Crypto Weekly: 17 – 23 October 2022
238-year-old bank, BNY Mellon, has launched its Crypto Custody platform supporting Bitcoin and Ethereum, becoming the first major bank in the US to offer digital asset custody and traditional investment on the same platform.
Finder.com reports that 53% of UK banks now facilitate digital asset transactions. With digital-only banks allowing the most crypto-friendly transactions, while more traditional banks such as Barclays, Lloyds Bank, Bank of Scotland, and RBS currently only allow transactions that meet specific conditions.
France’s third-largest bank, Société Générale, received regulatory approval to begin operations as a digital asset provider in the country last month. The French government previously approved licenses for both Binance and Crypto.com.
DBS Bank, Singapore’s leading financial service firm and holder of a digital asset trading license, has stated that Bitcoin remains an unprecedented opportunity despite concerns about the high volatility in the crypto market. DBS SVP Daryl Ho highlights that Bitcoin’s ability to process continuous transactions without needing a central counterparty for clearing gives the cryptocurrency significant utility, which drives Bitcoin’s value.
Tether Holdings Limited has announced that it has successfully reduced its commercial paper exposure to zero, transitioning its USDT collateral assets from short-term private equity securities to 100% US government bonds. This move is ostensibly an attempt to boost confidence in USDT holders and respond to detractors publicly criticizing Tether’s asset composition over the past year, specifically its alleged holdings of Chinese commercial papers. Change your asset status reporting plan from quarterly to monthly. Additionally, the stablecoin issuer said it planned to increase its reporting frequency from quarterly to monthly.
Binance announced its 21st quarter BNB token burn, removing 2.065 million tokens from circulation, valued at approximately $547 million. This round represents the highest BNB token burn in dollar terms so far.
DappRadar’s latest BGA Games report reveals that Blockchain and Metaverse projects raised $1.3 billion during the third quarter of this year, down 48% from Q2 2022 but nearly doubling when compared to the same period last year. Additionally, the number of unique active wallets has increased by 8% month-on-month.
Activeplayer revealed that the average monthly active users for Axie Infinity dropped to 701,447 from its peak of 2.78 million in January 2021. This previous June, Axie Infinity reportedly lost 1.2 million players, potentially due to the impact of the crypto market downturn and game mechanic issues that may have contributed to the departure of players.
Renowned investor Paul Tudor Jones revealed that he still has a small stake in Bitcoin and sees the possibility of higher BTC value in the future. Jones has allegedly held Bitcoin since 2020 and has stated that he believes that high inflation will have a positive effect on the Bitcoin price.
Bitcoin mining difficulty has hit new highs alongside BTC hash rate. Despite the drop in trading prices, mining difficulty continues to rise from the lows last seen in August 2021.
Bloomberg reported that Yuga Labs, creators of the Bored Ape Yacht Club, is facing an investigation by the US Securities and Exchange Commission over whether the BAYC NFT collection violated Federal securities law. The SEC is looking into whether NFTs sold by Yuga Labs are similar to securities and whether they should be classified as such and follow similar rules under the supervision of the government.
Ethereum-based Layer 2 protocols Arbitrum and Optimism have seen a steady increase in transactions since the beginning of the year. Both protocols also set new all-time highs in transaction volume in September, with Arbitrum and Optimism owning 50% and 30% market shares, respectively.
Weekly Technical Analysis: 17 – 23 October 2022
BTC is facing high volatility following the release of US inflation figures. Despite a sell-off and being unable to create new highs, BTC has refrained from setting lower lows. Traders could potentially consider entering a BTC position near the $18,100 support level and taking profit near the short-term resistance level at $20,500.
ETH has reverted to a short-term downtrend. Considering how long ETH prices have trended sideways, we could potentially see ETH prices enter a stronger trend in either direction soon. Support and resistance are set at $1,200 and $1,500, respectively.
DYDX is up by +11.3% over the past week; however, its overall trend remains bearish. As there have been no notable developments regarding the DEX’s fundamentals, this rally is likely a result of market speculation. Traders could perhaps consider a short-term trading strategy that revolves around looking for an entry point near the 48 baht support and taking profit near the 66 baht resistance level.
MKR is up by +9.5% from last week. While it looks like MKR is close to an upwards recovery, traders are still advised to exercise extreme caution when trading. This week, support is set at 28,000 baht. If this support cannot remain intact, traders should consider cutting their losses. MKR will look to target resistance at the 48,000 baht mark.
Trading and Investment Considerations For The Week
September’s US inflation figures came out at 8.2%, slightly above market expectations of 8.1%, triggering a sell-off of Bitcoin and other traditional assets before recovering. Strong selling pressure remains; therefore, the market remains highly uncertain and volatile at the moment.
There are no major US economic announcements scheduled for this week. FED director James Bullard has reiterated his hawkish stances towards monetary policy, but this is unlikely to impact the market much, as his support of the interest rate hikes is well-known at this point. Europe-wise, critical economic figures and inflation figures are scheduled to be released this week, with this potentially having significant impacts on the overall market.
Based on historic trends, the fourth quarter of each year is typically when the US stock market sees a positive correction. If this year remains the same, a stock market rally is expected to positively impact Bitcoin prices and benefit the crypto market as a whole.
However, greater certainty regarding Bitcoin’s trend is likely needed for trading activity to pick up. The market is paying close attention to Bitcoin’s original low at $17,500 and its resistance at $25,000. Until Bitcoin can clearly rally into an uptrend, the market will likely remain uncertain in the short term.
-Cryptocurrency and Digital tokens are highly risky; investors may lose all investment money. Investors should study information carefully and make investments according to own risk profile.
– Past Returns/Past Performance does not guarantee future returns/performance.
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