Welcome to our #77 weekly newsletter.
“For women taking control of their financial future”
-Jana Hlistova
From The Purse
In this week’s newsletter, we focus on women investing in crypto and why we need more women in the blockchain and crypto industry.
Read the explainer on why the global stock markets continue to rise despite the global pandemic.
You can review the news in brief so you stay on top of global financial, economic and investing trends.
And don’t forget to listen to The Purse Podcast with Bridget Greenwood, the Founder of The Bigger Pie. We talk about blockchain, crypto and DeFi (decentralised finance), gender diversity in blockchain and crypto.
Stay safe everyone & look after yourselves.
I hope you enjoy this week’s newsletter.
Until next week,
Jana
Women are investing in crypto
But we still need more women in the blockchain and crypto industry
The world of investing is still considered (wrongly) a male domain. And whilst the same can be said for investing in crypto, recent data suggests that this is changing.
Women invest in crypto
Research published earlier this year by Gemini (UK) suggests that investing in crypto is becoming more diverse, and specifically women are engaging as investors.
Here are the key data points:
Out of the 13.5% of 2,000 respondents that are current or previous cryptocurrency investors:
41.6% were women
Of the 9% that are planning to invest, 40% were women
This represents a ‘significant shift’ where women made up ‘just’ 21%–22% of crypto investors.
Men tended to hold more cryptocurrency than women in categories:
over £10,000/$13,694 (65.8%)
and below £500/$685 (62.1%)
Women made up 53.4% of those holding £1,000–£5,000 ($1,369–$6,847).
However, a report published by Etoro (a trading platform) in February of this year, said that women represent only 15% of bitcoin traders. But the percentage of women holding Bitcoin on its platform increased from just 10% a year ago.
Since the start of the pandemic..
…there has been a surge in retail investing, after the global stock markets plummeted (March 2020) but bounced back because of government stimulus.
Online trading platforms make investing far more accessible often charging ‘zero fees’. It has never been as easy to invest (in theory) in Tesla, Bitcoin and meme stocks like Gamestop.
In an interview with…
…Gretchen Howard, the Chief Operating Officer of Robinhood (the US trading app) said that she has seen significant growth in the number of women customers in the last 2 years. This is a 369% increase year-on-year.
The platform reported in March that 40% of its active female customers were trading crypto, a seven-fold increase over 2020.
The blockchain and crypto industry
However women continue to be underrepresented in the blockchain and crypto industry. It is estimated that women represent no more than 29% in the blockchain and crypto industry (and this is considered a generous estimate).
Women-led events and women-led communities
Role models and women’s communities are vital to increasing female involvement and representation in the blockchain and crypto industry.
Sharing learnings and experiences is often a powerful way for women to learn and engage.
Bridget Greenwood, the Founder of The Bigger Pie encourages women to join a women’s community regardless of whether women have a technical background or not.
Often women with experience, have many transferable skills which can be applied in the blockchain and crypto industry. And the rest can be learnt.
What next?
Listen to The Purse Podcast interview with Bridget Greenwood talking about blockchain, crypto and DeFi. And how more women can engage in the industry.
News in Brief
Financial news
US Treasury yields plunged as low as 1.25% this week, compared with a peak above 1.7% at the end of March. Markets have come to the view that the global economic rebound will soon decelerate, and the Fed will not lose control of deflation.
UK economy expanded by 0.8% in May, much weaker than the 1.5% growth expected (and remains 3.1% below its pre-pandemic peak).
The European Central Bank (ECB) shifts inflation target from ‘below 2%’ to towards a 2% target. German politicians concerned that printing billions of extra euros this year will spark an inflationary spiral.
UK house prices fell in June: price of average home slipped by 0.5% in June to £260,358 but still 8.8% higher than a year ago.
British fintech Wise valued at nearly £9bn after record London direct listing. Wise opted for a direct listing meaning the company began trading on Wednesday without raising any money.
Crypto: bitcoin, ethereum & DeFi
On Thursday, Bitcoin fell 7% to $32,639 amid a broader cryptocurrency sell-off that has also dragged crypto-linked stocks lower. Ether was down 10.0% to $2,149.15. See Bitcoin price & Ether price today.
Bitcoin’s transaction fees sink to 2020 prices as bull run wanes. The average transaction fee on Bitcoin is $3.92 (Saturday), indicating a steep drop off from this year’s all-time high of $62.78, set on April 21.
