News updates February 20, 2022
1. Bitcoin Fighting At Critical Support Ahead of the Weekly Close: BTC Price Analysis
After bitcoin’s move towards $45K turned into a fakeout as BTC got sharply rejected, the recent price action turned short-term bearish, with a critical level to watch at $40K.
The uncertainty and the low liquidity status in the crypto markets have led to a volatile period that is also highly correlated with the global markets. Fundamentals such as the Ukraine – Russia conflict affect both global and the crypto markets.
* Bullish: BTC consolidates around the $40K area and breaks above the blue trendline. If the price bounces off the present level, bulls have to push the price above the 20 and 50-day moving averages. In that case, we can expect a break above last week’s high at $45.8K.
* Bearish: BTC will break down below the yellow trendline and the support area, heading towards lower levels. Given the values of the RSI, there is much room for bitcoin to decline and form a new local low, which will also create a lower low (bearish trajectory).
Futures Market Analysis
The recent significant surge towards $45K has re-established optimism across the market. The consequencing FOMO led many speculators to enter high-leverage long positions.
Then, the price got rejected at the $45K level yet again and had seen a quick 12% drop over the previous three days. This resulted in another cascade of long liquidations.
In addition to the massive liquidations event, based on price action patterns, many technical analysts identified the $41K – $42K zone as support, meaning that many stop losses were set below this level. As a result, when BTC fell below this level, a wave of stop losses was triggered, intensifying the bearish trend.
2. Web3 might be crypto’s key to the mainstream market
Decentralization vs. centralization: Web3 may be right around the corner, but the race for central crypto regulation is also speeding up
2021 has been a significant year for crypto with no fungible token (NFT) being awarded word of the year, decentralized finance (DeFi) trending in the mainstream media and crypto companies making headlines for a variety of announcements. This is, no doubt, in part due to the effects that COVID-19 has had on the economy, with many looking for new ways to diversify their finances and a move to working from home giving people the free time to research new interests. And, many chose to get involved in crypto.
As conversations began to move on from Bitcoin (BTC) to other larger crypto projects like Ethereum network upgrades and central bank digital currencies, or CBDCs, news coverage would suggest that the mainstream adoption of crypto is already well underway. However, there is one project which could have the ability to catapult crypto well and truly into everyone’s day-to-day lives: Web3
What is Web3?
With an emphasis on community, Web3 represents the future of the internet where users operate in a decentralized way rather than relying on large private businesses or centralized government bodies.
To many, this seems like the next logical step for the internet, where the concept is partially built on the shortcomings of Web 1.0 and 2.0 such as the concentration of power within centralized entities and issues relating to privacy.
3. European Union Open to Crypto, Says Home Affairs Commissioner. Europe is not against cryptocurrencies, according to Home Affairs Commissioner.
Regulation is important to minimize fraud, she says.
FTX CEO Sam Bankman-Fried argued that crypto exchanges have strengthened oversight processes. European Union Commissioner for Home Affairs said that the European Union is open to digital assets in the presence of fraud-preventing regulation.
4. Crypto Exchange Bitget Signed a Sponsorship Deal With Soccer Team Galatasaray
The Turkish Galatasaray is the next soccer club that Bitget strikes a sponsorship agreement with.
The Singapore-based cryptocurrency platform became an official sponsor of the Turkish soccer club Galatasaray. The latter will feature the company as its crypto partner on multiple platforms and media assets.
1) Bitget Attracted Another Soccer Team
The most successful soccer club in Turkey – Galatasaray – inked a sponsorship agreement with Bitget for the remainder of the 2021-22 season. The platform will also serve as an official cryptocurrency partner of Galatasaray’s basketball squad.
Bitget’s CEO – Sandra Lou – praised Turkey as a leader in the digital asset sector. In her view, the nation has shown “great interest” and “continues to lead education sharing opportunities in this field.”
Commenting on the collaboration was also Galatasaray’s Vice President – Bikem Kanik. She explained that the club chose Bitget because of its leading position in the industry. It also “fits our vision,” the exec added.
Bitget put its name next to other prominent companies that serve as Galatasaray’s backers. These include Nike, Sixt, Turkish Airlines, Burger King, and more.
2) Similar to other sectors, diving into the digital asset industry has become a trend among soccer teams. In August last year, the Italian AC Milan teamed up with BitMEX to introduce the latter as its Official Sleeve Partner and Official Cryptocurrency Partner.
A few months later, the Argentine Football Association (AFA) collaborated with Bybit. The trading venue will serve as the Global Main Sponsor of all selections until November 2023.
The most successful English soccer club – Manchester United – also joined the club by shaking hands with Tezos. As a result of the $27 million deal, the “Red Devils” will put the blockchain platform’s logo on its training apparel. Manchester United has already started promoting the marketing initiative on its club’s center.Other Soccer Clubs That Joined The Crypto Ecosystem.
