Crypto Weekly: 5 – 11 September 2022
The FED has published a report looking at the DeFi sector that examined more than 1,400 dApps in the DeFi space, concluding that with the sector’s rapid and projected growth in mind, DeFi could prove to be a long-term risk to financial security. Specifically, the report highlights the threat posed by large leveraged positions, a cause of previous financial crises.
crypto.com has announced that they will be pulling out of their previously agreed-to $500 million sponsorship deal with UEFA for the Champions League, citing regulatory problems that they are facing in European markets. The regulatory concerns have reportedly raised fears that they could create legal problems for the company’s ability to trade and operate, particularly in the UK, France, and Italy.
Binance CEO Changpeng Zhao (CZ) has publicly refuted claims made in a recent Fortune India article that described Binance as a Chinese-originating company and that Binance and other Chinese-linked centralized crypto exchanges were operating in India illegally. CZ claims that Binance has never been incorporated in China, does not plan on having any legal entities in China, and is not secretly owned by Chinese agents, as some have speculated. He emphasizes that the online FUD and conspiracy theories directed at Binance are detrimental and could undermine the credibility of the entire Crypto industry as a whole.
DC Attorney General Karl Racine has accused MicroStrategy co-founder and former CEO Michael Saylor of evading $25 million in district taxes in a lawsuit filed last week. The lawsuit also names MicroStrategy as a defendant and could see the Attorney General’s office seeking to recover as much as $100 million in unpaid taxes and penalties.
Data from DappRadar reported the trading volume of the world’s largest NFT marketplace Opensea, recently saw a 90% reduction in Ethereum-based NFT sales since January. Meanwhile, NFT floor prices have also tanked across the year amidst the market-wide downturn.
NFT marketplace OpenSea has confirmed that it is committing to solely supporting NFTs on the upgraded Ethereum PoS chain following “The Merge”. NFTs on Ethereum forks post-merge will not be eligible for the marketplace, with OpenSea, the world’s largest NFT marketplace by daily traded volume, having called for a smooth transition as Ethereum transitions to PoS.
Hong Kong tech giant Meitu reported an impairment loss of over 300 million yuan on their Bitcoin and Ether holdings. The company has invested approximately $100 million in crypto and claims that its crypto holdings have lost nearly half of the valuations of its investment by the end of the second quarter of 2022.
According to data from DappRadar, gaming-related transactions accounted for over 50% of total transactions on the blockchain, followed by DeFi with 30% of industry usage month-over-month, as per August figures. According to the report, there are approximately 847,230 daily unique active wallets with nearly $698 million in transactions.
On-chain metrics from trading analysis platform TipRanks indicate that 62% of wallets held BTC for one year and above. In contrast, 32% of wallets were found to have held for a month up to a year. Finally, only 6% of people have been holding BTC for less than a month. The data also shows that 48% of the present holders are making money, while the same amount of holders is making losses.
Weekly Technical Analysis: 5 – 11 September 2022
Bitcoin (BTC)
BTC is moving in an unclear direction, with a critical support level at the $17,500 mark. To confirm an upwards reversal, BTC will have to break through resistance at the $20,700 mark. This week’s prices is anticipated to fluctuate due to the prominent central bank meetings taking place this week globally.
Ethereum (ETH)
ETH is moving sideways with “The Merge” upgrade scheduled to occur next week. If ETH can remain above its previous lower low support level at the $1200 mark and break through the $2,000 resistance, we could see ETH rally into an uptrend. Investors could possibly speculate heavily on ETH this week in anticipation of “The Merge”.
Terra Classic (LUNC)
LUNC is up by +96.5% from the past week; this has confirmed an upwards trend in the short run. However, the sudden price surge could spur a price correction that could push LUNC towards its support level at 0.0080 THB. Short-term resistance is set at 0.0094 THB. Ultimately, the fundamentals and future of Terra Classic remain unclear, and investors are advised to exercise great caution if considering entering a LUNC position.
Balancer (BAL)
BAL is up by +27.2% from the past week and has started to revert to an upwards trend in the short run. BAL will maintain its upward momentum if it can remain above the support level at 250 THB. The resistance level is set at BAL’s previous of 290 THB.
Trading and Investment Considerations For The Week
The US Dollar Index has strengthened, breaking through the 110 threshold and rallying to a new two-decade high. This triggered many investors to take profit on risker assets, triggering a sell-off of stocks and Bitcoin before the end of last week. As a result, the Bitcoin Dominance index has seen a correction, dropping near its low point this year at the 39.16 level.
This week the EU and Japan are set to release their GDP figures, which could impact financial markets across the board. Furthermore, the European Central Bank is set to convene for a rate-setting meeting soon and is anticipated to take a similarly hawkish stance as the FED and raise interest rates at 0.75% to combat the inflation surge.
Furthermore, FED Chair Jerome Powell is set to speak this Thursday, 8 September. Investors are advised to pay close attention to Powell’s statements as they could outline if anything has shifted since the Jackson Hole Economic Policy Symposium last month.
Highlights to keep an eye on in the coming weeks include the release of August’s US CPI figures on 13 September, which will let the market know whether the rate of inflation is beginning to slow. If inflation is improving, this could affect the market positively ahead of the FOMC meeting on 21 September.
It is possible that the release of key economic figures from major central banks around the world could cause some volatility in the market this week. However, Ethereum’s highly anticipated “The Merge” update is scheduled to go live next week, so investors could consider keeping an eye out for potentially profitable speculative opportunities for Ethereum and related tokens like OP this week.
Layer 1 blockchain tokens, including ADA, MATIC, and ATOM, are seeing increased speculation and activity, potentially driven by news of upcoming major upgrades. Despite the increased interest in these tokens, the degree of risk is still significant, and investors are advised to exercise the highest levels of caution before making any significant investments or entering a position.
Disclaimer: Cryptocurrency is highly risky; investors may lose all investment money. Investors should study and verify information carefully and make investments according to their own risk profile.
*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.
Sources:
https://cryptopotato.com/opensea-trading-volume-down-99-from-all-time-high/
https://cointelegraph.com/news/opensea-says-marketplace-won-t-support-forked-nfts-post-merge
https://cointelegraph.com/news/gaming-makes-up-over-half-of-blockchain-industry-usage-dappradar
https://cryptopotato.com/binance-is-not-a-chinese-company-declares-ceo/
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