First Mover Asia: Cryptos Slide in Weekend Trading; Did Ethereum Pick the Wrong Time to Merge?

Investor euphoria about last week’s technological transformation of the Ethereum blockchain seemed far gone as ether’s price on Sunday tumbled to its lowest level since late July. Equity markets revived somewhat from their Thursday thrashing with the Dow Jones Industrial Average , S&P 500 and tech-heavy Nasdaq all trading up a few fractions of a percentage point, although a looming U.S. railway strike could lead to additional inflation pressures. Officials from the Biden Administration and union and railway company representatives were meeting to try to avoid the work shutdown. “Yes to digital asset innovation, no to cryptocurrency speculation,” is how the director of the Monetary Authority of Singapore put it in a recent speech. Now, the central bank, in conjunction with the SEC, is set to get a complete regulatory toolkit as lawmakers prepare to debate a crypto framework in the nation’s parliament. There are 13 proposals for new crypto legislation waiting, CoinDesk previously reported, including the country’s upcoming digital asset framework, the Digital Asset Basic Act.

  • Many of the world’s Web3 projects are registered in Singapore, despite their presence in the city being little more than a post office box or a rented desk at a co-working space.
  • Those hits included FedEx’s announcement on Thursday that it would be closing offices amid concerns about a recession, looming Goldman Sachs job cuts and General Electric supply chain issues.
  • “The story about the macroeconomic environment is, if it allows consumers to have a larger budget – and certainly the COVID-19 environment was that – they’re more likely to take risks, they’re more likely to use Web3 and try new protocols,” he said.
  • “There is real concern that with higher interest rates, the U.S. economy will fall into recession, which is hurting risky assets,” he wrote.
  • In crypto news, financial services giant Fidelity is contemplating whether to let individual brokerage customers trade bitcoin , The Wall Street Journal reported, citing people familiar with the situation.

The septet of crypto entrepreneurs includes six newcomers to the list including three of its youngest members. The exact details of Singapore’s new crypto legislation are expected in the fall, probably around the time of the city’s Token2049 crypto conference. Perhaps part of the hostility regulators have towards crypto is that as a hub, Singapore’s institutions must work through crypto’s biggest problems. Singapore’s judicial system is tasked with helping clean up the mess left behind by Three Arrows Capital. Many of the world’s Web3 projects are registered in Singapore, despite their presence in the city being little more than a post office box or a rented desk at a co-working space.

First Mover Americas: Bitcoin Up 3% After Wild Ride on ‘Fed Rate Day’

This software bundles multiple off-chain transactions into a single layer 1 transaction, which helps reduce the data load, leading to faster network transactions at lower costs. In her remarks, Brainard also said the cryptocurrency market bears similar risks to traditional finance, but will need new regulations for situations crypto mining opportunities ramp up as bitcoin not covered by existing laws. Given the unique characteristics of crypto, there’s a need for “creating clear regulatory guardrails,” she said. Among other major altcoins, ALGO, the token of proof-of-stake, carbon-negative blockchain network Algorand, recently rose more than 6% after the company announced a protocol upgrade.

A surge Monday sent bitcoin over $22,000 for the first time in more than three weeks after the largest cryptocurrency by market capitalization spent the past three days comfortably above $21,000. In an interview on CoinDesk’s “First Mover” TV program, Lex Sokolin, head economist of decentralized protocols at software company ConsenSys, said that cryptocurrencies respond to external events similar to other riskier assets. “The story about the macroeconomic environment is, if it allows consumers to have a larger budget – and certainly the COVID-19 environment was that – they’re more likely to take risks, they’re more likely to use Web3 and try new protocols,” he said. “And if they’re compressed, and they’re much more worried about paying down their mortgages or their rents, they’re going to have less discretionary budget. And so that’s going to be damaging for crypto prices in the short term.” Earlier in the day, crypto exchange Huobi said that it would delist seven tokens, including monero and zcash.

Moya added that “this week’s central bank decision fireworks, which could help fuel any sell-offs to retest the summer lows. Peak pessimism is almost here for crypto, which is needed before longer-term money piles back in.” Balina is charged with conducting an unregistered securities offering in 2018 for his SPRK ICO token, but proving that the Ethereum network should be subject to U.S. securities law will be difficult; cryptos largely decline. In December the SEC filed a complaint alleging Ripple raised over $1.3 billion through an unregistered, ongoing digital asset securities offering. In his own tweet, former CFTC Chairman Christopher Giancarlo said the CFTC was the only agency with the experience to regulate cryptocurrency markets and pressed the CFTC to nominate a new chair to generate “sensible cryptocurrency regulation.”

