Crypto News: BTC Crash, TRX, ZIL, BTT, Gensler Hearing & MORE!
crypto market crash major coins and tokens tumbled by more than 10 a multi-week
rally is this a standard correction
in an uptrend or a continuation
of the stablecoin uncertainty increases U.S politicians declare Congress is
starting from scratch on stablecoin regulations following
after an intense hearing with SEC chairman Gary Gensler everything youneed to know exchanges migrate overseas coinbase and Gemini established Global operations as the EU clarifies crypto regulations and Chinese Banks take on crypto clients what could this mean for the crypto Market.
apple vs Banks the world's largest tech company begins offering high yields ondeposits incentivizing even more money to flow out of small Banks how could this impact the economy and a closer look at last week's top performing cryptos and where they could be headed next all this and More in just a momentgood morning afternoon or evening thank you for tuning in my name is Guy none of
what follows his financial advice and here is the news.Crypto Market Crash last week the bottom fell out of the crypto Market the fact that stock indices like the S P 500 and the NASDAQ continued to trade sideways suggests that the cause of the crypto crash was
specific to crypto it's not clear what crypto Catalyst caused the crash whichsuggests that it was a combination of factors.for starters there were over 250 million dollars of leveraged long positions
liquidated for anyone wondering long liquidations are caused by Traders whobet that prices would go up and are forced to sell when prices start to come
down this causes prices to fall further causing more liquidations Etc accordingto liquidation data from the Block almost 200 million dollars of these long
liquidations
came from traders who bet that
btc's price would go up this would explain
why btc's price initially fell much
more compared to Major altcoins such
as eth which only started to fall a day or
two later on that note last week's
crash appears to have begun on Tuesday
the 18th of April logically it was
only after btc's price started to fall
that the Cascade of long
liquidations began it's not clear what caused that first Domino to fall but it could have been as simple as sentiment getting too bullish too much greed if you've been keeping track of the fear and greed index for crypto you'll knowthat it's been flashing Greed for a couple of weeks now.
when investors get greedy it's often a contrarian indicator to sell it's possible that some Traders took this analysis to heart and their selling kicked off The Long liquidations at the time of shooting btc's price isat the bottom end of the 27 to 29k range where it was trading one month ago if it breaks below this range the next stop.
would be the 22 to 25k range where BTC was trading earlier this year if webreak Above This range BTC will retest 31k and possibly rally to 34k this begs the question of whether last week's crash was a standard correction
or the beginning of another leg lower from a TA perspective it's not immediately clear from a fundamental perspective the fact of the matter is that cryptos won't come close to their previous highs without institutional investment regulatory uncertainty and the shutting off of crypto to Fiat ramps like silvergate Bank sen have discouraged direct crypto investment by institutions as reported by coindesk.
institutional investors have been investing indirectly in cryptocurrencies like BTC and eth through paper derivatives found on traditional exchanges like the CME the Silver Lining is that the popularity of these paper derivatives continues to rise meaning institutions are very interested Stablecoin Uncertainty Increases.
now the only thing stopping them from investing directly in the crypto Marketis regulatory uncertainty especially around stable coins that's because stable coins are how institutional investors can easily get large amounts
of money in and out of the
crypto Market hence
why stablecoin market caps are so large if you've been keeping up with our
coverage
of the ongoing crypto Crackdown in the
United States you'll know that the
hostility against stable coins has its
roots in fears that stable coins
will
compete directly with cbdc's and other
similar Technologies such as the
fed's
upcoming fed now payment system if you
watched our recent video about usdc's
debegging you'll know that stablecoin
issuers are stuck between a rock
and a hard place as a result if
they claim stable coins are used for
payments
they'll get wrecked by the FED but if
they claim stable coins are used for
crypto they'll get wrecked by the SEC
this is because SEC chairman Gary Gensler
believes that every crypto except
BTC is a security including
stable
coins now this makes no sense.
