Archives for March 2021

The first such settlement in USDC – a stablecoin pegged to the US dollar at a 1:1 ratio and transacted over the Ethereum blockchain – was conducted earlier this month, Visa and its partner Crypto.com announced on Monday. The crypto platform sent USDC to Visa’s Ethereum address at digital asset bank Anchorage.

The move marks “a huge milestone for the industry as crypto and fiat networks begin to converge,” Visa’s partner Crypto.com said on Twitter.

Also on rt.com Bitcoin worth more than Visa Mastercard combined

“The announcement today marks a major milestone in our ability to address the needs of fintechs managing their business in a stablecoin or cryptocurrency, and it’s really an extension of what we do every day,” Jack Forestell, Visa’s executive vice president and chief product officer, said in statement.

Crypto going mainstream: Mastercard to allow payments in cryptocurrencies

Visa’s settlement process initially required Crypto.com to settle in a fiat currency, which could result in additional costs and complexity for businesses. The latest step would allow payments to be settled directly in USDC without converting the cryptocurrency into traditional money.

Visa plans to expand the program, offering USDC settlement capability to more partners later this year after additional tests and talks with clients, the company said. Work with stablecoins could further allow the payment provider to support sovereign digital currencies, known as Central Bank Digital Currencies (CBDC), as more and more countries are currently developing their own tokens.

The global payments giant and the crypto platform have been partners for several years. In 2018, they launched a Crypto.com Visa card, allowing users’ crypto to be converted into one of the supported fiat currencies.

Digital currencies have become more broadly accepted by the mainstream financial industry in recent months. Visa’s rival credit card giant Mastercard announced in February that it plans to allow payments in certain cryptocurrencies on its network this year. Payments companies Square and PayPal have also backed cryptocurrencies.

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“The response to Covid and to the financial aspects [of the crisis] has been fragmented, and geopolitical divides are not helping,” Guterres said, adding “It has been too limited in scope and too late.” 

According to him, the fact that only six countries defaulted on their foreign debts last year – Argentina, Belize, Ecuador, Lebanon, Suriname and Zambia – created the “illusion” of stability and a “misperception of the seriousness of the situation.” 

The UN chief pointed out that large, middle-income developing countries such as Brazil and South Africa had borrowed heavily from domestic lenders rather than from foreign investors, at interest rates much higher than those available to rich countries. This makes the dangers less visible than in previous emerging market debt crises, he said. 

Also on rt.com Countries around the world spent over $13 TRILLION to combat Covid-19 pandemic – report

In failing to address debt sustainability, “the risk is that we compromise the recovery of the economies of the developing world with catastrophic consequences for people’s lives, with an increase in hunger and poverty and dramatic problems with health and education systems, in many cases leading to instability, social unrest and, at the limit, conflict. Everything is now interlinked,” said Guterres.

READ MORE: Covid pandemic could push more than a BILLION people worldwide into extreme poverty, UN warns

According to the World Bank estimates, around 120 million people have been pushed into poverty by the Covid-19 crisis, with the majority of the “new poor” in middle-income countries. The UN previously warned that over 200 million people could be driven into extreme poverty by the severe long-term impact of the coronavirus pandemic, bringing the total number to more than one billion by 2030.

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International benchmark Brent fell 2.1% to $63.19 a barrel while US West Texas Intermediate dropped 2.4% to $59.49 per barrel. 

The stranded ‘Ever Given’ ship was successfully refloated on March 29 and was being secured, a global provider of marine services, Inchcape Shipping, said on Twitter.

The breakthrough came after intensive efforts that saw 10 tugboats work to push and pull the ship as several dredgers vacuumed up the sand at spring tide. It’s still unclear when the canal will reopen for traffic now that the vessel has been dislodged, Inchcape Shipping added.

The 224,000-ton container has been stuck and clogging up the waterway since Tuesday last week after it lost the ability to steer amid massive winds and a sandstorm. The incident caused the temporary suspension of navigation in the Suez Canal, delaying hundreds of other container ships, bulk carriers and oil-laden tankers.

Oil prices have swung wildly since then as traders and investors tried to weigh the impact of the blockage of the trade transit point. According to a senior market analyst at OANDA, Jeffrey Halley, oil market volatility is set to continue.

“Given the volatility last week, Brent looks set to move to the lower end of its $60.00 to $65.00 a barrel range,” he said as quoted by Reuters. US oil is “likely to drop to the lower side of its $57.50 to $62.50 a barrel weekly range.”

Also on rt.com Why blockage of Suez Canal could have rollover effect on oil price

Analysts say that prices are getting some support from expectations that the Organization of the Petroleum Exporting Countries (OPEC) and its allies will maintain lower output levels when they meet this week.

“With the Suez and OPEC+ uncertainties on top of a foggy demand picture, we may see big mood swings and high intraday volatility,” Vandana Hari, founder of consultancy Vanda Insights, told Bloomberg, adding, “I don’t see how OPEC+, or the Saudis, could risk putting more oil into the market after the downward pressure on crude of the past fortnight.”

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“Venezuela has the oil vessels and has the customers who will buy our oil,” Maduro said, as cited by the media. “We are ready and prepared for oil for vaccines, but we will not beg anyone.”

He added that in addition to oil shipments, Caracas could pay for the vaccine provided through the COVAX initiative – which aims to provide vaccines for poor countries – with the money “kidnapped” from the country, referring to the funds frozen in overseas accounts due to sweeping sanctions. 

