News Updates November 15& 16, 2022

1. Crypto Exchange Gemini Suffers $485M Rush of Outflows Amid Contagion Fears
Gemini suspended its yield-earning program, shaking users’ confidence in the exchange. Gemini, a crypto exchange and custodian founded by the Winklevoss brothers, has suffered a rush of withdrawals as crypto firms wrestle with the reverberations of the FTX-Alameda bankruptcy and subsequent contagion within the digital asset industry.
Data by blockchain intelligence platform Nansen shows that Gemini saw $485 million in net outflows in the past 24 hours, the largest among crypto exchanges. Outflows totaled $563 million, and were offset by only $78 million in inflows. In the past seven days, Gemini experienced a total of $682 million net outflows – the difference of $866 billion of inflows and $1.55 billion of inflows provided by Nansen – suggesting that most of the withdrawals have Digital asset balances on crypto wallets identified as Gemini dropped to $1.7 billion from about $2.2 billion a day ago, according to blockchain data platform Arkham Intelligence. Arkham and Nansen do not cover data from the Bitcoin blockchain and may not include all Gemini’s wallets.
 Crypto balance held in Gemini's known wallets dropped to $1.7 billion from $2.2 billion in a day. (Arkham Intelligence)
The rush of withdrawals came as Gemini paused withdrawals earlier Wednesday from its yield-generating Earn program. The lending unit of crypto investment bank Genesis Global Trading, which powered the program for Gemini, announced that it was suspending customer redemptions citing “extreme market dislocation” and “loss of industry confidence caused by the FTX implosion."

2. Privacy-Enhancing Crypto Coins Could Be Banned Under Leaked EU Plans
Crypto providers would be forbidden from touching the likes of monero or dash under proposed government amendments to anti-money laundering rules.

The European Union could ban banks and crypto providers from dealing in privacy-enhancing coins such as zcash, monero and dash under a leaked draft of a money laundering bill obtained by CoinDesk.
The plans from Czech officials, who are chairing talks among EU governments on the proposed law, would represent the latest nail in the coffin for anonymous means of payment following tough new rules agreed over the summer.
“Credit institutions, financial institutions and crypto-asset service providers shall be prohibited from keeping …anonymity-enhancing coins,” said a legislative draft seen by CoinDesk, dated Nov. 9, which has been circulated to the bloc's other 26 member states for comment.

 
The European Union could ban banks and crypto providers from dealing in privacy-enhancing coins such as zcash, monero and dash under a leaked draft of a money laundering bill obtained by CoinDesk.
The plans from Czech officials, who are chairing talks among EU governments on the proposed law, would represent the latest nail in the coffin for anonymous means of payment following tough new rules agreed over the summer.
“Credit institutions, financial institutions and crypto-asset service providers shall be prohibited from keeping …anonymity-enhancing coins,” said a legislative draft seen by CoinDesk, dated Nov. 9, which has been circulated to the bloc's other 26 member states for comment.
 
An EU diplomat told CoinDesk that the measure was intended to avoid the risk stemming from crypto assets that are specifically designed to avoid traceability. The ban on privacy coins, which prevent snooping into blockchain activity, is intended to mirror one on anonymous instruments such as bearer shares and anonymous accounts that was included in the original bill proposal.
The Czech proposal responds to a demand from countries negotiating the text, said the diplomat, who spoke on the condition of anonymity on negotiations taking place behind closed doors.

  
 
 

The European Union could ban banks and crypto providers from dealing in privacy-enhancing coins such as zcash, monero and dash under a leaked draft of a money laundering bill obtained by CoinDesk.
The plans from Czech officials, who are chairing talks among EU governments on the proposed law, would represent the latest nail in the coffin for anonymous means of payment following tough new rules agreed over the summer.
“Credit institutions, financial institutions and crypto-asset service providers shall be prohibited from keeping …anonymity-enhancing coins,” said a legislative draft seen by CoinDesk, dated Nov. 9, which has been circulated to the bloc's other 26 member states for comment.
 
An EU diplomat told CoinDesk that the measure was intended to avoid the risk stemming from crypto assets that are specifically designed to avoid traceability. The ban on privacy coins, which prevent snooping into blockchain activity, is intended to mirror one on anonymous instruments such as bearer shares and anonymous accounts that was included in the original bill proposal.
The Czech proposal responds to a demand from countries negotiating the text, said the diplomat, who spoke on the condition of anonymity on negotiations taking place behind closed doors.
 
