***Qrafty unfurling the crypto carpet*** Welcome, fellow digital coins aficionado! A new beautiful day in the crypto jungle blesses us with its wonders and I, Qrafty the crypto lovin’ honey badger, extend a hearty welcome to Coinqraft – your personal guide to the crypto wonderland! It's like a chest overflowing with precious crypto nuggets, tailor-made for the sharp-minded and the curiously curious.🌟

🦡 So dive into the crypto rabbit hole with your favorite badger buddy because Qrafty just got back with news 📰 and scoops 🔍 from the crypto jungle, so here’s what’s today letter is about:

1. Europe approves Bitcoin ETF ahead of US

2. Coinbase gets approval for crypto futures in US

3. Adidas issues limited edition sneakers with NFT’s attached

Bonus: How the president of El Salvador flexed on shorters.

Today’s Story

The History of Money or how Bitcoin removed human labor from the equation of capital - part II

Qrafty will continue the story of how we got to the version of money that we have today. Yesterday, Qrafty started the story from ancient times and we have now reached the Medieval period, where profitable merchant families in Italy needed capital management and preservation services for themselves, which led to opening their own banks.

One of the most famous families to do so is still known today, the Medici family. One of the beautiful and special side effects of this was that it sparked the Renaissance, a magnificent expression of the artistic creativity of the human spirit in the form of sculpture, paintings, poetry, music and the expression of beauty in all its authentic forms.

Ok, Qrafty, got it. How was banking done back then?

Well, turns out that business went well and it worked out pretty good! The banking system spread throughout northern Italy and, by the end of the 13th century, the economic stage saw a trio of credit players stepping into the spotlight:

• the pawnbrokers 🙈 

• the moneychangers 🙉 

• deposit banker 🙊 

There were also the merchant bankers, which were regarded as the heavyweights of the profession, since they were the first of their kind… ever. They would reach a high level of wealth and run entire cities and areas from the shadow, lending to kings, nobility and clergy. And, of course, obtaining favors and special rights. Rings a bell? Oh and since they were mostly relatives or somehow related to the Church, they were always in God’s grace, get it?

Opposed to them were the pawnbrokers, the sinners and the damned ones for eternity in the fires of hell for their immoral dealings with the dirty money. Unless they repented and donated everything they accumulated to the Church, in which case they went strrrrrrraight to heaven, knocking champagne with the saints while listening to heavenly harp lo-fi on a divine golf session in the clouds. That painted a pretty cool picture, didn’t it?

The moneychangers would do exactly as their name stated, charged a fee for converting a currency into the other; they didn’t work with credit.

And we are left with the deposit bankers, which is where the relationship between the state and the bank started as well. Rome, Venice or Genoa among other Italian cities were starting to establish themselves as centers for banking.

The records preserved in Genoa show that deposit bankers back then were responsible with changing the currency as the market needed. But also to be on the lookout for fake coins and act as a supervisor of the overall circulation of capital.

This evolved into the government requiring them to have cash and records for inspection. Banks also had to obtain guarantors who would back up any outstanding debts they would acquire, up to a certain level. In turn, the government gave these financial entities credibility by making the entries in the banking records legal. So whatever the bankers wrote in their books, it suddenly became legally enforceable, get it?

Suddenly, people found it pretty handy to put some of their money into bank accounts. They'd even get a little something extra – like a secret interest – while using those accounts for getting and sending payments with written notes in the banker's records.

If someone was trusted, they could sometimes spend a bit more than they had in their account (within certain limits, of course). This is the initial form of credit, it’s basically a trust based relationship denominated in currency.

And get this: the bankers could legally use the deposits from their customers to invest in their own business.

But how was credit score built, Qrafty?

Ha, good question! Credit score is basically a level of trust reduced to the form of a number, that is granted objectively based on the person’s actions, not subjectively based on personal affinities.

So the initial form of credit score was built among banks by providing liquidity for currencies in regions where the bank didn’t have coverage.

How does that work, Qrafty?

Well, imagine you have some coins, but you need them in a different place. You ask a friend who lives in the area to lend you those coins there. Now, your friend agrees to lend you the coins and says you don't have to give them back there – you can wait and give them back in your own place. It’s like you help me, I help you.

Remember, these operations were being done with other established merchants, bankers, and government officials of different regions, kings and the Pope. So now you can understand how banking and power are related to this day.

