Bitcoin-focused financial services firm New York Digital Investment Group (NYDIG) has released a report in which it found that increased regulatory clarity was beneficial to the price and adoption of Bitcoin.
Regulatory Clarity, Helpful or Hurtful?
The report notes that regulatory clarity is often cited as a significant hurdle for institutional adoption, however NYDIG has maintained the opposite view, believing that adoption would grow once investors “know the rules of the road”.
To test its thesis, the company looked at historical events related to digital asset regulation across a number of international jurisdictions. These events encompass matters including tax, accounting, payment, mining, the legal status of exchanges and other service providers, or even the legality of crypto assets themselves.
It then tracked the subsequent price returns of bitcoin in the following day, week, month, six months and year, with a focus on the longer-term windows. The returns were then evaluated in both absolute and relative (ie, average) terms.
Investors and Price Welcome Regulatory Clarity (Mostly)
The report noted that, other than China, which has implemented countless bans on mining and digital asset ownership, most other jurisdictions were “supportive but with guardrails”.
Aside from China, where regulations had a deleterious impact on price, across all other jurisdictions the study offered clear evidence that on both an absolute basis and relative basis, increased regulatory clarity was favourable for the price of bitcoin. This was particularly the case across six- and 12-month timeframes.
BTC absolute performance after a regulatory event. Source: NYDIG
BTC relative performance after a regulatory event. Source: NYDIG
The implication then is that regulatory clarity, despite its flaws, is appreciated by investors. Noting that retail only accounts for a quarter of volume, it’s little surprise that regulation brings with it positive price action across longer timeframes.
With bitcoin capitulating below its previous cycle’s all-time high, one wonders what the impact will be of the recently released US “crypto bill”, dubbed the Lummis-Gillibrand Responsible Financial Innovation Act, once passed.
Troubled crypto hedge fund Three Arrows Capital (3AC) has been ordered into liquidation by a court in the British Virgin Islands, according to a news report published amid the 2022 crypto crisis.
JUST IN: Three Arrows Capital is rebranding to THREE ZEROs Capital
The order came on June 29, the same date that crypto asset broker Voyager Digital issued a notice of default to 3AC for its failure to pay its 15,250 Bitcoin and 350 million USDC loan. Voyager’s shares had plunged after it disclosed its exposure to 3AC.
3AC Liquidation Marks ‘Significant Moment’ in Sector
Singaporean-based crypto hedge fund 3AC, which was set up in 2012 by partners Su Zhu and Kyle Davies, has been plunged into liquidation amid current crypto market turmoil.
The fund suffered heavy losses as Bitcoin dropped below US$20,000 for the first time in two years and the possibility of insolvency was reported in mid-June after the firm incurred at least US$400 million in liquidations.
Crypto insiders have described the liquidation as “a significant moment in the current unravelling of the cryptocurrency sector, which [had] grown at breakneck speed in recent years”.
3AC’s troubles can be attributed to its significant exposure to Terra’s LUNC token. Reportedly, 3AC’s position of roughly US$200 million in locked Luna Classic evaporated to less than a thousand dollars, with Davies telling The Wall Street Journal that “the Terra Luna situation caught us very much off guard”.
Like many in the space, Twitter user LomahCrypto is of the opinion that 3AC could have acted earlier, tweeting: “I try not to shit on 3AC but ffs I don’t understand how you could tweet some shit like this in May, while your firm is severely underwater and probably at risk of liquidation. Either the self-awareness is nonexistent or this was an actual hint into their operations.”
3AC co-founder tweeted this in May. Source: MoonOverLord via Twitter
Nothing to See Here: Founders
As reports run rampant regarding 3AC’s insolvency, the company’s founders continue to assure customers that they are doing their best to find an equitable solution to the current situation. As such, the firm has hired legal and financial advisers to explore assets sales and a possible rescue package by another firm.
Ethereum-based, decentralised blockchain platform Stratis has witnessed its native token STRAX rocket 103 percent in one 24-hour period this week, cooling off from a rally that at one point reached 160 percent.
STRAX took off minutes after the project announced a series of updates, including a new ticketing system via which NFTs will be used to validate entry to venues and distribute rewards at events.
Stratis has also foreshadowed several new blockchain-powered video games set to hit its mainnet later this year, along with issuing an update on its launch of a stablecoin pegged to the British pound called Great British Pound Token (GBPT).
The platform is currently working with Price Waterhouse Coopers (PwC) to complete regulatory registration and expects the partnership to be ongoing with PwC providing auditing services for the GBPT stablecoin’s implementation.
