News Updates July 27, 2022
1. Can Bitcoin hit $30,000 by the end of August? Here’s what the crypto community says.
After a difficult week for the cryptocurrency sector, during which Bitcoin (BTC) dropped below the $21,000 level due to fears of an impending interest-rate hike by the Federal Reserve, the flagship token is back above that mark, leading investors to wonder whether its price could reach the coveted $30,000 by the end of August.
As it happens, the community at CoinMarketCap has made predictions that the BTC token will not only reach the key psychological level but will actually trade at an average price of $32,493 by August 31, 2022 – using the ‘Price Estimate’ feature that allows users to speculate on the future pricing of cryptocurrencies.
With this prediction, the community votes are forecasting that the price of the decentralized finance (DeFi) asset will increase by 51.37% or $11,026 by the end of August from its value at press time.
2. Institutions Sell Off 1% Of Total Bitcoin Supply In Under 2 Months.
Bitcoin has fallen more than 70% from its all-time high in November 2021 and has triggered selling pressure with it. While it seemed that institutional investors were going to hold through the bear market, this has not been the case. Over the last couple of months, the sale of bitcoin in the open market has ramped up, and institutional investors have been revealed to have sold a large percentage of their holdings.
Institutional Investors Offload Bitcoin
The sell-offs from the institutional investors have been rocking the market, but due to the sales not being disclosed at the time of the sales, the market did not know these companies were offloading their holdings until much later.
It had started with the collapse of LUNA when the market had seen billions of dollars wiped off the market cap. This had been a big blow to the market, and investors scrambled to get out of the market. During this time, the profitability of the investment of a lot of institutions had plummeted, leading them to offload either to keep their activities going or just to prevent more losses.
3. Turkish Finance Minister meets virtually with Binance founder to discuss crypto.
Turkish Finance Minister Nureddin Nebati has confirmed holding a virtual meeting with Changpeng Zhao, the founder of the Binance crypto exchange.
Through a tweet posted on July 27, Nebati stated that the meeting centered around the blockchain ecosystem and cryptocurrencies.
Although both parties didn’t delve into the meeting’s specifics, Turkey is known to be home to many Binance customers. Data retrieved from web analysis firm Similarweb indicates that Turkey is the number one traffic source to Binance.
The meeting comes just months after Binance expanded its footprint in Turkey by opening a customer service center.
At the launch, Binance noted that the service center serves customers with 24/7 support through its app. Notably, the center is part of Binance pilot tests, and the success will likely see similar centers opened in other regions globally.
Overall, Turkey is among countries registering high cryptocurrency interest, with citizens investing in different assets to tackle skyrocketing inflation.
However, the relations between Binance and Turkey have not been rosy, with the exchange suffering the impact of the country’s recent crypto laws. In December last year, Turkish authorities slapped Binance with a fine of the maximum amount of $750,000 for failing to observe new regulations. At the time, the penalty was considered the first of its kind.
Binance was accused of failing to provide customer information related to money laundering in accordance with new laws enacted early last year.
4. Crypto Traders Split on Upcoming Fed Rate Hike's Impact on Bitcoin
The Fed has raised rates by 150 bps since March, injecting volatility into asset markets. Yet some analysts expect BTC to stay resilient after Wednesday's hike.
The U.S. Federal Reserve (Fed) will likely raise the benchmark borrowing cost by 75 basis points (0.75%) on Wednesday in a continued effort to drain liquidity to tamp down inflation. Crypto traders are split on how bitcoin (BTC) would react to the rate hike.
Griffin Ardern, a volatility trader at crypto asset management firm Blofin, foresees a bitcoin price drop after the Fed lifts rates by 75 basis points (bps) to the 2.25%-2.5% window.
Considering that the overall risk level of the crypto market has not returned to a reasonable level, it is very likely that the BTC price will drop by more than 10% after the Fed rate hike," Ardern said.
The Fed's liquidity-sucking measures, such as rate hikes and balance sheet runoffs, have roiled asset markets in the past few months. Bitcoin has declined by over 50% since the central bank kicked off the tightening cycle in March.
Bitcoin and the broader crypto market may see another relief rally following the 75 basis point rate hike after which we expect markets to trade sideways, while ether (ETH) may outperform in anticipation of the merge," according to Dick Lo, founder and CEO of quant-driven trading firm TDX Strategie.
Perhaps traditional and crypto markets have priced in the impending 75 basis points hike, with Fed officials hinting at such a move in recent weeks.
