Crypto lawsuits, Hinman and a rare break in rate hikes

[ad_1]

Bitcoin fell 3.47% from June 9 to June 16 to trade at US$25,561 as of 3:30 p.m. Friday in Hong Kong. The world’s largest cryptocurrency by market capitalization fell below US$25,000 for the first time in three months, before recovering. Ether fell 9% over the week to settle at US$1,670.

This week, crypto investors’ appetites continued to be weighed down by the ongoing Securities and Exchange Commissions (SEC) lawsuits against Binance and Coinbase. The SEC filed a motion to freeze the assets of Binance.US, which was denied by the court on Wednesday. DC District Court Judge Amy Berman Jackson ordered Binance.US to share its business expenses with the court while the two sides continue negotiations.

The current crackdown can be seen as a preemptive strike, dating back to the collapse of FTX in 2022. US crypto companies will automatically adapt their business to new rules resulting from the outcome of the lawsuits. As long as there’s no immediate threat from other crypto firms, the SEC might be happy with this latest show of arms, said Jonas Betz, crypto market analyst and consultancy firm founder Betz Crypto, to Forkast in a LinkedIn response.

Mike Brusov, co-founder of crypto intelligence firm Cindicator, said distrust of fiat currencies led to a large influx of capital into crypto, which took Bitcoin to US$29,538 in May, and that the SEC’s aggressive lawsuits were aimed at halting this trend.

There are a host of weird moments involved in this situation, Brusov said, referring to SEC Chairman Gary Gensler’s alleged offer to serve as an adviser to Binance. Also, a long list of plays have been declared as unrecorded titles. This extreme accusation suddenly included high-level blockchains whose tokens have a specific utility while being integral to the project as a whole, Brusov wrote.

In the SEC’s other lawsuit against San Francisco payments firm Ripple Labs, the Hinman Filings, internal communications documents from former SEC official William Hinman, were released this week. A June 2018 email from Hinman said the agency did not classify Ether, the native cryptocurrency of the Ethereum blockchain, as a security. This statement could influence the allegations made by the Commission against Ripple. The SEC argues that XRP, the cryptocurrency used in Ripples products and services, is a security.

A June 2018 email from Hinman said the agency did not classify Ether, the native cryptocurrency of the Ethereum blockchain, as a security. Images: SEC, Envato ElementsRate increases: Press start to pause

The US consumer price index showed inflation rose at an annual rate of 4% in May, below the 4.1% expected, marking the weakest inflation growth in two years.

The Federal Reserve on Wednesday announced a pause in interest rate hikes, leaving its lending rate at 5% to 5.25% after more than a year of consecutive rate hikes. Bitcoin fell to US$24,983 on Wednesday after the Fed signaled that two more rate hikes are expected this year.

This is a clear sign that the United States is winning the war on inflation. As a result, there was an initial sell-off in the crypto market. That was short-lived as the market quickly rebounded as investors bet on continued economic growth and corporate profitability despite higher borrowing costs, the platform’s Chief Investment Officer Lucas Kiely wrote to Forkast. Digital Asset Yield App.

The US Federal Reserve has signaled that two more rate hikes are expected this year. Image: Win McNamee via Getty Images.

Adding to investor concerns, the European Central Bank raised interest rates by 25 basis points to 3.5% on Thursday, the eighth straight hike. This brings the region’s interest rates to their highest level in 22 years. The central bank has also indicated that it plans to raise interest rates this year.

The global crypto market capitalization stood at US$1.04 trillion as of 3:30 p.m. Hong Kong on Friday, down 5.45% from US$1.1 trillion a week ago, according to the data from CoinMarketCap. With a market capitalization of US$495 billion, Bitcoin accounted for 47.8% of the market while Ether, valued at US$200 billion, accounted for 19.3%.

See related article: US SEC Sues Major Exchanges; Circle obtains a license in Singapore

Notable movers: EOS and APE

The layer 1 blockchain protocol EOS Networks (EOS) token was the biggest loser this week in the top 100. EOS fell 28.97% to $0.6355. The token began its downtrend on Saturday, under pressure from SEC lawsuits and general negative market sentiment.

ApeCoin, the official crypto of the Bored Ape Yacht Club ecosystem, was the second biggest loser in the top 100 this week. ApeCoin fell 27.98% to trade at US$2.09, along with most notable metaverse tokens. The Sandboxs (SAND) token also fell by 21.53% while the Decentralands (MANA) token fell by 19.56% on the weekly chart.

See related article: Why the US is waging war on Binance, Coinbase

Next week: Can Bitcoin hold $24,000?

Next week, investors will be eagerly awaiting keynote speeches from several members of the Federal Open Market Committee (FOMC), including Federal Reserve Bank of Cleveland President Loretta Mester, Atlanta Fed Chief Raphael Bostic, and St. Louis Fed President James Bullard. . Federal Reserve Chairman Jerome Powell is also expected to testify on the Fed’s recent monetary policy actions on Wednesday and Thursday.

The Bitcoin Fear & Greed Index, which is a multifactor measure of crypto market sentiment, fell from 41 points on Thursday to 47 points on Friday, signaling that investor sentiment has shifted from fearful to neutral.

As market participants fear the SEC could crack down on other exchanges, Kasper Vandeloock, managing director of quantitative trading firm Musca Capital, doesn’t expect any further lawsuits from the SEC. without more regulatory clarity in the United States.

Yield Apps Kiely said the price of Bitcoin is likely to remain rangebound next week unless it breaks below US$24,000.

To confirm an uptrend, Bitcoin prices need to close the week above the key US$30,500 level. Bitcoin has been trading below this level for several weeks now, with no bulls or bears taking control. On the other hand, if prices fail to hold above current levels, it could indicate continued bearish sentiment. Investors should also keep an eye out for another key level at US$24,000, Kiely wrote.

See related article: BlackRock files for spot Bitcoin ETF, taps Coinbase as custodian

[ad_2]