In the end, buying it for the image of a blue cartoon cat didn’t cost millions. But it was much more expensive than I expected. Why? Taxes. Fees for the purchase of cryptocurrency ether, for transferring it to my cryptocurrency wallet and for making a purchase, which included an attractive mining fee due to the congestion in the network.
For my father’s sake, I’ll be the mother of how much I finally spent. I will say, given that the fees cost more than the NFT itself, it was more than I would normally recommend for a quick laugh.
Because I spend most of my time writing about finance, the episode also made me wonder: Between volatility and high trading costs, do cryptocurrencies really have a future as a broad means of spending?
But even after addressing the added costs, the massive rise in prices of popular cryptocurrencies such as bitcoin and ether may make people hesitate to part with them.
“I don’t think people look at it from an expense perspective. People see it as an investment yet,” Eleesa Dadiani, an art dealer and crypto broker in London, told me.
“Why would you want to spend a valuable asset on a depreciated product? It doesn’t make sense,” she said.
Bill Zielke, the marketing director of BitPay, which performs cryptographic transactions between companies and consumers, agrees that fees remain a barrier. But there are many innovations that could solve such problems, he said.
“I think the industry is very aware that taxes are something that needs to be addressed so that we can continue to see growth,” Zielke told me.
In terms of volatility, Zielke notes that customers can cover their bets by holding multiple cryptocurrencies or liquidating part of their portfolio at an appropriate time.
He acknowledged that there are still a lot of people in the crypto community who want to keep their coins – or HODL, in the language of the industry – as they grow in value.
But as bitcoin, ether, and even dogecoin gain steam, Zielke said interest in translating earnings into luxury purchases, from boats and watches to homes and planes, has grown. That makes him optimistic about the future.
“As consumers continue to use HODL and this balance continues to grow, at some point they will … use and spend it,” he said. – And we want to be there.
Human rights clashes complicate business in China
Tensions in Xinjiang – where US, EU and UK authorities have accused the Chinese government of cracking down on Uighurs and other minority groups through forced labor, mass detention and sterilization – have captivated a growing number of businesses and trade relations in recent months, CNN Business colleagues Jill Disis and Selina Wang report.
Beijing has vehemently denied all allegations and says its camps in the region are “vocational training centers” designed to combat terrorism and religious extremism.
But late last month, a benchmark investment agreement between the European Union and China was called into question after officials shifted sanctions on Xinjiang.
“We are working with our colleagues in China to do everything we can to manage the current challenges and find a way forward,” H&M said in a statement on Wednesday.
Beijing has made it clear that multinational corporations must abide by its rules if they want to operate in the country, and gaining favoritism may require anything from complying with restrictive regulations to saying good words about China. Many companies have traditionally been willing to gamble, given how attractive the gigantic economy is as a market for everything from cars and clothes to movies and luxury items.
But the growing political comeback can make some of these relationships unintentional, especially as lawmakers and investors step up pressure on Western companies to examine their supply chains to highlight human rights abuses.
“These companies are just right in the middle and there is no magic answer,” said James McGregor, president of consulting firm APCO Worldwide, China’s largest division. Read the full story here.
It follows
Monday: ISM non-manufacturing index
Tuesday: Reserve Bank of Australia policy decision; The economic perspective of the International Monetary Fund
Friday: China inflation data; US producer price index