Biden Crypto Regulation Coming

Today is Friday, February 18, 2022.

New to this newsletter? Sign up here.

Biden Crypto Regulation Coming, Report Says

President Biden will likely submit an executive order next week directing government agencies to study cryptocurrencies and to develop a strategy to regulate digital assets, according to Yahoo! Finance on Thursday.

Going Digital: The order will also include a study into the creation of a Central Bank Digital Currency (CBDC), which is a digital form of a country’s fiat currency. The U.S. Federal Reserve is already looking into this.

Details: The study will also examine financial stability issues, privacy issues, digital distributed ledger technology, coordination with other governments, and measures to protect people from crypto-related risks.

The Good: Proponents say that the federal regulation of crypto is good because it will legitimize crypto and it will protect users from scams.

The Bad: Opponents say that the federal regulation of crypto is bad because it could inhibit innovation and drive down crypto prices.

Final Thoughts: Even without regulation now, crypto prices have been down this year, mirroring the broader market.

Notables

Notable Earnings Today: DraftKings (Nasdaq: DKNG), Deere & Co. (NYSE: DE), Bloomin' Brands (Nasdaq: BLMN), AdvanSix (NYSE: ASIX), Barnes Group (NYSE: B), PPL Corp. (NYSE: PPL), Arbor Realty Trust (NYSE: ABR), Balchem (Nasdaq: BCPC).

Notable IPOs Today: Blue Water Vaccines, Inc. Common Stock (Nasdaq: BWV), PowerUp Acquisition Corp. Unit (Nasdaq: PWUPU), FG Merger Corp. Unit (Nasdaq: FGMCU).

Notable Equity Crowdfunding Campaigns Ending Today: Sizigi (Wefunder), Monogram Orthopaedic (StartEngine), YEP (NetCapital), Harmony Turbines (Wefunder), Dragon Spirits Marketing (Wefunder), Cassava San Francisco (Wefunder), myEDmeds (Wefunder), SunState Laboratories (Wefunder), GapNurse (PicMii).

Notable Economic Events Today: Existing home sales (10:00 a.m. ET).

Roku Earnings Hit by Supply Chain Disruptions

Shares of Roku (Nasdaq: ROKU) dropped 22.36% in after-hours trading on Thursday after the video streaming company posted mixed earnings.

Financials: Roku reported earnings of 17 cents per share, which was better than expected. But its revenue of $865 million missed expectations.

Supply Chain: Growth rates slowed in the second half of the year, which Roku attributed to global supply chain disruptions. Certain advertiser categories were also impacted due to supply chain challenges.

Outlook: Roku expects to hit $720 million in revenue in the first quarter, which is below estimates. The company expects ongoing supply chain disruptions in the quarter.

The Good: Platform revenue grew 80% and gross profit jumped 74%.

Final Thoughts: Roku’s stock is down 68% in the past 12 months.

Treasuries in Focus Amid Conflict

Those investing in U.S. Treasuries may be concerned about the latest news from the Russia-Ukraine conflict.

Recent History: Treasury yields dropped last Friday after the White House said that there were signs of Russian escalation. The 10-year Treasury note fell to 1.92%.

Background: Usually during conflicts, Treasuries are a popular choice for investors who face a difficult future.

Final Thoughts: Last week, the 10-year Treasury yield hit 2% for the first time since 2019.

Trends to Watch

Down: Meta Platforms drops out of top 10 companies by value, with new 4% dip (Seeking Alpha)

Undercooked: Shake Shack forecasts slim sales as Omicron surge hurts (CNBC)

Positive: Goldman Offers Bright Outlook for Post-Pandemic Wall Street (The Wall Street Journal)

Expansion: SEC Report Shows Why Accredited Investor Definition Should be Adjusted to Provide Access to More Investors (Crowdfund Insider)

Falling: Bitcoin bulls scramble to defend $40,000 as the crypto market sell-off intensifies (Cointelegraph)

Thank you for reading!

Forward to a friend and tell them to sign up here.

Want more investing tips? Listen to the podcast.

Questions or comments? Hit reply to reach out.