The Bitcoin bulls are bashful, instead of a CBDC, the United Kingdom confirms plans to regulate stablecoins, and the Luna Foundation Guard looks to compensate their smallest holders.
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Let’s get it! In bullfighting, when a bull sees red, it violently charges forward with full force. Right now, I can’t say the same about the bulls in crypto. Normally in a downtrend, there will be at least one or two green candles on the way down. Am I right? Unfortunately, now, Bitcoin has closed seven consecutive red candles for the first time in Bitcoin’s history. For an indication on how the markets reacted to the Fed increasing their interest rates, the first of those seven red candles is printed shortly after the first interest hike. It’s been a slippery slope ever since. They’ll be continuing to raise the basis points at every one of the remaining five Fed meetings this year. It’s not looking great for altcoins either as the Tether dominance, despite the wobble, has been green for seven weeks and Bitcoin dominance has been over 44% since May 12. As the bulls fight to get back above the $30,000 level, the conversation at the macro level will continue in Switzerland at the World Economic Forum this upcoming weekend. Now, a glimmer of hope in the short term is that we could be looking at an oversold rally as Bitcoin long positions spike 60% on Bitfinex. A glimmer of hope for the long term is that Meta has adopted Bitcoin since their own stablecoin Libra has failed.
Let’s jump in and do a little market watch. We’ve got Bitcoin coming in at $29,839. Down about 5% for the day Ethereum coming in at $2,022 Down about 5.5% for the day Let’s go ahead and check our top losers. UST down 28% on the day, 84% on the week Absolutely murdered! AR down about 20% on the day THORChain down about 15% on the day Fantom down about 15% on the day And Gala down about 14% on the day Guys, as far as Bitcoin, we’re getting mixed signals. There’s some bearish signals popping up on the higher hourly timeframes. However, the 2-hour is looking very, very bullish. So we are getting mixed signals. I can see this going either way. Maybe we get a short-term pump before those higher hourly timeframes play out in a bearish way. Or maybe we just start coming down. Now, we’ll have to see what happens.
Stablecoin legislation in the UK
The United Kingdom is passing a new financial services and markets bill to strengthen their economy. It turns out that Her Majesty and her Treasury isn’t just bullish on crypto but on stablecoins as well. A spokesperson for the Queen stated, “Legislation to regulate stablecoins, where used as a means of payment, will be part of the Financial Services and Markets Bill.” This legislation will make the UK the first country in history to legally greenlight stablecoins. The UK government has noted that they will only work with collateral-backed stablecoins like Tether and USDC and not algorithmic stablecoins like UST. This has all come to light since UK Chancellor Rishi Sunak stated back in April that he wants UK to become a global hub for crypto asset technology. Sunak sees what crypto is capable of and even tasked the Royal Mint to drop NFTs by summertime. The story that broke today shows that the UK is serious about crypto. They’re moving right along with their plans since Grayscale is listing a crypto ETF that will go live on the London Stock Exchange tomorrow. To be clear, the Bloomberg Grayscale Future of Finance Index ETF is not tied to the price of Bitcoin, but a basket of crypto asset companies such as Coinbase, Robinhood and Block Inc. cryptopotato.com points out this is the first time an American digital asset manager has launched a fund in Europe. The ETF will be available in the UK, Germany and Italy.
Bullish news for the global adaptation of crypto and the future of finance. After the massive shakeup last week, the Luna Foundation Guard did everything in their power to attempt to save the peg for their failed algorithmic stablecoin UST. In a last ditch effort to save the peg, they sold over 33,000 Bitcoin for just over 1 billion UST. Unfortunately, their UST stablecoin that stood strong at $1 not long ago is now trading for around 5¢. Just nine days ago, the LFG had over 80,000 Bitcoin. Now, there’s only 313 left along with their dwindled BNB, AVAX and UST holdings. The remaining LUNA is staked by validators on their network. Although the method of distribution is yet to be determined, the LFG decided to use the rest of their assets to compensate the remaining users of UST, starting with the smallest holders first. As noble as these efforts are, it doesn’t make up for the flood of negative attention stablecoins have received in the US. The US government plans to regulate all stablecoins by the end of the year, algorithmic or not. It’s much more likely we see a CBDC opposed to the UK’s holistic approach.
This article is a transcription of a video made by BitBoy Crypto
Original video: https://youtu.be/GgZrp2C13WE