Bitcoin has dropped by 7% in the week leading up to Wednesday's Fed event. "We are seeing participants taking a risk-off approach ahead of the FOMC decision as expected," Lo responded when asked about the pre-Fed flows in the crypto market.
At press time, the Fed fund futures, derivatives based on the benchmark interest rate, put the likelihood of a 75 bps move at 75%, alongside a 25% probability of a 100 bps hike.
Trader and analyst Alex Kruger said the crypto market could see a small rally following a 75 bps rate rise but warned of a decline should the central bank surprise with a 100 basis point move. However, Fed officials had pushed back against a full percentage point hike earlier this month.
5. Unstoppable Domains Reaches Unicorn Valuation With $65M Series A Round
The Web3 startup behind NFT-based domain names is now valued at $1 billion as it expands its online identity push into reputation
* Web3 startup Unstoppable Domains has raised $65 million at a $1 billion valuation.
* The firm sells NFT-based domains that can be assigned to crypto wallets and websites, and is building Web3 identity and reputation solutions.
Unstoppable Domains, a Web3 service that provides NFT-based domain names for crypto wallets and websites, today announced that it’s reached a “unicorn” valuation of $1 billion after a $65 million Series A funding round.
The raise was led by new investor Pantera Capital and includes funding from Mayfield, Alchemy Ventures, Redbeard Ventures, Polygon, CoinGecko, OKG Investments, and others. Previous backers Draper Associates and Boost VC also took part.
Matthew Gould, founder and CEO of Unstoppable Domains, told Decrypt that “everyone’s excited” at the firm about reaching unicorn status, and that it built through the so-called crypto winter in 2018 and 2019 to eventually reach this point. But he also told his team that bringing in this kind of investment is a serious matter.
“When you take on funding, you take on a lot of responsibility,” he said. “You have one day to celebrate and take the victory lap, and have a glass of champagne—and then the next day, you get right back to work.”
Unstoppable Domains previously raised $6.9 million in VC funding across multiple rounds, including what was billed as a Series A in 2019. However, Gould told Decrypt that all earlier investment is now considered part of its seed funding, and he chalked up previous labeling to being a small startup without a PR team at the time.
Gould said that Unstoppable Domains has registered more than 2.5 million crypto domain names to date, including with extensions such as .crypto, .bitcoin, .nft, .blockchain, and .dao. Registration starts at $5 per domain and can range into the hundreds of dollars—the firm claims to have generated more than $80 million in sales so far.
Each Unstoppable Domain takes the form of an NFT asset that’s minted on Polygon, an Ethereum scaling platform that enables faster, cheaper, and more energy-efficient transactions.
6. Crypto Council for Innovation hires government insiders to build leadership team
Linda Jeng and Brett Quick will be joining the council in support of its policy and regulatory affairs team.
The Crypto Council for Innovation, or CCI, a crypto advocacy group that establishes dialogues with governments and regulatory agencies on the benefits of crypto, has hired two new experts with experience in financial regulatory policy in the United States.
In a Tuesday announcement, the CCI said Linda Jeng, a former Federal Reserve Board and Treasury Department employee, and Brett Quick, former deputy chief of staff for House Financial Services Committee chair Emeritus Spencer Bachus, would be joining the council in support of its policy and regulatory affairs team. Jeng will be the council’s chief global regulatory officer and general counsel, having previously worked in a similar role at the Circle- and Coinbase-founded Centre Consortium, while Quick will join as the CCI’s head of government affairs for North America.
Formed in April 2021, the CCI’s supporters include Coinbase, Gemini, Fidelity Digital Assets, Paradigm, Ribbit Capital, Andreessen Horowitz and Block. Sheila Warren, the former head of blockchain and distributed ledger technology at the World Economic Forum, joined the CCI as CEO in February. Since that time, the CCI announced former U.S. Senator Cory Gardner would take a position on the advocacy group’s leadership team.
According to the CCI, its current focus has been supporting lawmakers on issues related to evading sanctions using cryptocurrencies, the European Union’s Markets in Crypto-Assets (MiCA) law, which aims to harmonize regulations for crypto among EU member states, and legislation introduced concerning digital assets in the United States. Congress members in both the House of Representatives and Senate have put forth different bills on how to handle crypto-related products in the country, from stablecoins to determining where to draw the regulatory lines between the Securities and Exchange Commission and Commodity Futures Trading Commission.
