Blockchain-Enabled SIM Card For Crypto Investors Drives Conflux Growth; Bitcoin BTC price hovers near $27.3K after Fed decision

A hopeful day ends with a downturn

The U.S. central bank took the apparent path of least resistance, raising interest rates by 25 basis points to stem investor hopes that it would become more dovish in the wake of a banking crisis that has shaken confidence in traditional financial services and the strength of the U.S. dollar.

Bitcoin rallied in the immediate aftermath of the bank’s decision before edging steadily lower, even below $27,000. The largest cryptocurrency by market capitalization recently traded at $27,375, down 3.5%. Earlier in the day, as markets hoped for an end to the year-long regime of Fed rate hikes, BTC zoomed above $28,700.

“Risk aversion was able to drag Bitcoin down as market turmoil returned on banking concerns and over a rapidly weakening economy,” Edward Moya, senior market analyst for forex market maker Oanda, wrote in an email. “The Fed may be done tightening, but the risk of something else breaking in the financial sector remains high.”

Ether also fell from highs above $1,800 to its recent $1,737. The second largest crypto by market cap was down by 3.3%. Almost every other major crypto by market capitalization in the CoinDesk top 25 was well in the red with the key exceptions being APT, the token of tier 1 blockchain Aptos, and LTC, the parent crypto of open source blockchain Litecoin. They rose above 5% and 6% respectively. The CoinDesk Market Index, a measure of the crypto market’s overall performance, was recently down 2.7%.

The crypto world, meanwhile, received its latest shocks with the US Securities and Exchange Commission (SEC) warning crypto exchange Coinbase that it was pursuing enforcement action over securities violations and suing Tron founder Justin Sun on allegations of selling and airdropping unregistered securities, fraud and market manipulation. Tron was recently down 10%.

Oandas Moya called the allegations against Sun “newsworthy”. “Market manipulation is a part of the crypto world that has yet to be cleaned up or even close to being addressed,” he wrote.

Everything you might want to know about Conflux’s Blockchain SIM card

Tokens of Conflux blockchain has been one of the best performers this year, rising 1,700% since January 1st – from 2 cents to over 40 cents – quickly reaching a market cap of over $800 million.

Its growth has mainly stemmed from Coinflux’s deep roots in China and a blockchain-enabled SIM (BSIM) card touted as a unique entryway for everyday users to interact with cryptocurrency-based applications.

These will be built in partnership with China Telecom, the second largest wireless operator in China with an estimated 390 million subscribers, as CoinDesk has reported. China Telecom will launch the first BSIM pilot program in Hong Kong later this year, Conflux Network said at the time. This is likely to be followed by pilots in key locations in China such as Shanghai. The BSIM card will manage and store the user’s public and private keys on the card and perform digital signatures in such a way that the private key does not leave the card. Users who switch to a BSIM card will be able to store digital assets securely, transfer their digital assets easily and display their assets in a variety of applications.CoinDesk spoke with Ming Wu, Conflux’s Chief Technology Officer, to understand more about BSIM, Conflux’s future plans, how the card is different from a crypto wallet and the disadvantages of using BSIM.

CoinDesk: How does the BSIM card work, and how does it differ from a standard SIM card?

Ming: The BSIM card essentially integrates the hardware cryptowallet functionality into the SIM card. It can manage and store users’ public and private keys in the card and perform digital signatures in a way that keeps the private key from leaving the card. The BSIM card can also allow encrypted storage and key retrieval. The BSIM card has more than 10 times the storage capacity and computing power of a traditional SIM card.

CD: How does the BSIM “lower the barrier to entry” for metaverse applications?

Ming: Today, there are a large number of users of the SIM card. Most of them are users in the traditional world and outside the Web3 world. They are all potential users who can be converted to Web3 users with the upgrade to the BSIM card. We are developing a mobile app that encapsulates access to the BSIM card that will help these users manage their digital assets based on their traditional habit and without the requirement of knowledge about the crypto keys. This will make it easy for them to take part in the activities in Web3 and Metaverse. Meanwhile, for the original crypto users, the BSIM card makes accessing the hardware wallet much more convenient. It provides a good balance between security and convenience for users. So it will also be very attractive to these crypto users.

CD: What are the main advantages of BSIM versus a crypto wallet?

Ming: The biggest advantage of BSIM card is that it provides the security of hardware cold wallet and also the convenience and portability at the same time. Users can achieve very high security for their wallet simply by equipping their mobile phone with the BSIM card. And this will not break their normal user experiences of the phone.

CD: What are the potential downsides of BSIM?

Ming: It will be a slight inconvenience for some users who are very concerned about their privacy. In some regions, especially in mainland China, the BSIM card must be acquired with KYC so that your mobile phone number can be linked to your public key account. From another perspective, this may not be a weak point because this makes the way of using such crypto wallets more compatible in China, so it becomes easier to get support from the Chinese government. And this also makes it possible to link users’ on-chain information in the virtual world with a bunch of off-chain information in the real world, uniting the Metaverse and the real universe.

CD: What are the timelines for product development? When do you expect to have a prototype to test in Hong Kong?

Ming: We have built prototype chips and tested them on the Conflux network. Feasibility has been verified. We plan the volume production together with our China Telecom partner. We expect to launch production in Hong Kong this year.

With policy changes, increased support for blockchain technology and Justin Sun moving cryptocurrency exchange Huobi’s Asia headquarters from Singapore to Hong Kong, Hong Kong has a very friendly policy towards the crypto industry. And it has more and closer connections to mainland China. It has an appropriate role as a bridge connecting the Web3 industry in China to the wider global market.

CD: What will Conflux’s role be in this growth?

Ming: Conflux is the only regulatory blockchain in China. It has solid technical design, implementation and maintenance supported by a world-class team with strong technical expertise. So Conflux will naturally take the leading role in helping Hong Kong and Mainland China carry out their expansions in the Web3 space.

Bitcoin continues to trade around $28,000 as crypto investors await the Federal Reserve’s interest rate announcement. Analysts expect the US central bank to raise interest rates by a quarter point, according to the CME FedWatch tool. eToro investment analyst Callie Cox and Matrixport’s head of research and strategy Markus Thielen joined the conversation.