According to the Stratis announcement, “With entities like Visa increasingly willing to accept stablecoin payments, there’s a huge opportunity to simplify cross-border and wholesale payments using blockchain technology.”
Prior to this week’s STRAX price rally, the team behind the protocol teased the upcoming launch of Sky Dream Mall, a new metaverse project powered by the Stratis blockchain:
All of which is in clear defiance of the current bear market and the onset of the so-called ‘crypto winter’. These are arguably the most positive developments in the sector since April, when blockchain-based music platform Opulous saw the price of its token, OPUL, rally 175 percent after it announced DeFi staking, CEX listings and S-NFT sales.
You’d have to go back even further to find another one-day performance to rival that of STRAX this week. In February this year, the utility and governance token for the DEX Injective Protocol rallied more than 100 percent in a single day following the listing of Cosmos (ATOM) perpetual futures on the platform.
Celsius CEO Alex Mashinsky seems to have been omitting the truth from multiple past statements that his company was not “taking a tremendous risk”. This comes as The Wall Street Journal uncovers evidence illustrating that Celsius had effectively doubled the risk profile of the average American bank.
All North American banks in the S&P 1500 Composite index have a median assets-to-equity ratio of close to 9:1. Information uncovered by the WSJ found that Celsius had US$19 billion of assets and approximately US$1 billion of equity just before October 2021.
This wasn’t the only discovery. Investor documents detailed that Celsius had sold undercollateralised loans in the past, which required business borrowers to post approximately 50 percent collateral for their loans. It is alleged that Celsius then used the collateral from these loans to borrow more:
1/ Celsius is *still not* DeFi. It is centralized, it took control of customer assets & it was run via human, subjective judgment on risk. Other side of the spectrum from how DeFi works and what it is. https://t.co/5LcHpTRQnP
With industry regulators typically looking at the assets-to-equity ratio as an indicator of risk, economist Eric Budish from the University of Chicago has described the Celsius ratio as “a risky structure”. Budish also stated that “it strikes [me] as diversified in the same way that portfolios of mortgages were diversified in 2006 … it was all housing – here, it’s all crypto.”
In October 2021, Celsius had been offering retail investors the chance to earn yields of up to 18.6 percent on deposited crypto assets. The lender had initially projected that deposits would exceed US$108 billion in 2023. However, this year’s industry lows have hit Celsius hard, with the company now considering filing for bankruptcy.
Celsius’ Recent Raft of Troubles
June was a disappointing month for Celsius with its native token (CEL) falling nearly 70 percent following the June 13 announcement that it would pause all withdrawals to “stabilise liquidity”. However, prior to this declaration, it is rumoured that Celsius had quickly transferred US$320 million in crypto to the Bahamian exchange FTX.
This presumed one-way ticket to insolvency also encouraged crypto services business Nexo to come forward and offer to buy Celsius’ “qualifying” assets. Nexo was believed to be interested in Celsius’ collateralised loan portfolio, yet it has since been reported that no prices were disclosed.
Let’s take a closer look at today’s altcoins showing breakout signals. We’ll explain what the coin is, then dive into the trading charts and provide some analysis to help you decide.
1. Zcash (ZEC)
Zcash ZEC is a decentralised cryptocurrency focused on privacy and anonymity. It uses the zk-SNARK zero-knowledge proof technology that allows nodes on the network to verify transactions without revealing any sensitive information about those transactions. Zcash transactions, on the other hand, still have to be relayed via a public blockchain but, unlike pseudonymous cryptocurrencies, ZEC transactions by default do not reveal the sending and receiving addresses or the amount being sent.
ZEC Price Analysis
At the time of writing, ZEC is ranked the 50th cryptocurrency globally and the current price is US$53.23. Let’s take a look at the chart below for price analysis:
ZEC‘s recent bearish flip of the 9, 18 and 40 EMAs may cause bulls to be less aggressive in bidding. However, possible support near $50.47 and $41.96 – between the 41.8% and 58.6% retracements – could see at least a short-term bounce.
Last year’s long-term consolidation suggests that the areas near $84.23 may be more likely to cause a longer-term trend reversal.
Bears are likely to add to their shorts at probable resistance beginning near $95.50, which has confluence with the 18 EMA. A fast break of this resistance could trigger more selling near $106.12, the start of the bearish move.
If an aggressive bullish move does appear, trapped buyers in the probable resistance beginning near $115.32 might provide a ceiling for this impulse.
