Hey Snackers,
The end of an MP3 era: Apple has discontinued its last iPod in production, the iPod touch. Apple says not to fret because the “spirit of iPod” continues in its other products. RIP-od, joining HitClips in music-player heaven.
The market closed mixed after another roller-coaster day, swinging between green and red after Monday’s big sell-off. All eyes are on this morning’s inflation report for April, which could — maaaybe — show price hikes finally starting to slow.
Not so stable after all… Stablecoins are causing crypto chaos. Refresher: stablecoins are cryptocurrencies whose value is (theoretically) pegged to another asset, like the USD. But this week TerraUSD (UST), the third-largest stablecoin, was unpegged from its $1 value and fell to $0.62. Investors then sold UST (think: crypto bank run), sending jolts through the market.
Crypto’s confidence crisis… goes beyond stablecoins. The crypto market has lost nearly $2T in capitalization from its November peak. Even bitcoin is down 50% since then, which has led analysts to question its status as “reserve currency” for other coins like UST.
Most cryptos were minted in calm weather… Now they’re caught in the path of two storms: regulation and recession. UST’s “buck-breaking” moment showed that even so-called stable coins are risky, prompting Treasury Secretary Janet Yellen to call — again — for new crypto rules. Plus, economists predict a recession’s coming, which could cause un-tested coins like UST to lose more value. Investors may get caught in the rain: most short-term crypto investors are already underwater, and more than half of bitcoin holders are in the red.
Loanly, I'm Mr. Loanly... "Buy now, pay later" doesn’t sound as good as it used to. The days of near-zero interest rates and stimmy checks are gone, and it's hurting loan providers — from BNPL firms like Affirm to accessible lending platforms like Upstart.
Pay in installments?... Maybe nah. Lending boomed during the pandemic as extra-low interest rates made borrowing cheap — from home buying to online clothes shopping. BNPL firms like Afterpay, Klarna, and Affirm thrived by letting you buy those $700 Gucci loafers now and pay in installments later. Last year, Americans spent more than $20B through BNPL. Almost a year ago, Klarna hit a $46B valuation, becoming the second-most-valuable private fintech. Now:
When rates rise, BNPN wins… That’s “buy now, pay now.” Rising rates make loans more expensive — from credit-card debt to car leases — so consumers might start taking out fewer loans (hence: why Upstart slashed its forecast). Now the BNPL sector is being repriced to reflect that, and debt-laden Gen Zers are starting to turn against the services whose growth they fueled.
Authors of this Snacks own: bitcoin and shares of Apple, Tesla, Square, and Netflix
ID: 2196229