• Nicholas Merten says Bitcoin is facing a make-or-break moment this week ahead of the release of the CPI report.
• Circle CEO says traditional finance institutions feel threatened by the idea of full reserve banking systems.

Famous YouTuber and crypto analyst Nicholas Merten suggested that the release of the consumer price index (CPI) report later this week would have a massive effect on Bitcoin’s price. In his latest video, Merten told his over 500,000 subscribers that this week is a make-or-break period for the leading digital asset. He remarked that the previous CPI report caused Bitcoin’s price to drop by about 10 percent within 24 hours.

The CPI report release is an important event because it has significantly impacted Bitcoin’s price in the past. Also, the crypto market (including Bitcoin) and the entire stock market are trading around their lows during this bearish season. However, a positive surprise in the CPI report might lead to bullish financial markets. But, if the reverse is the case, then crypto and stock prices might drag down to lower levels.

Merten claims that technical indicators suggest another bearishness for Bitcoin, with a further price drop. The YouTuber added that it is unlikely that the Fed will change its hawkish stance till inflation drops significantly and there is a weakening or softening in the labor market.

He said the Fed would only change its hawkish stance when inflation reaches a 2 percent annualized target, which is their key target. Merten added that the Fed would also want to see a weakening trend in the labor market (lower amounts of job openings).

A full-reserve banking system threatens traditional financial institutions – Jeremy Allaire

Meanwhile, Circle CEO Jeremy Allaire has said that JPMorgan and other traditional financial institutions feel threatened by the idea of a full reserve banking system. Allaire made these claims in a recent interview with Kevin O’Leary, the shark tank investor. He further said that the banks’ system for moving and tracking money is antiquated and less efficient than blockchain technology.

According to him, blockchain infrastructure is more open, publicly available, auditable, real-time, accessible, and transparent. Allaire claims that big financial institutions like JPMorgan are yet to embrace stablecoins and blockchain technology because it’s a threat to them.

The Circle CEO explains that a payment stablecoin is like short-term us government treasury bonds and cash at the Fed reserve. He also said stablecoins could be regarded as the safest digital dollar worldwide. In contrast, a deposit at any commercial bank like JPMorgan is a loan to the bank, which they can use to make more money through lending.

Allaire added that a full reserve dollar payment and banking system is an idea whose time has come. However, traditional institutions feel threatened because they base their payment systems on fractional-reserve lending. In August 2021, Circle (the company behind the USDC stablecoin) disclosed plans to become a full reserve commercial bank under agencies controlled by the US Treasury Department and the Federal reserve.