Now, it’s important to mention that the Church turned against banking and the emerging financial system, multiple times, for practicing lending at enormous rates and basically robbing people. Rings a bell? The Church called this “usury“ and almost all money changers and merchant bankers faced this at some point in the Middle Ages.

It was also a method of establishing monopoly through faith on the circulation of money and acquisition of power. But esentially, this was to protect the regular people from the greed of bankers. And to contain the immense power and influence that these were accumulating.

The usurer is merchant banker raking in profits without lifting a finger. 🏦💰 Lending money at interest lets them cash in while kicking back, which goes against the church's "sweat of your brow" rule, which means that you consume what is within your ability to work for physically, since work is the payment for our sins, duh! This, in time, lead to bankers being linked with evildoing of the highest order: robbing and pillaging, thieves and sinners.

This went on for a while and baking spread more and more through the Middle Ages. These are the pioneers of banking as we know it today. The shoulders of the giants on which our modern bankers sit and … well… you decide what they do exactly.

Tomorrow, Qrafty will continue with how banking evolved after the Middle Ages period and how the Dutch improved the system in the 17th century. Of course, Qrafty won’t forget the British who added their touch in the 18th century.

🙃 Qrafty hopes that today’s main story brought brave badgery value to you! Now it’s time for a break, you deserve a bit of fun! 😇 👇️ 

Since we’re having a deluge of ETFs lately, maybe it’s time to remember what Bitcoin stands for.

A good giggle… priceless. For everything else there’s… laughing hysterically.

Here are the main news of the day

1. CEXes are NOT your friend!

CEX means centralized exchange, a place where you go to buy coins that you are interested in and you couldn’t find anywhere else.

Unfortunately, for most newcomers a CEX is like a casino where you go to gamble your money on the future increase or decrease of the price of a coin. This is the case for most first time users, who gamble away their money due to magical thinking. They just make an account on an exchange and money will flow just because they’re special. It’s true that exchanges market themselves in this manner, but marketing isn’t lying, isn’t it? Isn’t it?!

Some CEXes have a wider offering of services, others a more reduced one, but the essential service is allowing users to buy and sell coins and store them in the exchange wallet.

Most users somehow think that exchanges are friendly towards their users and interested in helping them make money in the crypto market. That couldn’t be more wrong! An exchange is a for-profit entity who’s only purpose is to extract as much money as possible from its users.

Just like Qrafty mentioned about Robinhood in a previous post, the same is true for all exchanges: they don’t have any obligation towards you (except parting you from your money as efficiently as possible).

2. Coinbase gets approval for crypto futures in U.S.

This is the actual news about Coinbase, so now you understand why point number 1 👆️ was mentioned.

What’s the catch, Qrafty, why is this important? 

It’s important for multiple reasons. First, Coinbase might be trading against its customers. True, all exchanges do that, but Qrafty doesn’t see anyone talking about this. So it’s all about money, baby! It’s important to understand that the real money is in futures, not in spot.

Also, Coinbase opened up a risk management office in Singapore, to test with $100 million, which is a nice way of saying they’re operating a shadow hedge fund to trade against their customer base. They allegedly closed it, but somehow it’s still working and hiring.

Why would they do that, Qrafty?

Remember what Qrafty said above: the exchange has no obligation to you. On the contrary, the exchange needs to make money for its shareholders and investors. Who’s money? Customer funds. 😁 

When you place an order on an exchange, the exchange knows your liquidation levels, your position size, leverage, everything. It’s their platform!

Also, the exchange adopts the opposite position to yours because for every buy there’s a sell, but that is normal and that’s what happens on all exchanges.

Most importantly, they know at what price you can be thrown out of the market, penniless (if you don’t know risk management, why is often the case for inexperienced traders). So Coinbase (and remember, pretty much all exchanges) have a division that bets against you.

What do you mean?

It’s like a game of poker where you can’t see their cards, but they can always see your cards and bet against you. And they can also game the deck most of the time. So yeah…

But for Coinbase, it seems that the risk management division in Singapore, which is basically the hedge fund, is located in the exact same office space with the one that handles retail data (that is you and me, our positions, as I was mentioning above). So now we should trust that the hedge fund will not take the data from the retail office and make money off of it.

They also registered their risk management office in Singapore because they couldn’t operate a hedge fund in the US due to regulations which made it impossible for them to do so.

