Dear Teroxx Community,
This week we saw a digital asset market which saw a negative start to the year.
Weekly overview
As usual, we are also providing detailed videos for those who want to delve deeper into the subject.
Latest crypto news
After a developer discovered hints of a stablecoin of the payment service in the PayPal app, the latter confirms corresponding plans.
Jose Fernandez da Ponte, the vice president of cryptocurrencies and digital currencies at PayPal, admits to Bloomberg News in this context:
“We are currently researching a stablecoin. In the event that we want to launch this, we are of course working closely with regulators.” Another clue to the project is provided in hindsight by an interview da Ponte gave in November 2021, when he stated that PayPal “is not yet aware of a stablecoin that is specifically designed as a payment method.”
Thus, a global payment services provider is planning renewed forays into this asset class.
Although the price trend is quite similar to January 2021, the sentiment is fundamentally different. As data from Cointelegraph Markets Pro and TradingView shows, BTC/USD trapped at $40,700 today and then subsequently rallied to above $42,000.
Although some observers are unimpressed with this price action, parallels to September of last year inevitably become apparent, when the US$40,700 level was ultimately the launch pad from which it went on a record run to a new record high of US$69,000. “It’s been a few months since September, but BTC is now in exactly the same situation as it was then in terms of the macroeconomic framework,” crypto analyst Rekt Capital said in light of the current situation. The “macroeconomic framework” means, among other things, the new direction of march of the U.S. Federal Reserve, as the “Fed” recently held out the prospect of raising the key interest rate again for the first time.
Therefore, in the last week, more and more fears were circulating that the crypto markets could be weakened without the availability of “easy money”. After all, since the beginning of the Corona crisis, monetary policy has been relatively loose and very conducive to Bitcoin & Co.
Experts believe that once this “fear” subsides, digital asset markets could recover quickly.
Sam Bankman-Fried, the successful young entrepreneur and founder of the crypto trading platform FTX, is confident that more legal clarity in the crypto industry will ensure that more and more institutional investors enter the market.
“SBF” made the relevant remarks in a recent interview with Bloomberg, in which he discussed crypto regulation, institutional adoption and Metaverse, among other topics. Despite a bumpy end to the year for crypto markets, Bankman-Fried is “optimistic” about developments in the new year:
“What makes me optimistic is that there is more and more legal clarity in the U.S. and around the world. That will totally jump-start institutional adoption.”
SBF maintained this tenor when asked about accelerating institutional adoption, as he also sees it as very dependent on “what happens in the regulatory space.”
Adaptations and regulations are the linchpin for the future development of the entire industry.
Technical term of the week
Consolidation: Describes a market situation in which individual assets do not show any major trends and tend to move sideways. Smaller sell-offs can occur at any time, but in the long term this market phase strengthens the markets and offers good opportunities for buybacks.
Crypto Market
Bitcoin and most other digital assets could not hold the levels of the turn of the year and saw setbacks. These setbacks are over 10% in some assets. Thus, there were hardly any bullish moves and the entire market is working to establish support in order to complete new upswings. The announced rate hike in the U.S. depressed investment sentiment and caused further sell-offs in the market. As a result, the overall market cap also saw a ~12% setback. At Teroxx, we take a very defensive stance in these market situations and wait for suitable trends to invest in the markets and assets.
Bullish outlook: Support stabilization between $40,000 – $42,000 would fundamentally strengthen the market and could serve for appropriate buybacks.
Bearish outlook: A loss of the support region at ~$40,000 would have a lasting negative impact on the market.
