Bitazza Crypto Weekly: US Moves Forward With Crypto-friendly Regulations -

Crypto Weekly: 14 – 20 March 2022

US President Joe Biden has signed an executive offer ordering the exploration of cryptocurrency risks, blockchain, and distributed ledger technology. The executive order is the first-ever federal strategy on crypto and is hoped to position the US in a leading role in the innovation and development of the digital asset ecosystem while protecting consumers’ interests and rights.

Biden stresses that this approach aims to study the potential effects of crypto and support growth rather than actively hindering the development of the crypto industry within America. While he appears to be tentatively optimistic and aims to position the US as a crypto leader and innovator, Biden has also expressed concerns regarding the environmental impact of crypto, particularly Bitcoin mining.

The executive order also mentioned a potential US Digital Currency, leading to renewed speculation of a US Central Bank Digital Currency (CBDC). Currently, the Federal Reserve is still within the preliminary research stage regarding the creation of a US CBDC, but the Biden administration’s stance on CBDC could mean that a more substantial plan could be in the works.

In contrast, the US SEC continues to reject applications for spot Bitcoin ETFs, with the SEC denying applications from NYDIG and Global X, citing concerns regarding investor protection such as fraud, manipulation, and valuation methodology. These rejections are in line with previous comments by SEC Chair Gary Gensler, who has stated that he prefers BTC futures ETFs over ones that hold BTC directly; and have rejected applications from Fidelity, First Trust, Kryptonian, Van Eck, and WisdomTree previously.

Ukraine Vice Prime Minister Mykhailo Fedorov has asked Tether to stop servicing Russians. While Tether has not commented on the request officially, Coinbase and Kraken have publicly refused to impose blanket-bans on Russian addresses. The exchanges state that they may block or ban specific accounts for legal reasons but will not be implementing a ban that indiscriminately targets Russian citizens.

According to data from Kaiko, a Paris-based cryptocurrency research provider, Ruble-denominated Bitcoin trading volume has surged to its highest level this year following the invasion of Ukraine. This spike in Ruble-based crypto trading is likely due to investors moving out of the Ruble in an effort to avoid sanctions from Western powers.

According to current projections, Bitcoin is expected to reach the milestone of 19 million BTC mined within this month. Currently, 18.97 million BTC have been mined, approximately 90% of the total supply; however, due to the halving of mining rewards every 210,000 blocks and the increasing mining difficulty, the last Bitcoin will likely be minted around 2140.

The Ethereum consensus layer (previously known as Ethereum 2.0) has surpassed 10 million ETH staked. The total staked ETH in the deposit contract is valued at approximately $26 billion, despite the migration to proof-of-stake consensus still in progress.

Finally, data from CoinMetrics indicates that Ethereum transaction fees have dropped to a six-month low. This is likely due to the cooling-off of the NFT market, which was the main cause of the high gas fees seen throughout 2021.

Weekly Technical Analysis: 14 – 20 March 2022

Bitcoin (BTC)

BTC continues to trend sideways, but perhaps optimistically is continuing to create higher lows. Traders should consider entering a position if the support level at $34,000 can remain intact or if BTC can rally and break through resistance at the $45,000 level.

Ethereum (ETH)

Much like Bitcoin, ETH’s future direction is uncertain but the DeFi market leader has managed not to create lower lows. ETH’s trendlines are beginning to form a symmetrical triangle pattern, suggesting that an upwards breakout past the resistance at $3,000 or a downwards breakout through support at $2,300 is imminent.

THORChain (RUNE)

RUNE is up by +44% from last week and has been performing very well recently. RUNE’s short-term trend will continue as long as the support at 130 Baht remains intact. Expect RUNE to test the resistance at 250 Baht this week. Traders should consider entering a position on RUNE if prices dip.

Immutable X (IMX)

IMX is up by +51.3% from last week. The overall trend is still bearish; however, if there is enough buying pressure around the 37.50 Baht support level, we could see an upwards reversal. IMX will look to target an initial resistance at the 80 Baht level this week, which would confirm an uptrend for the NFT platform token.

Trading and Investment Considerations For The Week

US inflation continues to rise, with the February figures indicating an increase of 7.9%. Keep an eye on the upcoming FOMC meeting on March 15-16, where the FED will likely outline interest rate raises and monetary policy going forward. Results from this meeting could impact the crypto market.

Market sentiment is that the FED will be raising interest rates by 0.25% instead of the most recent 0.5% rate hike. If the FED raises rates by 0.5% or more, this could have a negative impact on the market. Regardless, it is unlikely we won’t see an interest rate increase as inflationary pressures are still persisting.

The market may move in anticipation of the FOMC market. Those with a lower tolerance for risk should consider waiting for the trend direction to become clearer first. If BTC undergoes a correction but doesn’t fall through the $34,000 level, consider entering a position at that price point.

However, if BTC rallies and surpasses the $45,000 mark, consider following the trend and aim to ride the rally and make a profit. Breaking through the $45,000 level would indicate that the market direction is reversing into an uptrend. As always, carefully considering the market trend and making trades accordingly remains the safest strategy to follow while trading.

The tokens that have had particularly strong rallies recently have all been tokens that have seen significant improvements to their fundamentals. Rather than focusing on which group is attracting attention at the moment, such as Metaverse or Smart Contract platform tokens, traders are advised to try and identify which projects are improving or have solid fundamentals and invest accordingly. If traders can identify which tokens are performing well right now, they should focus on taking profits in the short term.

*Materials on Bitazza Weekly Newsletter are intended to be used and must be used for informational purposes only. The views, information, or opinions expressed are solely those of the individuals involved and do not necessarily represent those of Bitazza and its employees. The information contained herein is not intended to be a source of advice or financial analysis with respect to the material presented, and the information and/or documents contained in this website do not constitute investment advice.

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