Fintech Focus For December 14, 2021

Good morning, this is Renato! Kim K is following in her father’s footsteps, “announcing on Monday that she passed the California First-Year Law Students' Examination.”

Props to her; she’s doing more than some elected government officials.

Also, COVID-19 went from not being a concern during last week’s S&P 500 price rise to all of a sudden being a concern on like the first small move lower, today.

I’m confused. So, if we go up, again, it will be that COVID is no longer a worry?

Next, we have bitcoin, the world’s not-so-stable inflation hedge, deflating.

That topic leads me to start thinking that the inflation narrative is nearly over.

Never do things go how we expect them to go!

Does the Fed then break something by speeding its taper and hiking aggressively? That’s what Jim Bianco is thinking, suggesting the following choices for the Fed:

• Respond to inflation and hike aggressively. The flattening yield curve says this is what the Fed will do, hike too much and break the economy.
• Don't respond to inflation and destroy their reputation and the democrat party

Anyways, here’s what I’m seeing in terms of fintech news, below. As always, whether or not you like these missives, reply to me with your thoughts!

One Big Thing In Fintech: The great overdraft overhaul, the cryptofication of banks, faster payments and payments modernization, embedded finance, and open banking are the top five banking and fintech trends for 2022.

Source: Forbes

Other Key Fintech Developments:

• Coinbase intros DeFi products. COIN
• Healthcare.com added $180M. 
• PlayNFT taps Enjin’s DLT tech.
• Fuse added a $25M extension.
• FTX, Ledger solving dilemmas.
• Celo adding Polkastarter IDOs.
• Robinhood added Chainalysis. HOOD
• Nium et al eye travel payments.
• Binance shuts down Singapore.
• BBVA adding to its crypto offer. BBVA
• APImetrics, Finextra offer data.
• Solvento raised a $4.5M round.
• Justin Kan intros a NFT market.
• Blockchain.com to raise $400M.
• OakNorth to buy fintech Fluidly.
• HSBC, Wells finish a PvP settle. HSBC WFC
• Equifax unveiled new products. EFX
• Current, MrBeast giving money.
• Euler announces new launches.
• RBA reports on CBDC project.
• October has added new round.

Watch Out For This: Democratic Senator Elizabeth Warren said the Internal Revenue Service should “commit right now” to rolling out free online tax filing for Americans.

Source: Bloomberg

Interesting Reads:

• Expected returns next 10 years.
• BoE called for crypto regulations.
• Exchanges planning innovation.
• Nike buys virtual sneaker maker. NKE
• Amazon rethinking a phone ban. AMZN

Market Moving Headline: So much pointless conjecture with respect to Federal Reserve policy evolution and COVID-19, this week.

You can’t say the market definitively rose alongside COVID-19 optimism and then allude to the market falling on pessimism around COVID-19 in the next trading session. That is dumb.

Rarely will news organizations (other than Benzinga) come out to discuss the implications of customer positioning and how that ultimately affects underlying price action.

For instance, why is the S&P pinning against $4,700.00? Probably because customers are committing bets on low volatility into FOMC and Friday’s large derivatives expiry. If customers are selling (buying) calls (puts), the counterparty is then buying (selling) calls (puts).

In hedging their rising (declining) long-delta exposure, the counterparty will sell (buy) stock/futures into strength (weakness). This forces the market into a consolidation.

This trend ought to continue until (A) there’s a collapse in event-related implied volatility which would bring in positive flows as dealers cover static hedges, (B) poor breadth and single-stock weakness feeds into feverishly destabilizing demand for downside protection, or (C) participants commit more capital to calls further out in time and higher in price.

Here’s one Benzinga article unpacking some of this. Moral of the story, Benzinga > everyone!!!

Source: Benzinga