Bitcoin’s hash rate (the computing power used to mine new blocks) has fallen 50% from its peak in May. The main cause for the falling hash rate is the crackdown on bitcoin mining in China. The number of daily transactions has also fallen.
Ether could become the dominant store of value, because of its real use cases, according to a Goldman Sachs note. That means ether could eventually overtake bitcoin as the top cryptocurrency.
Cryptocurrency firm Circle, the issuer of the USDC stablecoin, will go public via a SPAC.
Jack Dorsey’s Square to commits to building a Bitcoin hardware wallet.
Apple Co-Founder Steve Wozniak, says that Bitcoin is a mathematical miracle.
New Coindesk research shows that the DeFi market is not slowing down. Decentralised Finance (DeFi) is proving to be the great differentiator between bitcoin and ether. ‘One of the things that will be interesting to watch in the upcoming quarter is the makeup of crypto assets locked in DeFi..’
Explainer: why are global stock markets at record highs?
Stock markets continue to rise during a global pandemic. Why?
Global stock markets are at a record high.
The MSCI All-Country World Index is already up 12% this year to an all-time high.
And as reported by Bloomberg, the likes of BlackRock, and State Street Global Markets expect equity markets to keep on rising in the second half of this year.
But why are stock markets around the world hitting all-time highs during a global pandemic?
Rewind: central banks are ‘propping up’ the global stock markets
To limit the damage to the global and UK economy because of Covid-19, central banks have been printing money. This is also referred to as quantitative easing or QE.
In other words, central banks buy government and corporate bonds (from other financial companies and pension funds).
At the same time, central banks like the US Federal Reserve and the Bank of England (BoE) cut its Base Rate to 0% and 0.1% (respectively) in March 2020.
So whilst QE helps to pump liquidity into the markets, borrowing is cheap as the low Base Rate feeds into households and businesses (should in theory) spending more.
Low interest rates has also allowed the government to borrow money cheaply. They have provided fiscal programmes (for example, the furlough scheme or the Bounce-back Business Loan in the UK) which has helped households and businesses stay afloat.
And yes, government debt has skyrocketed during this time.
Investors are confident (sort of)
Vaccination is accelerating globally, the main central banks continue to print money, government support is still present and corporate earnings are bouncing back.
This coupled with pent up demand and global economies re-opening, within a low interest environment, means that investors are less cautious and are pouring money into equities (for a higher return).
Interest rates likely to stay at zero or close to zero (for now)
And for the time being, central banks have signalled that they will not increase interest rates (Base Rate) any time soon (likely in 2022+) Which means that borrowing continues to be cheap and consumer spending should (in theory), go up.
And profit expectations have bounced back…
…to pre-pandemic levels (globally). Investors see a recovery in earnings growth as vital to stock markets continuing to rise.
This outlook is expected to continue into 2022 and 2023.
But keep an eye on:
Rising inflation: is it temporary or permanent? Has the global economy recovered too fast? Markets have come to the view that the global economic rebound will soon decelerate.
Investors need to hedge against inflation. Purchase assets where the rate of return (on assets, like equities) is greater than inflation (note: the rate of inflation relates to where you spend your money, and is likely to be higher than the reported CPI figure of 2.1% in the UK).
New Covid variants pose a threat to the global recovery.
Market volatility: it is highly likely but also a good time to ‘buy the dip’. However, some expect a ‘market crash’ is coming (no one knows when this will be).
***
Listen: to the podcast interview with Shaun Richards about the impact of the pandemic on the global and UK economy.
The Purse Podcast
Blockchain, crypto and DeFi (decentralised finance) and the women innovating
We cover the following in our conversation:
Women-led communities in blockchain
What is blockchain, DeFi and why should we care?
Why is this space so hot right now?
Senior women and gender diversity in tech
Blockchain projects led by women (from The Bigger Pie community)
The 200bn Club
Coffee Break? Read This
Why inclusive leaders are good for organisations and how to become one
Twice as many City women as men suffer ‘extreme’ stress during the pandemic
We’d love to hear from you. Get in touch with Jana via the The Purse website or tweet @jointhepurse and @janicka.
The Purse Ltd. Copyright 2021 & All Rights Reserved.
The Purse provides content for informational purposes only, we do not recommend products or services or provide investment advice. Please do your own research or speak to a financial advisor.
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