News updates April 26, 2022

1. Bitcoin Recovers Above $40K After Dipping Earlier to 6-Week Low:
Bitcoin is trading at about $40,100 after falling nearly to $38,200.

Bitcoin (BTC), after a big price swing over the past week, traded earlier Monday at its lowest point in almost six weeks.
As of press time the largest cryptocurrency by market capitalization was up 1.3% in the past 24 hours, trading at $40,127. Earlier, the bitcoin price fell as low as $38,202, the lowest since March 15

* Recent volatility has been driven by factors such as inflation, the Ukraine crisis [caused by Russia’s invasion] as well as contractionary monetary policies,” said Daniel Khoo, research analyst at Nansen. “This has affected not only the stock market but also the crypto market, which seems to follow in tandem recently

* Khoo said this fall in prices could be driven by the short-term negative sentiment as people go risk-off on volatile assets.

* “Many investors are also shifting towards [stablecoins] given the uncertainty and short-term bearish outlook as the market has become too hot and periods of extreme euphoria were followed by market corrections historically,” Khoo said

* The crypto markets tumbled this morning, as bitcoin failed to hold the $40K level,” wrote Marcus Sotiriou, analyst at the U.K.-based digital asset broker GlobalBlock. “Fears about a 50-basis point rate hike have strengthened after Federal Reserve Chairman Jerome Powell’s comments last Thursday.”

* Powell said Thursday that “it is appropriate, in my view, to be moving a little more quickly.” He said raising the benchmark U.S. interest rate by 50 basis points (0.5 percentage point) “will be on the table” for the next Federal Open Markets Committee (FOMC) meeting in May, in remarks at the International Monetary Fund debate.

* “Even though we have a more hawkish Federal Reserve which could lead to more pain for global markets in the short term,” said Sotiriou, “I am still cautiously bullish

* Bitcoin’s on-chain metrics are contrastingly bullish,” wrote Sotiriou. “Data from Glassnode shows that the percentage of bitcoin’s supply that has not moved in one year is at an all-time high. I think this data tells us that whilst these macro headwinds are ongoing, bitcoin is being distributed from those who see it as a risk-on asset, to long-term holders who have strong conviction in bitcoin’s long-term potential.”

* Ether (ETH) was up 0.87% in the past 24 hours, trading at $2,972.

• U.S. stocks were mixed as China’s COVID-19 restrictions stiffened, with the S&P 500 down 0.7% and the Nasdaq up 0.2%.

2. Bitcoin hits $40K, investors pump DOGE after Musk confirms Twitter purchase:

Markets took a turn for the better after BTC reclaimed $40,000, and the excitement over Elon Musk buying Twitter translated to a 20% pump for DOGE price.

The cryptocurrency market fell under pressure in the early trading hours on April 25, but a brief spurt of bullish price action sparked after media headlines announced that Elon Musk had reached a deal to purchase Twitter for $44 billion. 

Data from Cointelegraph Markets Pro and TradingView shows that after dropping as low as $38,210 in the opening trading hours on April 25, Bitcoin (BTC) price staged a 5.72% rally to hit an intraday high at $40,366 as news of Twitter’s sale spread across news outlets.

 *Declining exchange reserves point to strong accumulation*

The recent bearish sentiment that has dominated the crypto market was addressed by crypto trader and pseudonymous Twitter user Phoenix, who posted the following chart showing the decline in Bitcoin held on crypto exchanges, indicating that it points toward a strong accumulation phase.

 *Bitcoin is still bullish according to historical macro cycle bottoms*

On-chain data firm Whalemap suggests that while the current correction is not over, a “generational bottom” is on the horizon and as the chart shows, buying these events tend to be very profitable for investors.

The market is unwarranted at the current levels or the bull market outlook is still strong. Alternatively, one could infer that the market could be in for a real gut punch if the current weakness culminates with a final flush out to the sub-$20,000 region.

3. Bitcoin Overcomes Hurdles, Why BTC Could Regain Momentum:

Bitcoin extended decline and tested the $38,200 zone against the US Dollar. BTC started a major recovery wave and climbed above the $40,000 resistance.

* Bitcoin extended decline, but it remained stable above the $38,000 level.

* The price is now back above below $40,000 and the 100 hourly simple moving average.

* There was a break above a major bearish trend line with resistance near $39,550 on the hourly chart of the BTC/USD pair (data feed from Kraken)

* The pair is eyeing more upsides above the $40,500 and $40,950 resistance levels.

 *Bitcoin Price Recovers Sharply*

Bitcoin price remained in a bearish zone after it broke the $39,200 support. BTC extended decline below the $38,500 level, but the bulls were active near the $38,200 level.

A low was formed near $38,200 and the price started a major increase. The price climbed higher above the $39,200 and $39,500 resistance levels. There was a move above the 23.6% Fib retracement level of the key decline from the $42,950 swing high to $38,200 low.

Besides, there was a break above a major bearish trend line with resistance near $39,550 on the hourly chart of the BTC/USD pair. Bitcoin is now back above below $40,000 and the 100 hourly simple moving average.

An immediate resistance on the upside is near the $40,550 level. It is near the 50% Fib retracement level of the key decline from the $42,950 swing high to $38,200 low. The next key resistance could be $40,950. If there is a clear move above the $40,950 and $41,000 levels, the price could continue to rise.

In the stated case, the price could even surpass the $41,200 resistance. The next major resistance may perhaps be near the $41,800 zone.

 *Dips Supported in BTC?*
If bitcoin fails to clear the $41,000 resistance zone, it could start a downside correction. An immediate support on the downside is near the $40,000 level.