Oh c’mon Qrafty, you’re exaggerating… 

Nope, FTX/Alameda used the exact same playbook! It’s the easiest play. Why would you risk capital on the open markets where you don’t really know a lot against ultra pro hedge funds, trading bots and quant algos when you can just bet against your customers, from which you have all the data that you need? It’s just like fishing in a barrel with a shotgun. You can’t lose!

Well… that is unless you are a complete cretin and manage to overextend yourself to such a degree that you bring down an entire exchange and almost the entire crypto market with it. But that story has been told before.

There’s also some interesting reading about the Coinbase and Luna crash, you can catch up here.

Just to be clear, Qrafty exists to help you have a clear image of the crypto ecosystem and make smart decisions. Qrafty isn’t here to point fingers or to accuse anyone, but to educate you on who the actors in the market are and how they operate.

3. The flood gates are open for Ethereum ETF’s?

As usual, hopes are high and words abound, hype hype hype! The company that made the announcement is called Volatility Shares, “a pioneer in the ETF space”.

Their proposal for the ETF is a cash settled ETH futures contract to be traded on the CBOE (Chicago Board Options Exchange). Time will tell if the SEC will agree with this. Qrafty believes that this isn’t going to happen anytime soon, unless the SEC suddenly decides to approve a bunch of ETF at the same time.

Valkyrie, an asset management firm, also filed for an Ether futures ETF. So they won’t buy ETH directly, but buy futures contracts.

Aside from Volatility Shares and Valkyrie, the others that have applied for an ETH ETF are ProShares, Grayscale, Bitwise, Round Hill Capital and VanEck.

Will we have an approved Ethereum ETF, or even more of them, before a Bitcoin ETF? This would turn the market upside down, it would genuinely be a shock and definitely popcorn time! 🍿

4. FedNow is using Hedera HBAR

Hedera’s HBAR token jumps about 15% on the announcement that FedNow will be using its microtransactions application, named Dropp.

What Dropp does is that it allows small purchases to be paid directly from bank account instead of credit cards, which carry high fees. Considering that most payments are small ones, it’s really interesting to have a system that would allow micropayments with small or close to no fees.

What does this mean more exactly, Qrafty?

It means that you could make a payment of 35 cents without paying 50 cents fee for the transfer. The high fees were the barrier for small payments. This has the potential to unlock a lot of small payments use cases, like tipping streamers or creators, paying for parking.

5. Adidas & BAPE team up for limited sneakers

They are issuing a limited edition of 100 sneakers, titled the Triple White Forum 84 BAPE Low. What’s cool about them is that these will have an NFT collection attached.

This is to celebrate BAPE’s 30th anniversary. Pretty cool idea and good marketing stunt, Qrafty is impressed.

As Qrafty was mentioning, these sneakers will be issued via an auction and will have an NFT counterpart, which users will access by scanning a chip placed on the left tongue of the sneaker. The users will be able to wear the NFT in the digital realms of the metaverse

6. First Bitcoin spot ETF in Europe approved

Usually, cool new things in Europe tend to be more dull and happen later than in the US. But this time, this time baby, times a changin’!

Here’s a soup of words from their press release: “The Jacobi FT Wilshere Bitcoin ETF is regulated by the Guernsey Financial Services Commission (GFSC) and will trade under the ticker BCOIN".

Where will that be? Of course… Amsterdam Stock Exchange!

So what happened is that Europeans have a Bitcoin ETF to play with, while Americans… not so much. The company that listed the ETF, Jacobi, got the approval a couple of years back and wanted to list it in 2022, but they pushed back the launch date for now.

This is good for the US SEC as well, as they can gauge the interest and evolution of the Bitcoin ETF and make adjustments if needed, before approving their own ETF’s for Bitcoin and maybe even Ethereum.

7. XRP is getting love from institutions

There’s even talk about an XRP spot ETF, although it really makes no sense at this moment. Let’s not get ahead of ourselves here, there isn’t even an approved Bitcoin ETF on the market and these guys are doing mental gymnastics with XRP ETF.

Also, in order to get an ETF approved, the coin must first be listed on CME (Chicago Mercantile Exchange). Which hasn’t happened and, most likely, won’t happen in the foreseeable future. Truth is, XRP is still highly dependent on Ripple. If they are gone tomorrow, XRP will slowly fade away in the digital graveyard of dead coins.

Hey hey 🙃 Qrafty hopes you are enjoying the experience here and would like to regularly get Qrafty’s letters!

