ECB Critiques Bitcoin: A Valuation of Zero

The Breakdown First Five - Friday, February 23, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Adam Back Puts Satoshi Emails on the Record

The Craig Wright v COPA trial continues to be a sideshow, but it did turn up one genuinely historic moment. During his testimony against Wright, Blockstream CEO Adam Back has placed his never before seen correspondence with Satoshi into evidence. The emails contradict Wright’s version of the story, but more importantly give an insight into the months leading up to the Bitcoin whitepaper. Satoshi seemed like he could hardly wait to unveil his creation. 

4. Marathon Goes Direct

Marathon Digital has launched a service to accept Bitcoin transactions directly from customers. The service, called Slipstream, will allow Bitcoin users to place irregular or complex transactions into Marathon’s private mempool. The measure has an obvious use case of getting around the filtering of Ordinals transactions out of the public mempool. It could also have privacy implications, allowing transactions to remain hidden until they are written to the blockchain. 

3. Kraken Claims Retaliation

Kraken has spoken out about perceived retaliation by the SEC for having the temerity to speak out at a congressional hearing. Kraken had testified that the SEC’s strategy would not protect consumers and that Congress should restrict their power in favor of other agencies. The next day the exchange was hit by a lawsuit that they are currently gearing up to fight. They have now filed a motion to dismiss. 

2. Reddit’s Crypto Bags

As part of their filings to IPO, Reddit has disclosed holdings of Ethereum and Bitcoin. The social media platform also said it holds some Polygon tokens as a result of digital collectible sales. Reddit claims their bags are “immaterial” and did not disclose the size of their holdings. Although their holdings are not significant, the first company to put Ethereum on their balance sheet certainly is, suggesting that there is no regulatory barrier to doing so. 

1. ECB Says Bitcoin Has Failed

The European Central Bank says that Bitcoin has failed as a decentralized currency and has a fair value of zero, so I guess we can all just give up and go home. The last time the ECB called Bitcoin a failure was at the very bottom in November 2022. This time around, the ECB has said that the “financially less educated” need to be protected from their own investment choices. They believe that forceful prosecutions are warranted in light of illicit use.