The CCI hosted a virtual event in July 2021 on Bitcoin (BTC) adoption called “The ₿ Word,” featuring speakers including Tesla CEO Elon Musk and Jack Dorsey. Many other crypto policy advocate groups in the United States, including Coin Center, often weigh in on laws and regulations related to digital assets.
7. South Korean Financial Regulators Look Into Suspicious $3.2 Billion Remittances With Crypto Links
South Korean news agency Yonhap reveals in a report on Wednesday that the country’s Financial Supervisory Service (FSS) has discovered suspicious foreign exchange transactions totaling 4.1 trillion won ($3.2 billion) processed by two leading banks with ties to crypto exchanges.
Notably, the FSS is engaged in an investigation of the entire banking industry after leading banks reported suspicious large FX transactions. For example, Woori Bank earlier reported to the FSS that one of its branches processed over 800 billion won (US$617 million) in overseas transfers in the past year. With similar reports from Shinhan Bank, the regulators are looking to see if there is a criminal pattern in this suspicious string of foreign transfers.
“A probe into all banks is currently underway in reflection of worries that there could be such similar transactions,” Lee Bok-Hyun, head of the Financial Supervisory Service (FSS), reportedly said, adding that a robust task force has been created for the purpose.
According to the report, unspecified crypto exchanges are believed to be involved in the transactions. Bloomberg reports that 5 Woori bank branches processed $1.3 billion in these suspicious remittances within May and June alone. At the same time, Shinhan Bank processed about $1.9 billion from February 2021 to July this year.
At this time, investigators in the country are also looking into the events leading up to the Terra ecosystem collapse in May. As previously reported by The Crypto Basic, several exchanges and the home of Terra co-founder Daniel Shin were raided last week.
8. EU Banking Regulator Worries It Can’t Find the Staff to Regulate Crypto: Report
José Manuel Campa, chair of the European Banking Authority, told the Financial Times he is worried the agency does not yet have the capacity to supervise digital assets.
The European Union’s banking regulator is worried about how it will enforce new crypto rules that are expected to take effect by 2025, according to the Financial Times.
European Banking Authority Chair José Manuel Campa said the agency does not yet have the capacity to supervise digital assets. A major concern is hiring and retaining the specialized staff required because there is a high demand for crypto talent, he told the FT in an interview published Wednesday.
The EU recently finalized its Markets in Crypto Assets (MiCA) legislation, which has a heavy focus on stablecoins and will be applied across all 27 member nations. There is still a long journey before the details are put into law and once they are, some details will need to be fleshed out and more rules could come. Campa told the FT that in three years crypto may have "moved and transformed into other uses that I cannot anticipate."
The EBA is worried about planning the logistics of enforcing its new powers because it won’t know which cryptocurrencies it will supervise till 2025 nears, Campa told the FT.
"My concern is more about making sure the risk we have identified ... is properly managed. If we don't do as well as we should have, we'll have to live with the consequences," he said
9. Okcoin warn of ‘elder fraud’ following recovery of $1M in stolen crypto
Scammers who preyed on the elderly were stopped by the coordinated efforts of centralized exchanges.
In a recent blog post, San Francisco-based crypto exchange Okcoin warned about “elder fraud,” adding that the elderly are the highest risk group affected by online scams.
Following an investigation, the company’s risk team intercepted $1 million in stolen Ethereum and Tether and returned the tokens to the rightful owners.
How Okcoin recovered the stolen crypto
The starting point was a report from an 84-year-old user who contacted Okcoin for help after being scammed in April.
“We were scammed and they cleaned out our meager savings. […] Without it we can’t make it. Please help us. Thank you.”
Investigations revealed that the user was one of many victims who an international scam ring had targeted. Investigators estimated that the gang had netted over $4.1 million through their operations.
Critics argue that criminals prefer cryptocurrencies due to their pseudo-anonymous nature. However, in this case, Okcoin was able to monitor the scammers’ wallets using blockchain analysis.
Things came to a head when the scammers tried to launder the stolen funds by sending tokens to an unnamed centralized entity. Although not explicitly stated in the post, it’s common knowledge that centralized exchanges are in contact with one another and agree to freeze accounts suspected of criminal activity.
From there, the $1 million in ETH and USDT was recovered and returned to the victims.
Online scammers target the elderly
Quoting data from a 2021 elder fraud report conducted by the FBI, Okcoin said scammers “routinely target the elderly due to their lack of technical knowledge.”