2. Request (REQ)
The Request REQ utility token ensures the performance and stability of the Request Network. The Request Network itself is an Ethereum-based decentralised payment system where anyone can request a payment and receive money through secure means. It removes the requirement for third parties in order to provide a cheaper, more secure payment solution that works with all global currencies.
REQ Price Analysis
At the time of writing, REQ is ranked the 160th cryptocurrency globally and the current price is US$0.1174. Let’s take a look at the chart below for price analysis:
REQ has continued its rally through the daily gap between $0.08133 and $0.1057, turning this region into an area of possible support.
However, a stop run under the relatively equal lows at $0.07583 could form a wick below this level, potentially reaching an untapped daily gap beginning near $0.07051.
Resistance beginning at $0.1372 has seen significant profit-taking, shown by the long upper wicks on the daily candles. A break of this resistance may reach the next significant swing high at $0.1507, continue into probable resistance just above, and possibly set a new monthly high at $0.1833.
3. Cosmos (ATOM)
Cosmos ATOM bills itself as a project that solves some of the “hardest problems” facing the blockchain industry. It aims to offer an antidote to “slow, expensive, unscalable and environmentally harmful” proof-of-work protocols, like those used by Bitcoin, by offering an ecosystem of connected blockchains. ATOM tokens are earned through a hybrid proof-of-stake algorithm and they help to keep the Cosmos Hub, the project’s flagship blockchain, secure. This cryptocurrency also has a role in the network’s governance.
ATOM Price Analysis
At the time of writing, ATOM is ranked the 27th cryptocurrency globally and the current price is US$7.10. Let’s take a look at the chart below for price analysis:
ATOM has been consolidating in a range around Q1 2022’s high. Q2 2022 saw the start of a smaller range inside this larger range. Near the current price, $7.00 or $6.80 could support at least a small move upward. This area is near the local range low, inefficiently traded, and the site of a stop run.
Just above the current price, the 9, 18 and 40 EMAs might provide resistance near $7.86. This level saw consolidation before last week’s downward move.
A move back toward the local range highs could reach possible resistance near $8.65, where bears rejected the recent rally. This level is just above the May monthly open.
A more extended move by bulls might reach the larger range’s rejection area near $9.81. However, a move this far is less likely unless the overall market rallies.
Below the higher timeframe’s range, $6.75 to $6.10 could provide more substantial support to start a longer-term bullish trend. This level is near the 78.6% retracement of the July 2021 to September 2021 rally, shows inefficient trading on higher-timeframe charts, especially between $6.05 and $5.90, and provides a reasonable stop run target.
These coins have high liquidity on Binance Exchange, so that could help with trading on AUD/USDT/BTC pairs. And if you’re looking at buying and HODLing cryptos, then Swyftx Exchange is an easy-to-use popular choice in Australia.
KPMG, one of the ‘Big Four’ accounting firms in Canada and the US, is opening its first metaverse collaboration hub to help employees and clients pursue new opportunities in the digital space.
The company’s stated long-term objective is to examine other potential metaverse use cases such as healthcare, retail, media, and consumer and financial services.
Of a total of US$30 million in investments this year in Web3 pursuits, KPMG cites the metaverse hub as its “signature piece”, focusing on education, training, events, and workshops.
Speaking about the metaverse generally, Laura Newinski, deputy chair and chief operating officer of KPMG US, said:
It’s a market opportunity, a way to re-engage talent, and a path to connect people across the globe through a new collaborative experience …The unique experience provided by our collaboration hub will tap the creativity and passion of our people and clients to accelerate innovation.
Laura Newinski, deputy chair and chief operating officer, KPMG US
Alkemi Network, a crypto lending platform that combines centralised finance (CeFi) with decentralised finance (DeFi), has announced a partnership with hardware wallet maker Ledger.
The integration with Alkemi Earn means that Ledger’s 1.5 million users will be able to earn yields with their ETH, wBTC (wrapped Bitcoin), or USDC directly on their wallets’ interfaces:
If you want to dive more into DeFi this year, you’ll be happy to learn that we’re integrating @AlkemiNetwork into Ledger Live.
Alkemi is a liquidity network allowing individuals to earn yields on their Ethereum-based digital assets!
Since launching in April 2021, Alkemi Network claims it has received over US$50 million in gross deposits, and the integration with Ledger is expected to boost those numbers significantly.
Alkemi Network’s co-founder, Brandon Mahoney, highlighted the importance of allowing users to keep full control of their assets, adding that this integration differed from other products in the market.