The Anti-Money Laundering Regulation was proposed in July 2021 by the European Commission as part of a package that would also forbid large cash transactions and create a new anti-money laundering agency, AMLA, to vet practices at large financial institutions.
Under the Czech plans, crypto asset providers would be obliged to verify customers' identity even for occasional transactions of under 1,000 euros ($1,040), and to probe the nature and purpose of the business for larger payments. That would make rules more onerous than for other kinds of firms such as banks, where due diligence rules only kick in for larger payments, apparently due to fears that crypto payments can easily be broken up into smaller chunks.

3. El Salvador to Purchase Bitcoin Everyday from Tomorrow
El Salvador's decision to buy one Bitcoin daily comes at a time when the country has been undergoing several financial uncertainty.

In the latest development, El Salvador Nayib Bukele announced that they will resume their Bitcoin purchases once again. In his recent tweet, President Nayib Bukele wrote: “We are buying one Bitcoin every day starting tomorrow”. However, he hasn’t suggested how long they will continue with this buying program. 

El Salvador’s Bitcoin Law came into effect last year on September 7, 2021. The country has acquired nearly $375 million worth of Bitcoins, however, has been sitting at more than $60 million in unrealized paper losses.

President Nayib Bukele has been the biggest proponent of Bitcoin and believes that the crypto would be good for the country’s financial health. Furthermore, he has gone against all odds for their Bitcoin bet despite repetitive warnings from the IMF and the World Bank to withdraw from their Bitcoin bet.

The last year’s BTC price decline has certainly been a deadly blow for El Salvador. The unfolding of the FTX episode over the last week has also put BTC under huge selling pressure. But it seems that President Nayib Bukele has amassed enough confidence to take a long-term bet on fresh Bitcoin purchases.

4. Bulls Need to Dive in and Invalidate the Choppy Waters on BTC. 
 
According to analysis, BTC has been in a downward trend, which may persist.
Bitcoin is facing stiff resistance at its intraday high of $17,051.96.
BTC bulls must keep on fighting to wrap up bear dominance.
Bitcoin (BTC) has seen an ambivalent market trend as bears and bulls compete to seize market control. However, the bulls were annihilated in recent hours, as prices fell by 2.25% to $16,594.90.

This negative market trend is chalked up to a 1.55% decrement in market capitalization to $318,562,851,315 and a 12.38% drop in 24-hour trading volume to $34,898,693,505.

The BTC market is experiencing escalating selling pressure, with the Bollinger Bands widening as the upper band touches 17064.52 and the lower band touches 16548.12. The bearish engulfing candlestick pattern gives credence to this bearish trend.

With a reading of -2.56, the Coppock curve is trending south, denoting that bear supremacy is on the form.

Investors are optimistic because a Stoch RSI reading of 0.00 indicates an oversold region and anticipates a bullish reversal in the near term. Still, it is only partially certain that prices will revert higher.

MACD in the negative territory denotes that the bears have a firmer grip on BTC prices. As of press time, the MACD blue line was moving below the signal line, with a reading of -52.55 propping up this downward trajectory. The histogram trend in the negative territory also reinforces the notion that bear dominance will continue.

On the 1-hour price chart, the Relative Strength Index (RSI) is 33.45 and points south, approaching the oversold region. This RSI trend indicates that bulls are fatigued and that bearish hegemony is expected in the near term.

When the Elder Force Index tumbles below the “0” line, bearish market sentiment is projected, as shown on the BTC chart, where the EFI is -611.755k.

If the bulls can hold the resistance level despite several indicators pointing to another bear run, the digital currency may see a bullish reversal.

5. Will SBF face consequences for mismanaging FTX? Don’t count on it
Lawmakers, regulators and even the institutional media don’t seem to have much interest in faulting SBF for using customer money to trade under the table.

Will former FTX CEO Sam Bankman-Fried be held accountable for his mismanagement of investor funds?

After most of the entities tied to his cryptocurrency exchange became insolvent last week, blockchain analysts concluded the insolvencies came as a partial result of the exchange’s trading house, Alameda Research, burning through nearly $10 billion in cash that technically belonged to FTX customers. To date, the company has declined to elaborate on the contractual details that made the arrangement possible — or legal.

In the aftermath of FTX’s collapse, skeptics have questioned whether the elite — in Washington or elsewhere — will be motivated to investigate the situation with any rigor. Tesla, SpaceX and Twitter CEO Elon Musk suggested in a Nov. 13 tweet that he was among those critics, sharing an image that ties Bankman-Fried — also known as “SBF” — to Securities and Exchange Commission Chair Gary Gensler. Bankman-Fried is a graduate of the Massachusetts Institute of Technology, the image notes, where Gensler served as a professor. And he’s been romantically linked to Alameda Research CEO Caroline Ellison, a Stanford graduate whose father, Glenn Ellison, also teaches at MIT.