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Illustration: Rebecca Zisser/Axios
The public markets' cryptocurrency hype is no more and it's losing votes of confidence from Wall Street, Axios' Courtenay Brown writes.
Driving the news: The Cboe will no longer support bitcoin futures trading after June, despite being the first exchange to pioneer the bitcoin-futures market in late 2017.
The big picture: News that Wall Street and traditional banks were buying into the digital currency phenomenon was seen as validation and drove crypto prices higher. However, things look to have turned.
Dion's thought bubble: Crypto began as something of a counter-cultural current and Wall Street jumped on the bandwagon when it rose to a pop culture phenomenon, pushing prices higher. Those days are over now.
Crypto will live or die based on whether or not a sustainable use case can be found for it. There are a number of ongoing experiments:
But if nothing catches on in a big way soon, crypto may be out of lifelines.
Financial analyst Wolf Richter points out that even without the Cboe, bitcoin futures trading isn't dead yet.
Bitcoin has managed to hold near the important $4,000 per coin level and CME Group, which still offers bitcoin trading, has seen higher trading volumes than Cboe. CME reps told CoinDesk that it has "no changes to announce re our bitcoin futures contract."
The S&P 500 lost $1.5 trillion in collective market cap since the beginning of last year, according to recent analysis by research firm GlobalData, Courtenay writes.
Interestingly, tech still dominates the S&P by a wide margin, despite losing $90 billion in market cap.
Go deeper: Big Tech's hold on the market might not last
There's no such thing as a reliable set of counterfeiting statistics. But the best that we have comes from the OECD, which released an 88-page report yesterday on "Trends in Trade in Counterfeit and Pirated Goods," Axios' Felix Salmon writes.
The report updates the OECD's data to 2016; previously, data only went up to 2013. Among the report's findings:
The bottom line: According to every counterfeiting report, the amount of trade in fakes is a direct function of the amount of international trade overall. The decline in trade from 2014 to 2016 resulted in a concomitant decline in the maximum value of the international counterfeit economy, from $623 billion to $509 billion.
When GDP became the dominant measure of economies in the 1940s, wide adoption of the internet was still a half-century away. Today, the internet is responsible for a major chunk of economic activity, but GDP misses much of it. This has widened the gap between the closely watched metric and actual economic health, Axios' Kaveh Waddell writes.
A global effort reaching back decades is picking up steam to either change or supplement GDP as the go-to gauge for understanding a country's — and the world's — level of prosperity.
Why it matters: The problem with GDP is not merely academic — reliance on the economic benchmark deserves part of the blame for the 2008 financial crisis, according to a 2009 report from a commission led by Nobel laureate Joseph Stiglitz. If economists had been watching other metrics, too, like indebtedness, they would have had an earlier warning of trouble ahead, the commission wrote.
The latest proposal comes from a group of economists led by MIT's Erik Brynjolfsson. In a forthcoming working paper, they propose a measure called GDP-B, adding in the benefits of free digital goods and new technology.
They estimate that hidden benefits from Facebook alone have added 0.05–0.11 percentage points to GDP every year since its 2004 launch. That would have totaled 1.54 percentage points from 2003 to 2017 — a result "too large to be ignored," according to University of Maryland's Charles Hulten, who was not involved in this research.
What's next: GDP has solidly remained ubiquitous despite its critics, but Hulten, who advises the Bureau of Economic Analysis, says the body is again considering alternatives. "Agencies are very aware of the need to change," he says, but are burdened with a busy schedule — plus many decades of inertia.