John Oliver, trueEX, and BIS Move ETH

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By Gaurav S. Iyer, IFC Published : March 13, 2018

iStock.com/SergSim

Ethereum News Update

Ethereum prices are plummeting on Tuesday morning, in part due to an episode of Last Week Tonight with John Oliver and a report from the Bank of International Settlements (BIS).

Oliver’s show, for those who may not have seen it, features a comedic deep-dive into hot news topics of the week. This week’s episode centered around Bitcoin, blockchain, and the sudden rise of cryptocurrencies.

While the episode carefully detailed how cryptocurrencies work, Oliver also poked fun at the sycophantic enthusiasm you often find in cryptocurrency evangelists.

It’s tempting to brush off Oliver’s segment as insignificant, but that underestimates his reach among millennials and opinion-makers. National news outlets trumpet his “hot takes” each week, plus his viral bits are often trending on YouTube.

He is a thought leader, like it or not.

That said, Oliver’s warning to “be careful” when investing in cryptocurrencies cannot be held responsible for today’s crash. At least not by itself. He might have had help from a new report by the Bank of International Settlements.

The BIS report claims that central bank-issued cryptos (an idea that is getting more popular by the day, just ask Venezuela) could weaken the financial system.

The report’s authors argue that in times of stress, investors might treat the digital asset as a commodity rather than a currency. “It would be difficult to stem runs under such conditions, even when providing large lender of last resort facilities,” the report reads. (Source: “Committee on Payments and Market Infrastructures,” Bank of International Settlements, March 2018.)

Of course, there are a lot of hypotheticals in the Bank’s arguments.

I don’t want to list all of them right here, but the material point is simple: Both the BIS and John Oliver added more fear, uncertainty, and doubt (FUD) into cryptocurrency prices.

There’s only one shining fragment of hope, and it comes from trueEX, an online market for interest rate swaps. The company has two projects pending:

  1. A derivatives market for cryptocurrencies
  2. An ETH price index, in partnership with ConsenSys

Both of these projects are bait for institutional investors. trueEX is luring the wolves of Wall Street into the mix, ostensibly to improve the cryptocurrency ecosystem, but with the side effect of driving Ethereum prices to new highs.

eth price chart for 13 mar

Analyst Take

I maintain a long-term view of asset prices, meaning it would be foolish to adjust price targets based on daily news reports. As such, our $1,500 Ethereum price forecast for Q2 and $2,500 for the year remain unchanged.





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