5. Clarity pushed back: Russian government fails to forge a consolidated stance on crypto regulation
Another tentative deadline for the Finance Ministry and central bank to reach a compromise passes as an expected bill does not arrive.
On Feb. 18, the Russian Ministry of Finance kicked off public consultations on the rules of cryptocurrency issuance and transactions. While a welcome development, it is less than the country’s crypto space had expected to get. Earlier in the week, the government announced that by Feb. 18, a bill containing the finance ministry and central bank’s consolidated position on crypto regulation would be drafted. Updated estimates suggest that it will take at least another month for draft legislation to see the light. The main reason for the delay appears to be the central bank’s renewed resistance, which just several days ago seemed to have been overcome. Here is a roundup of the latest twists in this rocky ride.
Round 1: Central bank’s ban proposal
On Jan. 20, the Central Bank of Russia (CBR) issued a report summarizing its position on digital assets. Using a variety of the usual anti-crypto arguments, such as comparing digital assets to a Ponzi scheme, the regulator called for a complete domestic ban on using traditional financial infrastructure for crypto trading, as well as for curbing crypto mining in the country.
The proposal was a little less scary than it sounds: The CBR didn’t intend to outlaw individual possession of crypto or the use of international platforms for trading. But the measure was clearly aimed at big players — Russian private banks and institutional investors — discouraging them from any involvement in digital assets.
Moreover, the report immediately drew harsh criticism from the widest possible range of stakeholders, from local industry players to political activists and influencers such as Telegram’s Pavel Durov. But more importantly, the denunciation from several other important offices of the Russian government immediately followed.
On Jan. 25, Ivan Chebeskov, head of the Finance Ministry’s Department of Financial Policy, stated that the ministry’s position on digital assets is one of regulation, not prohibition, and asserted that it had already been working on its own regulatory document.
Round 2: Finance Ministry’s proposed framework
On Feb. 8, the Russian government approved the “Framework for regulating the mechanisms of digital currencies circulation” — a document that had been published earlier by the Finance Ministry. This was an unexpected, yet favorable, turn of events: The document proposes a regulatory regime that would largely view digital assets as regular currencies. It was also implied that the government’s approval meant that the CBR’s concerns were settled. Feb. 18 was announced as the date by which the bill, reflecting the two bodies’ reconciled position, would be ready.
The framework opens by brushing off the idea of a blanket ban. According to the ministry, the ban wouldn’t be feasible or practical in a country with more than 12 million crypto wallets — and more than $26 billion worth of digital assets held in them — and the world’s third-biggest crypto mining capacity:
Round 3: The CBR’s about-face
Rejoicing over the two key regulatory players’ compromise, however, might have been premature. On Feb. 15, CBR Governor Elvira Nabiullina doubled down on the regulator’s opposition to the proposed legalization of crypto trading. The statement came simultaneously with the report on the progress the CBR had been making on its central bank digital currency.
Nabiullina also sent a letter to Finance Minister Anton Siluanov in which she reiterated her “crypto is a Ponzi scheme” concerns. She maintained that institutional support of crypto circulation would create “an illusion of state protection” among investors, who would seek help from the government should the crypto market collapse. Basically, the letter repeats the arguments and propositions of the CBR’s January report.
6. Bitcoin (BTC) Treads Water as Markets Eye News on Russia. Bitcoin (BTC) ended a 3-day losing streak on Saturday. The upside was modest, however, as geopolitics continued to peg back Bitcoin and the broader market. News updates on Russia and a possible invasion of the Ukraine left Bitcoin range-bound on the day. Following a 1.36% fall on Friday, Bitcoin rose by 0.28% to end the day at $40,107. It was a mixed session for the rest of the crypto top 10, however.
Avalanche (AVAX) joined Bitcoin in the green, rising by 1.51%, with Solana (SOL) and Cardano (ADA) rising by 1.58% and by 0.10% respectively. Terra (LUNA) also avoided the red, rising by 0.49%, with Ripple (XRP) rallying by 4.85%. Ethereum (ETH) ended the day down by 0.56%.
7. OpenSea Investigating ‘Exploit Rumors’ as Users Complain of Missing NFTs
Emails purporting to be from the NFT marketplace about a planned smart contract migration may have been a phishing attack. We are actively investigating rumors of an exploit associated with OpenSea related smart contracts,” OpenSea posted to Twitter Saturday night U.S. hours. “This appears to be a phishing attack originating outside of OpenSea's website. Do not click links outside of opensea.io.”
Around 10:50 p.m. ET, OpenSea CEO Devin Finzer followed up in a tweet that “32 users thus far have signed a malicious payload from an attacker, and some of their NFTs were stolen.” He added that the company is “not aware of any recent phishing emails that have been sent to users,” and suggested a fraudulent website may be to blame.