The next major support is seen near the $39,800 level and the 100 hourly simple moving average. A close below the $39,800 support zone might start another decline. In the stated case, the price might decline to $39,000.

4.   2 Europeans Charged With Conspiracy in Virgil Griffith's North Korea Crypto Sanctions Case:

Earlier this month, Griffith, an Ethereum developer, was sentenced to five years in prison for helping North Korea evade sanctions with crypto.

Federal prosecutors on Monday announced charges against two Europeans who allegedly conspired with Virgil Griffith to help North Korea use crypto to evade sanctions.
Alejandro Cao de Benos, a Spainard, and British citizen Christopher Emms provided information about cryptocurrency to attendees of the 2019 Pyongyang Blockchain and Cryptocurrency Conference, according to a press release from the U.S. attorney's office of the Southern District of New York.
The charges follow Ethereum developer Griffith’s sentencing to five years in prison earlier this month and come as the U.S. government is paying more attention to North Korea's brazen alleged hacks of crypto projects worldwide.

The United States will not allow the North Korean regime to use cryptocurrency to evade global sanctions designed to thwart its goals of nuclear proliferation and regional destabilization,” Assistant Attorney General Matthew G. Olsen said in the press release.
The Department of Justice didn't immediately respond to a request for comment.

5. More Crypto Regulation May Be on the Way in Mexico, Suggests Central Bank Chief:

The Governor of the Bank of Mexico (Banxico) has spelled out its position on crypto – and has hinted that it may seek to expand the scope of its regulation of the sector.

In a report from Forbes Mexico, the Governor, Victoria Rodríguez Ceja, was quoted as telling the Senate that she and her team were “analyzing” the need to “regulate” the “use of cryptocurrencies” in order to “provide protection to people who use digital assets.”

The Governor added that “the use of cryptocurrencies” was “not supported by the Bank of Mexico,” but added that citizens had the “freedom to carry out operations with these digital assets.” But, Rodríguez Ceja noted, firms in the sector must abide by “certain obligations to prevent money laundering.”

She stressed in answer to a question from a Senator that "cryptocurrencies are assets that are not backed by Banxico. They are not legal tender.”

Senator Noé Castañón, from the Movimiento Ciudadano Party, asked the bank chief to bolster regulation governing the use of cryptoassets, claiming that their adoption now could not “be stopped.”

Rodríguez Ceja has previously stated that the bank will roll out a digital currency by no later than 2025.

6. Only 5.3% of Spanish Crypto Investors Have Received a Warning to Declare Income Taxes:

Only 5.3% of Spanish crypto investors have received a warning to declare income taxes, according to a report in local media. If accurate, this would mean that only 233,000 investors, a minuscule portion of the estimated 4.4 million Spanish citizens that have delved into the crypto world with investment ideas in mind, were contacted by the tax agency.

 *Spanish Tax Agency Falls Flat on Crypto Vigilance*

Only a small portion of cryptocurrency investors and users in Spain have been contacted by the national tax agency in regards to their crypto operations from last year. The organization managed to send warnings to only 5.3% of the estimated number of Spanish citizens that have invested or made transactions with cryptocurrency, according to a report from local media.

This means that only 233,000 investors of 4.4 million have been warned about their duty of declaring cryptocurrencies using the income tax and holdings models. While this fails to include a significant part of the total of investors in the country, it represents a significant milestone for the agency, which has increased the number of this kind of warning roughly 16 times, going from 14,800 issued in 2021.

 *Spaniards Still Unsure*

Even with all of this, some say the average Spanish citizen receiving one of these warnings does not know how to act to declare cryptocurrency operations. For this task, the tax agency has explicitly created two special sections to declare cryptocurrency tax income and heritage.

On this, Enrique Garcia, CEO and co-founder of Taxdown, a company that processes online income tax statements, declared:

During this tax season, only cryptocurrency holders that have purchased and sold cryptocurrency assets need to present these records to the tax agency. Users that have only purchased and held their cryptocurrencies won’t have to pay taxes on the assets.

Spain has been busy when it comes to legislating how cryptocurrencies must be taxed. The Spanish Treasury Minister admitted in March that cryptocurrencies should not be declared under Model 720, a designation that has to do with funds held abroad. This model was rendered illegal by the EU due to its elevated penalties and had to be changed.

7.   Mastercard’s Head of Crypto Not Concerned About Threat From Blockchain Technology

Recently, Raj Dhamodharan, Executive Vice President of Blockchain / Digital Asset Products and Digital Partnerships at Mastercard, explained why his firm does not fear blockchain technology and cryptocurrency as threats to his firm’s principal business.

8. Macron’s Re-election Could Boost Unified Euro Crypto Regulation, 'European Metaverse'

For France’s crypto industry, Emmanuel Macron's re-election for another five-year term may mean that Paris will oppose measures to hamper crypto innovation at the European Union level, but also that France will push for the creation of a “European metaverse.”

9. Ukraine Doubles Down on Crypto-Friendly Regulation Efforts, Aims for Top Spot

Ukraine is aiming to become a top 5 country in the world in terms of crypto legislation, and the efforts have the “total support” of both President Volodymyr Zelenskyy and the government, according to a high-ranking Ukrainian government official.

The deputy minister further said that the plan to place Ukraine among the leading countries in the world when it comes to crypto has the full support of the Ukrainian government.

Moreover, Bornyakov pointed to non-fungible tokens (NFTs) as an area of particular interest to himself and the government. He said that the government believes one of the purposes of NFTs and the blockchain is to document history, and opined that this is especially important as Russia “tries to erase our history.”