Dear Teroxx Community,
This week we experienced a market of digital assets, which suffered slight sell-offs.
As usual, we are also providing detailed videos for those who want to delve deeper into the subject.
Digital Asset News
The next bull market is coming sooner than expected, at least if Mark Yusko, founder and managing director of Morgan Creek Capital Management, has his way. Yusko believes the next bull run, or “crypto summer” in his description, could come as early as the second quarter of the new year. He sees loosening monetary policy by the U.S. Federal Reserve and the beginning of pricing in the next bitcoin halving as possible drivers.
While rate cuts by the U.S. central bank are likely to be a while coming for now, according to Yusko, the market is nevertheless anticipating developments to that effect in advance. A slowdown in key rate hikes or a temporary suspension alone could therefore be interpreted as a signal of a change in strategy on the part of the Federal Reserve (Fed). This, in turn, could create a certain momentum that carries risky financial products such as cryptocurrencies upwards.
“At the very least, I think it’s very likely that the Fed will signal to us that it has ‘raised enough,’ which the market will probably interpret as ‘we’re going to cut the policy rate,’ which will then cause risky financial products to explode,” as Yusko explains his logic.
In addition to a favorable monetary policy, the expert also cites the anticipatory pricing in of Bitcoin’s next halving, which will not occur until the second quarter of next year, as another catalyst for the price trend.
Finnish crypto company Membrane Finance has launched a fully euro-backed stablecoin, according to a company blog post yesterday, Feb. 2. The company has official approval from the Finnish Financial Market Authority, Fin-FSA, and states that their new “EUROe” is the “first and only stablecoin regulated in the EU.” The major U.S. crypto company Circle had launched its own euro stablecoin last June, but the so-called “Euro Coin” (EUROC) was held in custody by Silvergate Bank and was thus regulated in the United States.
Each unit of EUROe currency is covered by “at least one euro […] held in custody at a European financial institution or bank, and held by Membrane Finance here,” according to the financial services provider’s official statement.
Emergent Fidelity Technologies, a holding company owned by Sam Bankman-Fried (SBF) and based in Antigua and Barbuda, is now also filing for bankruptcy.
According to recent court documents dated Feb. 3, Emergent Fidelity Technologies has filed for Chapter 11 bankruptcy in bankruptcy court in the U.S. state of Delaware. The company was still the target of a lawsuit filed by crypto lender BlockFi in November over its ownership of 55 million shares of trading platform Robinhood.
The Robinhood shares, valued at more than $590 million as of press time, are a hot topic of contention between several parties in FTX’s case, including BlockFi, FTX creditor Yonathan Ben Shimon and Sam Bankman-Fried himself. The U.S. Department of Justice had announced on Jan. 6 that it had seized the shares in question, along with $20 million, as part of the criminal case against FTX and the bankrupt crypto exchange’s management.
So the FTX issue continues to run its circles. Even if this news no longer influences the markets, it becomes clear how deeply entangled this matter is.
Technical term of the week
Resistance zone: Describes price levels at which the majority of market participants do not place large buy orders and thus the market does not rise further. Often the price oscillates around this zone for a certain period of time until either an upswing and thus a penetration of the resistance follows or sell-offs and thus a confirmation of the resistance are the consequence.
Digital Asset Markt
Bullish outlook: Positive markets could lead Bitcoin back to its resistance at ~$25,000.
Bearish outlook: Negative markets could lead to major price declines.