If so, please click on the button below. Qrafty is really really grateful to have you here, so thank you!

If my crypto wallet could beat me, I would be in a coma!

Qrafty’s thought of the day

Other stories from today worth noting

• The President of El Salvador: “I told you so :)“ Or how shorters lost this one

• In case you didn’t know the El Salvador drama, Qrafty’s got your back!

  The thing with El Salvador is that their president, Nayib Bukele, alongside the legislative and executive powers of the state, decided to adopt Bitcoin as legal tender in 2021.

  Because of this, Fitch downgraded their long term debt with one level and all the economic talking heads were saying that they’re going to default on a bond they had to pay in 2023, for $800 million plus interest.

  So the “investors” bet against El Salvador’s bonds hoping to profit massively from a crash. All the international media outlets went in overdrive with the same narrative, that the country had to make a deal with the IMF to sustain its finances. Fitch downgraded their long term debt, which is pretty damn nasty.

  But the thing is that it fired back and El Salvador’s president announced that they paid the $800 million on time, plus interest. That’s a pretty awesome flex, if you ask Qrafty… and a good sign for Bitcoin too!

• Base is quick to rug and scam

• Base just launched recently and it already had two rugs in less than a day: SwirlLend rugged over $460,000 and RocketSwap hacked or rugged for $865,000. Things will go on, but it makes Qrafty sad to see these things, as there are a lot of good projects with reliable people.

• Morocco submits application for BRICS

  As Qrafty mentioned previously, BRICS is important because it takes away the power of the (petro)dollar from the world trade stage. This is happening in a greater worldwide context in which we are seeing a reconfiguration of global power, from a unipolar to a multipolar. From centralized to decentralized, get it, get it? : 😮‍💨 

  This comes just before the BRICS summit in South Africa. And Morocco is not the only one! Saudi Arabia, Egypt, Indonesia want in on the party too.

  This is an economic alliance which accounts for about 40% of the world’s population and 26% of the global economy.

  Main topic of the summit? They’ll be talking about trading in their own currencies within

• Netherlands officially enters recession

  The Dutch aren’t the first ones in the eurozone to be in a recession. Since the beginning of the year, 8 countries have entered technical recession. It’s not looking bad now, but it ain’t looking good either.

  Germany started it, as they’ve been dancing with the recessionary winds for a while now and fell in the hole. Lithuania, Estonia, Malta, Hungary and Greece are on the list too, but too small to make a big impact overall.

  Speaking about traditional markets, what’s also important is to keep an eye on China.

• Keep your friends close, your enemies closer but…

  … tell no one about your crypto holdings or how much you got. Also, don’t scam people! Missing US crypto king, Christian Peev, 41, who held both US and Bulgarian citizenship found NOT alive in the worst possible way.

Feel that? What….? Your crypto IQ rising?… No no, not that! Nvm, let’s just focus on the crypto IQ, okay?

Qrafty, what are “Oracles” and what are hey used for?

Well… crypto oracles are like super-smart messengers for the digital world. Imagine you're in a game, and you need to know the score of a real soccer match. But you can’t leave the game, as you’re busy with what’s going on there.

Oracles are the ones who run to the real world, grab the score, and bring it back to the game. They do the same for cryptocurrencies. They fetch real-world info (like prices or news) and tell the blockchain so it knows what's up.

Just like a bridge between real life and the digital realm, these clever oracles keep everything honest and up-to-date in the crypto universe!

Market Whispers

Our beloved Bitcoin touched Monday’s low, went up a couple of hundreds $ and came back down to retest 29k. For now 29k holds, the question is how long is it going to hold? From 24 of July Btc is playing a touch and go game with 29k.

In case you weren’t aware, today is NATIONAL ROLLER COASTER DAY! 🎢🎢🎢

Trading Bitcoin is like riding an emotional rollercoaster with a ticket you can't refund! One minute you're on top of the world like a Bitcoin billionaire, and the next you're plummeting faster than a price dip. Buckle up, because this crypto coaster's got more twists than a soap opera marathon – joy, despair, and the occasional urge to scream "HODL!" at the moon. Or cry in a towel but aaanywaaaayyy…. 🎢🚀📉

That’s all from Qrafty 🦡 for today! Qrafty thanks you and wishes you to live each moment as if you are listening to the music you love most!

If you enjoyed Qrafty’s letters, you can make Qrafty mucho happy happy and subscribe below 👇️ Wahaha!