Also on rt.com US sells over a million barrels of seized Iranian fuel headed for Venezuela

Last week, Vice President Delcy Rodriguez said that about $7 billion of the country’s funds remain blocked on foreign bank accounts in addition to other assets and demanded them to be released. Previously, Venezuela battled to win back control of $1 billion in gold held in the Bank of England’s reserves, while the country’s Western-backed opposition also laid claim to the bullion stockpile. London has been withholding the funds despite Caracas wanting to use them to battle the Covid-19 outbreak.

Venezuela has seen a spike in coronavirus infections, reporting the most daily cases in months on March 21, according to World Health Organization (WHO) data. Nearly 155,000 cases were registered in the country, while 1,543 people died. 

Also on rt.com Venezuela signs deal with Russia to purchase 10 million Sputnik V vaccines for FREE distribution

Earlier this month, Venezuela refused to authorize AstraZeneca’s Covid-19 vaccine over reports of side effects. Those vaccines were set aside for the country under the global COVAX plan but were not released due to Venezuela’s debt to the WHO, according to AFP.

The country has so far approved Russia’s Sputnik V and China’s Sinopharm jabs for its Covid-19 immunization efforts. In October, Venezuela became the first nation in the Western hemisphere to participate in the trial of Russia’s vaccine. At the end of 2020, Caracas and Moscow signed a deal to procure 10 million Sputnik V doses and the Venezuela started to vaccinate with it in February.

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Grain supplies increased 1.7 times to $2.517 billion, while fish and seafood sales dropped by 28% to just $683 million. Deliveries of fat-and-oil products surged by 25.8%, rising to $1.287 billion. Statistics also showed that food exports decreased more than six percent to $605 million. Meanwhile, sales of meat and dairy products grew 17.1% to $205 million.

Turkey was the major consumer of Russian agricultural products, increasing its imports this year by 46.8% to $991 million. At the moment, the country has overtaken China in terms of purchases of Russian products. The country’s share in the total volume of shipments of agricultural products from Russia is 16.1%.

Also on rt.com World facing unprecedented threat of food shortages, UN agency warns

China, the second-largest consumer, ramped up purchases of Russian products by 13.3% to $963 million. It now accounts for 15.6% of Russia’s overall agricultural sales.

Russian exports to the EU countries increased by 7.4% and currently stand at $678 million. The top 10 importers of Russian agricultural products also include Egypt, South Korea, Azerbaijan, Ukraine, Kazakhstan, Uzbekistan and Pakistan.

According to the ministry, the total value of Russia’s agricultural exports amounted to $30.658 billion in 2020.

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The Ever Given, which has been stuck in the canal since Tuesday, created a backlog of nearly 370 vessels, including 25 oil tankers, Osama Rabie, head of the Suez Canal Authority, told Al Arabiya on Sunday. He added that the authority is working to meet the logistical needs of the stuck vessels and may provide discounts for them. Rabie did not elaborate on the details of the initiative, and it is unclear which ships would qualify for it. 

The blockage costs the canal $13-14 million in lost revenue daily, he said.

Also on rt.com Shutoffs at world’s major trade routes evolving as Europe’s busiest freight line remains closed cargo still stuck in Egypt

The operation to free one of the world’s biggest container ships made some progress over the weekend. More than 20,000 tons of sand and mud were removed, allowing the Ever Given’s bow and stern to be loosened. The rescue operation continued on Sunday, but it is still unclear when traffic through the Suez Canal will fully resume. Some carriers have already diverted their ships from the waterway to avoid the gridlock.

However, the authorities are bracing for the worst. Egyptian President Abdel Fattah el-Sisi ordered that preparations be made to remove some of the ship’s cargo to help refloat it, Rabie said. It was initially hoped that this type of operation could be avoided, at it would require more time.

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Goldman Sachs alone liquidated $10.5 billion worth of stocks in block trades on Friday, Bloomberg reported citing the investment bank’s email to clients. The first batch, that included $6.6 billion worth of shares of Baidu, Tencent Music Entertainment Group and Vipshop Holdings, was sold before the market opened on Friday. Later that day, the bank reportedly managed the sale of $3.9 billion worth of shares in American media conglomerates ViacomCBS and Discovery, as well some other companies, such as Farfetch, iQiyi and GSX Techedu. 

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Another US investment bank involved in the block trades, which are believed to have wiped $35 billion off affected firms’ valuations in just one day, was Morgan Stanley. The investment bank offered two batches of shares worth $4 billion each on Friday, according to the Financial Times. 

While block trades, when sellers are looking for buyers for large volumes of securities at a price sometimes negotiated privately between the two parties, are a common thing, the scale of Friday’s moves raised eyebrows. 

Musk loses $27 billion in days as high-flying tech stocks take a beating

“I’ve never seen something of this magnitude in my 25-year career,” portfolio manager at Swiss-based Bellevue Asset Management AG, Michel Keusch, told Bloomberg. 

Senior vice president at Wealthspire Advisors, Oliver Pursche, called the move “highly unusual,” adding that the market participants are now wondering if another wave of block trades could hit the market on Monday and Tuesday, causing wild price swings in the affected stocks.

Another issue is the unclear nature of those trades. Goldman Sachs explained the sales with “forced deleveraging,” the Financial Times wrote citing people with knowledge of the matter. The outlet also said that the move could indicate that a big hedge fund or family office faced some serious problems. 

Meanwhile, CNBC reported the selling pressure in some US media and Chinese stocks was linked to the forced liquidation of positions held by family investment office Archegos Capital Management. The lack of details about the move makes the situation worrisome, Pursche said, as investors don’t know “whether this was the liquidation of just one fund or more than a fund, or whether it was a fund liquidation to begin with and the reason behind it.”

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