Blockchain Means So Much More Than Crypto

Also joining “First Mover” was Raj Gokal, Solana Labs chief operating officer and Securitize founder and CEO Carlos Domingo. Ether, the second-biggest crypto in market value, followed a similar pattern and was changing hands under $1,600, a roughly 6% decline from a day earlier as inflation worries trumped Merge excitement. “Not only just cryptocurrencies but also all risk assets in general are being sold off in anticipation for the pending … worldwide recession,” Adam See, senior vice president and head of digital assets at Global X ETFs, told CoinDesk TV’s “First Mover” program. Bitcoin was recently trading at about $19,300, up more than 2% for this period after falling to $18,558 on Tuesday, its lowest level in two months.

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In February, Long Blockchain warned that it was facing the risk of being delisted since the SEC believed the firm “made a series of public statements designed to mislead investors and to take advantage of general investor interest in bitcoin and blockchain technology.” Most other major cryptos spent Sunday in dark red, with OP recently off 17% and RVN and YGG each down roughly 15%. KNC, the token of the Kyber Network, was down roughly 25% more than eight hours after discussion on Twitter about a possible exploit. The Merge is also unlikely to improve Ethereum’s scalability significantly, James Key, CEO of Autonomy Network told CoinDesk. “It’s a common misconception that The Merge will bring more scalability to Ethereum, because while it introduces proof-of-stake, which makes the network more efficient and environmentally friendly, it won’t make transactions cheaper, he said. “The Merge to proof-of-stake dramatically reduces Ethereum’s power consumption by 99.9%,” said Junnu Salovaara, head of crypto finance company Likvidi, adding the network would now sit alongside arguably sustainable projects such as Tezos, Solana and Algorand.

Securities and Exchange Commission does not have jurisdiction over “pure commodities or their trading venues,” including “crypto assets.” The digital assets industry has to contend with a high-interest rate environment, with quantitative tightening at levels not seen in decades ⁠– enormously higher than the world Ethereum “grew up” in. “However, the upcoming FOMC is going to be a key point for the markets as participants price in a 75 bps rate hike while some are expecting even more hawkish measures.” Unlike most non-fungible tokens, China’s “digital collectibles” are built on closed networks and designed to appease regulators who frown on trading and speculation. Developers say the move away from a proof-of-work system will make the network much cheaper and faster, and more environmentally friendly.

Institutions Are Still ‘Wait-And-See’ With Ethereum

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. The FOMC bitcoins market cap crosses $1 trillion as etfs start trading seems likely to boost interest rates 75 basis points for a third consecutive time, although the prospects of a 100 basis point hike rose to over 30% on Wednesday. In crypto news, Ethereum co-founder Vitalik Buterin surprised attendees at the Kyiv Tech Summit on Friday to show support for war-torn Ukraine. And LUNA, the cryptocurrency of the Terra blockchain’s recreated version after dramatically imploding earlier this year, tripled in price within a few hours time Friday, trading close to its all-time high set in early June when the token was introduced.

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The initiative would offer the latest evidence of traditional financial services firms’ growing interest in the crypto space. To be sure, the digitization of traditional financial vehicles through blockchain and digital ledger technology provides a long list of benefits. The problem is that despite the endorsement of Singapore’s regulator, these offerings aren’t hitting their stride because regulations are holding them back. Meanwhile, Barclays analyst Benjamin Budish initiated coverage of crypto exchange Coinbase with an equal weight rating and $80 price target, although he also noted the threats of regulatory risk and exposure to retail trading revenue. These companies can pay higher interest rates on these assets than most banks do on savings accounts by lending their tokens to other investors.

Crypto Winter Has Arrived. Here’s How Advisors Can Help

SEC Chairman Gary Gensler spoke with CoinDesk’s Nikhilesh De about crypto regulation, stressing that most cryptocurrencies are securities and that crypto service providers, including exchanges, have an obligation to register. Also joining the program was Andre Portilho of BTG Pactual with his crypto markets analysis and an update on inflation and crypto adoption in South America. They would much rather it be the region’s digital assets hub, a term that encompasses crypto but also includes digitized financial products like security token offerings . Ether, the second-largest crypto by market cap and token of the Ethereum blockchain, was recently changing hands above $1,600, up 0.8% from a day earlier.

