Signs of End of Crypto Winter as Regulatory Fog Begins to Lift

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Ripple decision sets precedent for crypto regulation

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Bitcoin hits 1-year high; surge in altcoins

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Coinbase stock doubles in a month

SINGAPORE, July 14 (Reuters) – Cryptocurrencies tested yearly highs on Friday as a series of supportive regulatory and investment measures began to shift momentum in markets that had been stuck in a rut for months.

Bitcoin traded at its highest price since June 2022 overnight, touching $31,818 on the Bitstamp exchange. It’s up more than 90% for the year so far and almost 30% in a month.

The second-largest Ether token had its best session since March and Ripple, which a US judge ruled could be legally sold on public crypto exchanges, soared 73%.

“The regulatory environment is changing,” said Matthew Dibb, chief investment officer at crypto asset manager Astronaut Capital. “And from what we’ve seen over the past 24 hours, that could be for the best.”

The Ripple decision was accompanied by accusations of fraud against the former boss of bankrupt crypto lender Celsius Network, which are disputed, and following the entry of financial firms BlackRock and Fidelity.

Investors say this is causing a change in mood.

“Ripple’s stakeholders have been waiting for some regulatory clarity. Yesterday the court appears to have provided exactly that,” said Justin d’Anethan, Asia business development manager at Keyrock, a digital asset market maker in Hong Kong.

The language remains somewhat hazy, he said, but finding that XRP tokens sold on public crypto exchanges were not securities under the law “probably served as a precedent…and therefore digital assets have become unequivocally ‘at risk’.

It sparked a rally in smaller cryptocurrencies called “altcoins”, with tokens such as Solana, Matic and Stellar up 15%-50% and Coinbase exchange shares up 24% to hit a high. one year.

Traders said liquidity was low on altcoin moves but steadily improving in bitcoin and ether. Coinbase stock revenue was the highest in 14 months on Thursday, lending weight to a move that more than doubled the stock price in a month.

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MOMENTUM

Crypto assets are now trading near or above the levels reached when the FTX stock market crash last November plunged the sector into the depths of what has been dubbed “crypto winter.”

FTX imploded when it was unable to honor a rush of withdrawals and its failure, exposing customers to losses, gave impetus to global regulatory efforts to rein in the industry, particularly to protect small investors attracted by quick returns.

China has virtually banned crypto. US investigators combing through FTX have charged founder Sam Bankman-Fried with multi-billion dollar fraud, to which he has pleaded not guilty.

Celsius founder Alex Mashinsky also pleaded not guilty to his charges on Thursday and, of course, many other legal challenges remain pending and market setbacks are expected.

Coinbase and its biggest rival Binance are facing lawsuits, which they are contesting, from the SEC and, in Binance’s case, other regulators as well. A senior SEC official said last month that the industry has “a philosophy built on non-compliance.”

The entry of traditional financial firms into crypto, bringing in large sums, has evoked memories of the rally that lifted bitcoin by 300% in 2020.

The world’s largest asset manager, BlackRock, filed an application to launch a bitcoin exchange-traded fund last month and earlier in July, exchange operator Cboe updated its filing for a fund. similar to be managed by asset manager Fidelity.

“We had been through this long stretch of consistently negative news to make the space pretty dirty, and everyone was shaking their heads,” said Chris Weston, head of research at brokerage Pepperstone in Melbourne.

“For the first time in a long time the news is still positive and that means you have momentum.” (Reporting by Tom Westbrook and Vidya Ranganathan in Singapore; Editing by Simon Cameron-Moore)

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