‘Not your keys, not your coins’, as the saying goes. With this native integration into Ledger Live, Alkemi Earn unlocks a protocol-powered cash management experience for Ledger’s community. This is what bridging CeFi to DeFi is all about.
Brandon Mahoney, co-founder, Alkemi Network
Ledger Holding Firm Despite Market Downturn
Despite a bleeding crypto market, Ledger continues to work on behalf of the community. Last month, it launched an NFT-focused wallet to allow users to securely store their NFTs and install up to 100 apps.
In December last year, Ledger launched the Crypto Life card, a debit card that allows users to spend crypto on goods and services or use it as collateral for cash purposes.
A new survey conducted among young adults aged 25 to 40 in the US by French investment firm Alto reveals that more millennials are investing in crypto than in mutual funds.
According to Alto’s report, titled “How Millennials See Their Financial Future”, nearly 40 percent of the survey’s millennial respondents have invested in cryptocurrencies.
Coincidentally, the same percentage of Australian millennials indicated their preference for digital assets over real estate in a similar survey conducted by international crypto exchange Kraken almost exactly a year ago.
Another survey conducted by Australian online investment broker Pearler in May 2021 indicated that “a significant number” of Aussie millennials intended to retire at the age of 50 using their investments in exchange-traded funds (ETFs) and cryptocurrencies.
Current Market Conditions Dissuade Potential Investors
The 40 percent figure mentioned in the latest Alto survey also mirrors the proportion of American millennials who own stocks. The report notes that most millennials either already own crypto or are considering buying some, though Alto founder and CEO Eric Satz concedes that current conditions make it hard for them to consider investing:
In a world of conspicuous consumption, soaring living costs, and mounting student loan debt, millennials find it difficult to invest for the future because they are struggling to afford the present.
Eric Satz, founder and CEO, Alto Investing
Seven in 10 Millennials Intend to Add Crypto to Their Retirement Funds
Participants in the Alto survey who currently hold digital assets mentioned they were likely to add more crypto to their retirement portfolios. This cohort amounted to 70 percent of millennials surveyed.
Other key findings of the Alto survey included:
74 percent of millennials thought that pouring money into the stock market should be considered gambling, whereas 70 percent were of the opinion that such actions were way too dangerous; and
76 percent believed they could essentially be left without any savings if the bears continued to reign supreme on the crypto market.
A new report from on-chain analytics firm Glassnode has described current market conditions as a “bear of historic proportions”, adding that “it can reasonably be argued that 2022 is the most significant bear market in digital asset history”:
💥JUST IN: 2022 bear market is the worst in #Bitcoin history – Glassnode
Following Glassnode’s recent report arguing we were in “the darkest phase of the bear market“, its latest release, titled “A Bear of Historic Proportions”, outlines reasons for believing that 2022 has been the worst on record for Bitcoin.
Interestingly, according to the blockchain analysis firm, the bear market commenced in April 2021 and not November 2021, since “a large proportion of the marginal buyers and sellers were flushed from the market”. It adds that bear market lows typically have drawdowns between -75 percent and -84 percent from the all-time high (ATH), taking between 260 and 410 days.
With the current drawdown reaching -73.3 percent below the November 2021 ATH, Glassnode concludes that “this bear market is now firmly within historical norms and magnitude”:
BTC drawdown from ATH. Source: Glassnode
Mayer Multiple in Rare Territory
One of the clearest signs of a bear market is when the spot price of bitcoin drops below the 200-day moving average (MA) and, in seldom seen cases, below the 200-week MA.
To illustrate, Glassnode uses the Mayer Multiple (MM), a metric used to identify bear and bull markets. Simply put, when prices are below the 200-day MA it signifies a bear market, and when above the 200-day MA, a bull market. Currently, bitcoin’s price of around US$20,000 is at a very rare level, given that it is below half the 200-day MA:
BTC price falls below 0.5 MM for the first time since 2015. Source: Glassnode
Glassnode comments that falling below 0.5 MM is an extraordinarily rare event which hasn’t happened since 2015:
Only 84 out of 4160 trading days (2 percent) have recorded a closing MM value below 0.5. For the first time in history, the 2021-22 cycle has recorded a lower MM value (0.487) than the previous cycle’s low (0.511).
Glassnode report
Realised Price, Another Bear Signal
In addition to the MM, Glassnode also notes that Bitcoin’s spot price is trading below “Realised Price”, a valuation metric calculated by taking the value of all bitcoins and the price they were bought, divided by the number of bitcoins in circulation.