given
that there is no expectation of profit
when investing in a stable coin this
hasn't stopped the SEC from pursuing
stablecoin issuers like paxos speaking
of which Gary finally spoke before
the house Financial Services committee
last week I say finally because the last time Gary
had testified
to
U.S politicians about the sec's activities
was way back in October 2021. not
surprisingly most of the hearing focused
on the sec's scrutiny of cryptocurrency
now we'll be summarizing everything
that Gary said during the hearing
later this week all I'll summarize
for now is what Gary said about
stable coins in short he believes that
all cryptocurrency stable coins are
used
for crypto not payments and specifically
implied that circles usdc is not
used for payments this is significant
because Circle has been arguing that usdc is used
for payments
and
has been lobbying U.S politicians to pass
regulations that would give the FED authority
over payment stable coins this is
presumably a part of circles admitted end
game which is for usdc to become the cbdc
of the United States as it so happens circles
Chief strategy officer and other
pro-stablecoin personalities testified to
the house Financial Services
Committee just 24 hours after Gary did
obviously the topic was stablecoin regulations
what was said was even more eye-opening
than what was said during Gary's
testimony so all I'll
summarize
now is what was said by Maxine Waters
and other Democrat politicians in short
Congress is starting from scratch on
stablecoin regulations meaning they won't
become law anytime soon this means that
stablecoin issuers will continue to face
scrutiny and Regulatory uncertainty for
the foreseeable future all the witnesses stressed
that continued scrutiny and
uncertainty will drive stablecoin
development overseas and stablecoin issuers
aren't the only ones leaving the United
States.
Exchanges Migrate Overseas coinbase the largest and
best known U.S crypto exchange recently confirmed that it will be launching an
offshore cryptocurrency
exchange as soon as this week now coinbase initially announced it would be looking to launch
an offshore Exchange
in mid-march presumably in response to scrutiny Iran's staking for context the SEC sued the
Kraken cryptocurrency
Exchange in February over
its staking Services which
the regulator claimed
were unregistered Securities
offerings although
coinbase had already been
facing SEC scrutiny the staking
Crackdown seems to have
been the straw that
broke the camel's back regardless coinbase's upcoming offshore exchange could be a bullish or
bearish sign
it could be bullish
because it will likely
increase coinbase's overall profits which could improve investor sentiment for crypto in
general it could be
bearish though because it would mean more crypto capital and liquidity moving offshore and it didn't take
long for others
to follow suit as Gemini also announced that it will be launching an offshore crypto exchange
interestingly trading
will take place against Gemini's own stablecoin gusd this could take market share from tether's
usdt which is used
mainly for trading two Gemini's credit co-founder Cameron Winklevoss
realized back in February
that the next crypto
Bull Run will be driven by
countries in East Asia and
is positioning
Gemini to benefit from this I'll be doing a deep dive into the countries that could drive
the next crypto
bull market tomorrow so stay tuned now as some of you may have heard the European Union finally
approved the markets
in crypto assets or Mica regulation I say finally because the final vote was postponed
twice due to supposed
translation issues I suspect it.
had more to do with pressure
from the United
States but let's not go there now if you've watched any of our videos about Mica you'll know that
it's basically
the first comprehensive regulatory
framework for cryptocurrency anywhere in the world more importantly the micro regulation
provides clear definitions
for different types of cryptocurrencies
and their regulatory requirements
Mica also specifies that these rules and regulations do not apply to truly decentralized
cryptocurrencies and
protocols this means that defy will continue to thrive on the continent at least until D5 specific
regulations are introduced
which is only a matter of time as for Mica it goes into 4 course
in 2025.
now
in theory there should have been a waterfall
of institutional investment
after
Mica was finalized in practice though
we saw a waterfall of prices
instead
now this doesn't make much sense.
Until
you realize that Mica includes a provision
which effectively bans USD
stable
coins like tethers usdt and even circles
usdc fortunately both stablecoin
issuers
also offer Euro stable coins unfortunately
it's not guaranteed that
these
stablecoin issuers will be able to effectively
compete with European Banks offering
Euro stable coins of Their Own it's
also not guaranteed that European banks
will be comfortable working with stablecoin
issuers as a not so fun fact hesitation
from the banking sector has been
an even bigger hurdle for the crypto
industry than crypto regulations,
this
is why the news of Chinese Banks providing
banking services to crypto
companies
in Hong Kong is so significant simply
passing Pro crypto regulations is not
enough passing pro-crypto
regulations may also.
Apple vs. Banks
not
be enough to motivate institutions to
invest in the industry even if
banking
services are no issue that's because
For the first time in a long
time
institutions can earn four percent interest
on their cash and this rate
will
continue to rise as the FED continues
to raise interest rates now
any
American viewers will know that you won't
get this four percent interest
rate
at the bank that's because Banks make
money by investing their customer
deposits in assets most banks are investing customer deposits in these same interest rate instruments and giving the customers only a fraction of the total gains as time goes on the average depositor is becoming ever more aware of this and they're starting to wonder if it's worth it to move some or all their excess cash to somewhere where it will earn a yield.
