What do Addison Rae, Snoop Dog and Elon Musk have in common? They all invest in crypto.
The US Securities and Exchange Commission has warned against the danger of investing in a cryptocurrency because a celebrity says to.
“Celebrities, like anyone else, can be lured into participating in a risky investment,” said the SEC.
“It’s never a good idea to invest in something just because someone famous says it’s a good investment.”
The City Watchdog also has warned that many of the cryptocurrency trading schemes promoted by celebrities turn out to be scams.
Because celebrities make money through attention, they generally are free to make more risky investments than your average Joe.
The larger their following, the more the celebrity is able to artificially pump a particular coin or crypto on their platform.
Elon Musk, Snoop Dog and Addison Rae
We’ve already seen how celebrities can leverage their influence to affect crypto markets. It seems as though all Elon Musk needs to do is send out a Tweet, and the whole market goes to chaos.
Earlier this year, Dogecoin soared by $10 billion after Musk tweeted the memecoin looked “promising”.
Converselly, the coin plummeted after Musk called himself ‘The Dogefather’ during his SNL cameo.
But Elon Musk isn’t the only celebrity dipping his toes into crypto investments. Tik Tok star Addison Rae’s family recently got involved in crypto through their investment in Gryphon Digital Mining.
“Sustainability is so important to me and my family,” the actress said in a statement. “We are excited to be part of Gryphon, a company that uses 100 percent renewable energy to drive innovation in blockchain technology.”
Fellow TikTok star Johnson has more than 10 million followers on the platform and sees the move as intuitive. “Crypto is shaping the future of currency, and as a young entrepreneur, I want to make sure I am a part of that shift with the best in the business,” the influencer, 22, said.
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New proposal: biggest crypto regulation America has ever seen
One US lawmaker has just unveiled his plans to introduce the most sweeping and far-reaching crypto regulation policies America has ever seen
Known as the “Digital Asset Market Structure and Investor Protection Act”, it has been introduced by Democrat Don Beyer.
If passed, the bill will allow the Treasury Secretary to oversee the creation of stablecoins, direct regulators when it comes to decentralised finance and even create a crypto-exchange charter.
Unlike previous attempts to regulate crypto, this bill appears to be fairly wide-ranging and covers a number of issues at one time.
It comes as the US Senate moves to finalise Biden’s $1 trillion infrastructure package which includes provisions that will increase crypto reporting requirements – in a bid to raise around $28 billion in tax.
However, the infrastructure package has a narrow focus on crypto and is far less sweeping than this latest Digital Asset Act.
Law firm Axler Goldich told Coindesk “for a proposed legislation that seemingly came out of nowhere, it is incredibly comprehensive and the authors clearly have an understanding of the underlying technology”.
Beyer’s bill is the second crypto-related legislation to be introduced this week as lawmakers become increasingly focused on regulating the sector.
Britcoin set to make Bitcoin skyrocket
Cash in people’s pockets would be superseded by a new ‘Britcoin’ digital currency in a plan being pushed by Chancellor Rishi Sunak
Britcoin, the Bank of England’s reported digital currency, rather than overtake Bitcoin, will push the cryptocurrency’s price higher, affirms the CEO of one of the world’s largest independent financial advisory, asset manager and fintech organsitions.
The comments from Nigel Green, CEO and founder of deVere Group, come after it was reported that the UK central bank is planning to launch a direct digital equivalent – dubbed ‘Britcoin’ – to physical money.
Mr Green says: “Revealing just how worried they are about the ongoing epic rise and influence of Bitcoin, and other cryptocurrencies, the Bank of England is reportedly set to establish its own digital currency – which they have previously routinely dismissed.
He continues: “It can be expected that Britcoin will push Bitcoin prices higher for three key reasons.
“First, in what will be a masterclass in the law of unintended consequences, by jumping on the bandwagon, central banks are validating the concept of Bitcoin and its inherent values of being digital, global, borderless, quicker and more cost-effective than traditional money.
“By adding further legitimacy to the market, it’s likely that innovation and development will increase, the crypto ecosystem will become even more robust, and the pace of mass adoption will be accelerated.
“Second, whilst Britcoin will have many of the plusses of Bitcoin, it will still be controlled and manipulated by the Bank of England, meaning they can adjust supply and therefore its value. With Bitcoin, there is no single authority and a progressively limited supply.
“Furthermore, in the increasingly digitalised and globalised economy, why would businesses, such as Amazon for example, in the longer-term favour a currency that is digital but not borderless in the same way as cryptocurrencies are?”
“Third, there’s a growing mistrust of the traditional bank system by the younger, ‘digital-native’ generations who are becoming the beneficiaries of the largest transfer of wealth in history as baby boomers pass on their assets.
“They’ve been influenced by the enormous surge in tech as they came into adulthood – which came around the same time as the global financial crash that hit in 2008.
“Britcoin will be controlled by a handful of people from the Bank who have conversations and make decisions behind closed doors.
“Bitcoin is controlled by no one and discussions are held out in the open and decisions are transparent and community-based. Which one do you think is the future of money?”
The UK is not the only country said to be working on plans for digital currencies. China hopes to become the first major central bank to issue a Central Bank Digital Currency (CBDC). The European Central Bank is exploring the launch within the next five years of a digital euro. The U.S. Federal Reserve has said it will not rush any digital dollar. This year will, however, be critical in getting the ball rolling, its chairman Jerome Powell has recently said.
The deVere CEO concludes: “The Bank of England’s reported move to set-up Britcoin highlights that digital currencies are the inevitable future of money.”
Bitcoin on a winning streak after rising above $40k
Crypto investors are keeping a close eye at the recovery of Bitcoin, as the digital coin rises to a new high
The continuing recovery in Bitcoin has put the largest cryptocurrency on course for its longest winning streak this year.
Bitcoin, the world’s biggest crypto, rose as much as 5.8% to top $40,000.
It’s advanced for eight straight days. Other coins including second-ranked Ether, also climbed.
Recent positive comments from billionaire Elon Musk and Ark Investment Management LLC’s Cathie Wood have helped the crypto recover.
However, the currency still has a long way to go before reaching its official all-time high of $64,829.14.
For those who still don’t really know how Bitcoin works:
Bitcoin users send and receive coins over the network by inputting the public-key information attached to each person’s digital wallet.
In order to incentivize the distributed network of people verifying bitcoin transactions (miners), a fee is attached to each transaction. The fee is awarded to whichever miner adds the transaction to a new block. Fees work on a first-price auction system, where the higher the fee attached to the transaction, the more likely a miner will process that transaction first.
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