Glassnode notes that the current discount to Realised Price suggests that sellers are offloading their coins at a loss. This too is an uncommon phenomenon, as spot price has only traded below Realised Price five times since Bitcoin’s launch:
Spot prices are currently trading at an 11.3 percent discount to the realised price, signifying that the average market participant is now underwater on their position.
Glassnode report
BTC realised prices. Source: Glassnode
To highlight the severity of current market conditions, Glassnode concludes by saying that the “deviation from the MA is so large that only 2 percent of trading days have been worse off”. A bear market of historic proportions indeed. Then again, it’s all a matter of context:
BTC fear and greed index December 2020 vs June 2022. Source: Documenting Bitcoin
Let’s take a closer look at today’s altcoins showing breakout signals. We’ll explain what the coin is, then dive into the trading charts and provide some analysis to help you decide.
1. IOTA (MIOTA)
IOTA is a distributed ledger with one big difference – it isn’t actually a blockchain. Instead, its proprietary technology is known as Tangle, a system of nodes that confirm transactions. The foundation behind the platform says this offers far greater speeds than conventional blockchains, and an ideal footprint for the ever-expanding Internet of Things ecosystem.
IOTA Price Analysis
At the time of writing, IOTA is ranked the 55th cryptocurrency globally and the current price is US$0.2712. Let’s take a look at the chart below for price analysis:
After a 70% decline during Q2, IOTA has ranged between $0.2633 and $0.3503. The recent rally was approaching probable resistance near $0.4045 but could be aiming for stops above the relatively equal highs near $0.4320. Continuation of the bullish move could target the daily gap near $0.4835.
Aggressive bulls might add to positions near $0.2740 and $0.2644. Price action near $0.2460 may be more likely to provide support – if the price reaches it – during any retracements.
Relatively equal lows clustered around $0.2235 seem likely to be swept if the bearish trend resumes. If this move occurs, the price may find support at the significant higher-timeframe level near $0.1955.
2. Quant (QNT)
Quant QNT launched with the goal of connecting blockchains and networks on a global scale, without reducing the efficiency and interoperability of the network. It is the first project to solve the interoperability problem through the creation of the first blockchain operating system. The main aim of Quant – using Overledger – is to bridge the gap that exists between different blockchains. The backbone of the project is the Overledger network, which Quant bills as the ecosystem on which the future digital economy ecosystem will be built.
QNT Price Analysis
At the time of writing, QNT is ranked the 63rd cryptocurrency globally and the current price is US$53.27. Let’s take a look at the chart below for price analysis:
Q1 marked a turning point for QNT, with the price gaining almost 60% from its lows to probable resistance beginning near $146.30.
The price is currently struggling with the area between $48.80 and $60.33. This region could provide support after a close above, or resistance after a close below.
A retracement could reach into the daily gap and possible support around $45.41. A more bearish shift in the marketplace will likely aim for the relatively equal lows near $42.65, and the potential support just below that begins around $39.34.
Continuation to the upside will likely target the monthly high near $66.19. However, probable resistance beginning at $72.77 and $80.30 could cap or slow down this move.
3. TrueFi (TRU)
TrueFi TRU is a protocol for creating interest-bearing pools with a high APR for liquidity providers. TrueFi includes utility and rewards mechanisms using TrustTokens and rewards participants for maintaining stable, high APRs. TRU is the native token of the TrueFi protocol and TrustToken holders ultimately have a say over who is a credible borrower in the prediction market. TRU gives the holder the ability to rate credit for third parties.
TRU Price Analysis
At the time of writing, TRU is ranked the 429th cryptocurrency globally and the current price is US$0.06499. Let’s take a look at the chart below for price analysis:
TRU‘s chart paints a different picture than many other altcoins, with April’s high leading to a massive range before setting a low near $0.05655 in June.
The nearly 36% spike at the beginning of June makes immediate bids questionable. However, the price may be finding support near $0.06016 and possibly near $0.05742. Since the price swept the impulse’s high at $0.07536, bulls might be waiting to enter near the swing low and gap near $0.05260, or slightly lower near $0.04790.
Little resistance lies overhead, although some resistance might exist between $0.06995 and approximately $0.07417, just above the current price. A sweep and rejection of the high near $0.08345 would make most areas of possible support highly suspect and could mark the end of the bullish trend.
These coins have high liquidity on Binance Exchange, so that could help with trading on AUD/USDT/BTC pairs. And if you’re looking at buying and HODLing cryptos, then Swyftx Exchange is an easy-to-use popular choice in Australia.