  • “First Mover” dove into markets as ether led a crypto relief rally and bitcoin seemed to find support at $20,000.
  • BTC alternated fluttering above and below $19,000 for much of the U.S. trading day.
  • “With The Merge, Ethereum is moving to PoS (proof-of-stake), which will exponentially reduce its carbon footprint,” added Bjelic.
  • All the trading takes place behind virtual closed doors on the DBS Digital Exchange using permissioned blockchains.

Sweden’s Riksbank became the latest, boosting its rate 1% on Tuesday, its largest increase in nearly two decades. Investors didn’t need a crystal ball on Tuesday to know that the U.S. central bank will likely announce a 75 basis point interest rate increase in less than a day. The documents relate to SEC communications with how safe are cryptocurrencies third parties regarding bitcoin, XRP or ether. Ripple is seeking to force the SEC to disclose why it came to the conclusion that bitcoin and ether are commodities, not securities like XRP. Lawyers representing Ripple Labs, CEO Brad Garlinghouse and a co-founder, Chris Larsen, filed a motion Friday to compel the U.S.

“I think 75 is probably the right number in terms of the Fed interest rate hike, Global X ETF’s See said, although he added that Fed Chair Jerome Powell’s comments about how he views the market place’s “would be really telling.” Most other major cryptos were in the green after climbing over the course of the day with XRP and SOL each recently up more than 4% and ALGO rising over 7%. Among the biggest losers, TRX and UNI were both off approximately a percentage point. The Merge will lead to the reduction of the Ethereum blockchain’s carbon footprint, but it will not lower gas fees or improve Ethereum’s scalability, coders behind popular Ethereum-based projects said; bitcoin trades sideways. Some Merge observers see long-term environmental benefits and price increases, although others are concerned about centralization and regulatory scrutiny. Ether and other major cryptos spend much of the weekend in the red to close a turbulent week.

They mostly shrugged as the weeks-long, telegraphed move neared, sending bitcoin and most other major cryptos lower. The largest cryptocurrency by market capitalization was recently trading just below $19,000, down more than 3% over the last 24 hours. BTC alternated fluttering above and below $19,000 for much of the U.S. trading day. Brian Quintenz, a Republican commissioner for the Commodity Futures Trading Commission , tweeted Wednesday that the U.S.

Trustee’s office to appoint an independent examiner to investigate embattled crypto lender Celsius Network’s financial management that led the firm to file for bankruptcy earlier this summer. “Given the jump in ETH/USD’s price last month, the Merge appears to have been priced in,” James Trescothick, global market analyst for brokerage platform tixee, wrote in an email. “This has been circulating for some time, so there is no element of surprise, so a strong rally is not likely.” In a bad news is good news data point, mortgage rates increased to their highest level in almost 14 years, the latest sign of the sort of cooling economy that the Fed is seeking. The 30-year fixed mortgage rate is now approaching 6%, about double where it stood a year ago, a weekly report by mortgage provider Freddie Mac showed. Web3 and blockchain technology is changing the future of money and how we will govern our lives.

The Investor’s Perspective on the Bitcoin Taproot Upgrade

The Telegram group counted among its many participants the-then unknown developers and investors such as Synthetix’s Kain Warwick, Yearn’s Artem K, DeFiance Capital’s Arthur Cheong and Compound’s Robert Leshner, among several others, who have since evolved into DeFi superstars. Ethereum lending projects Aave and Compound started offering institutional versions of their products in 2021, while Maker brought an SME loans platform called Monetalis into the Maker fold, with Maker as the sole backer – despite token holders’ opposition. The subpoena comes four months after Long Blockchain was delisted from the Nasdaq stock exchange after losing an appeal over the decision and a resultant drop in the value of its stock. Long Blockchain, the beverage maker that made headlines last year when its stock surged following a pivot to blockchain and a related name-change, has been subpoenaed by the U.S. Long Blockchain, which made headlines last year when its stock surged following a blockchain pivot, has been subpoenaed by the SEC in the U.S.

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