now
to my understanding the biggest hurdle
to this has been the process it
can
be complicated well apple is hyper aware
of how complicated these kinds of
things can be lo and behold
simplification is literally the unique value
proposition of the company while this simplification has so far been focused on Computing hardware and software Apple seems to be expanding into Financial Services with its latest product Apple's high yield savings account allows Apple card holders in the United States to earn a whopping 4.15 on.
their savings with zero
fees and no minimum
balance or deposit requirements this product was of course made possible thanks to a partnership with
Goldman
Sachs one of the biggest
banks this means
that almost 140 million Americans
have the ability to
seamlessly transfer their
money from their regular bank
accounts to Apple with a
few clicks of a button I reckon it's safe to assume
that many Apple
users are wealthier than the average American meaning Apple users
probably have most of the
money if you watched
our video about the recent banking crisis you'll know that it was caused by Banks being unable
to honor customer
withdrawals because they had invested customer deposits in assets that either couldn't be
easily sold or couldn't
be sold for the initial purchase
price these
so-called unrealized losses aren't an issue unless everyone rushes to withdraw at the same time
which is exactly
what we saw with Silicon Valley Bank what's been happening since then is a slow drip of deposits out of
mostly small
and medium-sized Banks into big Banks and Apple's savings account could.
accelerate this means that we could start to
see more small
Banks go under in the coming months this could do even more damage to the already battered
commercial real estate
sector if you watched our video about that you'll know that small Banks issued most of the existing
commercial real
estate loans you'll
also note that lots of commercial real estate loans have been purchased by so-called Shadow Banks such
as private investment
firms like Blackstone and can you guess who's been giving Blackstone,
the money to buy
commercial real estate loans
that's right you have via your
pension as always well U.S
Regulators seem to
be aware of what's coming the financial stability oversight Council recently proposed a rule
that would
allow them to designate non-banks
as systemically
important this
will give them the ability to protect the assets of non-bank entities such as Blackstone if they
go down this is the
same way that U.S Regulators were able to legally protect customer
deposits at svb and
Signature Bank when they
went down it will also likely
result in the same
response a massive expansion
of the fed's balance sheet
which could cause the
crypto Market to pump but
at what cost.
and so
this brings me to the section Top Performing Cryptos that many
of you have missed and that's last week's top performing
cryptos I want to start by drawing your attention to the
eth BTC chart because it's something that gives you a sense
of how
well
altcoins are doing in general and where they could be headed next
well eth
is struggling
to get above 0.07 BTC on the weekly chart and was rejected
at
that
level last week this is consistent with the monthlchart for East
BTC which shows a continued downtrend eth and altcoin weakness
now this doesn't mean we
couldn't
see eth and altcoin strength in the short term however anyway
last week's top performing cryptos were silica BitTorrent
Oona said Leo render Network and Tron eclectic let's
just say that so starting with silica the zilcoin appears
to have pumped in response to the Project's recent evm
compatibility upgrade which will be put on full display
at coindesk's consensus conference this week this could mean zil
will
continue to Rally but it faces significant resistance around 4
cents sowatch that level next up we have BitTorrent the BTT token appears
to have pumped in response to the release of btfs
storage 3 a decentralized storage.
Network
powered by BTT the release seems to have caused a massive
spike in btt's price on binance though these gains have since
been erased BTT appears to be in a strong long-term
downtrend now I can't say I'm familiar enough with the project
to make a call on whether btfs storage 3 will be enough to
reverse this downtrend as for una said Leo there isn't much to say
that's because Leo is bitfinex's exchange token this means that
Leo's price is ultimately dependent on what bitfinex
is doing if I were to guess Leo pumped because of the spike in
trading
volumes
on bitfinex driven by last week's liquidations regarding
render Network meanwhile the render token appears to have
rallied in response to a past governance proposal that will
expand the project to the Solana blockchain it makes sense
that.
the
proposal passed given that render network has the same investors as
Solana
including
the now disgraced Alameda research believe it or not but
render is
looking
pretty bullish it's broken out of its lows and seems to be
setting up
for
another rally this assumes that what I'm looking at on the daily
chart isn't a double top which could be the case considering the excitement
of the Solana migration has likely been priced in and finally
we have Tron whose TRX or Tronics coin appears
to have pumped because of the Project's involvement in the nft
NYC
event
which took place earlier this month in contrast to render Tronix
is looking pretty bearish the weekly chart reveals a
massive descending triangle which could break up or down if
it breaks up Tronics will Moon the fact
that Tronics continues to bash against the bottom range of the
triangle suggests it will break down that would
not be
pretty
