelligence applications. Binance, the largest cryptocurrency exchange in the world, had announced that it was launching an AI-centric token ( NFT ).

This week will again bring important macroeconomic data to the Bitcoin and crypto markets. Investors should be aware of this. While Bitcoin has been able to maintain a positive correlation with the S&P 500, and the Dollar Indexing recent week’s, it is probable that the Federal Reserve will continue to have an impact on crypto.

Even though the week has started quiet, there are two macro events this coming week that could prove to be important. The U.S. stock exchange opens with a day off because of Presidents’ Day. Quarterly earnings will continue Tuesday through Friday.

Major retailers will be able to test the strength and viability of the U.S. stock exchange rally over the coming week. Investors can get a glimpse at the health of consumer spending as well as the effect of inflation on corporate profits. Walmart and Home Depot will publish their reports on Tuesday.

What’s the Deal with Bitcoin Rally?

The FOMC Minutes will be the first major event on Wednesday, 22 January at 2:00 EST. This report provides detailed information on the FOMC meeting February 1 and offers insights into the financial and economic conditions that influenced interest rate voting.

Investors in Bitcoin and financial services will be paying more attention this time around. Last week, several Fed speakers stated that the rate decision was not unanimous. They supported a 50 basis-point increase. Also, there were elevated CPI revisions last week and a strong January report.

Some voices believe that the Fed could use these minutes to make some sly corrections based on the negative data. The Fed Minutes could indicate an imminent rate hike that could sabotage the financial markets.

Powell also indicated that the minutes would provide information about how the Fed will decide when it will pause its rate-hike cycle. This is an important data point for financial market investors.

The Fed will likely request multi-monthly inflation data. This signals that it is on track to reach its 2% target. The Fed will now be focusing on the tight labor market as wage pressures are not compatible for a 2% inflation rate.

Bitcoin investors should be paying attention to the FOMC Minutes to see if Fed increases its hawkish stance. The recent Bitcoin decoupling will likely be tested.

The release of the core PCE price index, the second major event in the week , will be the second. Because it is more accurate than the Consumer Price Index, the PCE price index (Federal Reserve’s preferred measure for inflation) reflects consumers spending habits in a quicker manner than the CPI.

Core is the absence of volatile or seasonal prices for food and energy, which is not included in the PCE. The Core PCE has dropped from 5.1% to 4.4% over the past year, most recently in January.

It is now expected that it will have increased 0.4% in January from 0.3% in December, and 4.3% YoY. If the PCE surprises negatively and it exceeds expectations, then fears of sticky inflation will likely become stronger. This could also put a damper in the Bitcoin price.

After being rejected again at the critical resistance of $25,223, Bitcoin’s price was at $24,520 at press time.

Bitcoin could reach $50,000 within a few years as cryptocurrencies recover from a terrible year, according Anthony Scaramucci.

SkyBridge Capital founder stated that he expects 2023 to be a “recovery year” for digital assets. He believes it will create a longer-term bitcoin rally, which will raise the token’s value to between $50,000 and $100,000.

Scaramucci said CNBC last week that while you are taking on risk, you also believe in adoption.

“So, if we get adoption right – which I believe we will – this could easily become a $50,000-100,000. asset over the next two-to three years.”

As traders anticipate that the Federal Reserve will reduce its large-scale interest rate hikes to curb inflation, cryptocurrencies have risen since the beginning of 2023. Investors will be more inclined to save their money in interest-bearing savings accounts than invest it in assets, the higher the rates.

The leading cryptocurrency bitcoin has seen a 26% increase to trade at $21,000. Meanwhile, the second-largest token ether has risen above $1,500 following a 29% surge.

However, the rally was not significant enough to offset the losses suffered by cryptocurrencies in 2022.

Both ether and bitcoin are still below 50% in the last year. The demand for crypto has been impacted by rising interest rates and the implosions of well-known companies such as FTX, Celsius Network and Celsius Network .

Despite the market downturn, Scaramucci continues to believe in the sector. He stated Monday that he will invest his own money in the new crypto startup of former FTX US president Brett Harrison.

“Brett, I am proud to invest in your company. Keep moving. Do not look back. In reply to a tweet thread in which Harrison wrote about his experiences working for the failed crypto exchan, Scaramucci stated that he wished him the best.