Major cryptocurrencies continue to trade within recent ranges in tandem with a broadly subdued macro tone pre-key risk events.
Bitcoin was last trading near $30,500 and ethereum near $1,800, while altcoins outperform a little.
Three-quarters of US retailers plan on accepting crypto/stablecoins as payment within two years, said a Deloitte/PayPal survey.
State Of The Market
Major cryptocurrencies have for the most part continued to trade well within recent ranges on Thursday as broader markets remain in wait-and-see mode ahead of key macro risk events, including Thursday’s ECB policy announcement, Friday’s US Consumer Price Inflation data and next Wednesday’s Fed policy announcement.
Total cryptocurrency market capitalization was last just above $1.23 trillion and almost bang on its 21-Day Moving Average (at $1.233 trillion), a level which has acted as a magnet in recent days. That puts total crypto market cap around the middle of this week’s $1.18ish to $1.28ish trillion range.
In terms of notable commentary, crypto billionaire and CEO of Galaxy Digital Michael Novogratz said on Wednesday that he sees a bumpy road ahead for crypto and equity investors in the next few weeks/months. This is a view shared by many as warning signs regarding US and global economic growth continue to flash, such as this week’s poor earnings guidance from giant US retailer Target and a big downgrade to the World Bank’s global GDP growth forecasts for 2022, as revealed on Wednesday.
Weakening growth comes against the backdrop of the ongoing Russo-Ukraine war and recent Chinese lockdowns that have worsened global supply chain snags and prolonged high inflation across the globe. Indeed, the White House warned the American public this week that high inflation may persist for some time ahead of the release of Friday’s CPI figures.
However, Novogratz said he remains positive on crypto in the longer term as mass adoption continues to push forwards, with the next major rally in the space possible when a “new narrative emerges” on the macro environment and interest rates (i.e. supply catches up to demand, inflation declines, growth picks up and the Fed doesn’t have to be so hawkish).
BTC, ETH, Major Altcoins Pivot Within Recent Ranges As Markets Await Catalysts
In fitting with the broader rangebound feel to macro and crypto trading conditions in the run-up to key global economic events, bitcoin is back to trading around the $30,500 level, well within this week and recent week’s $29,000ish to $32,000ish ranges. Notably, the 21-Day Moving Average continues to offer support and, at current levels, bitcoin has a market cap of around $580 billion.
Likewise, ethereum is also sticking within this week’s ranges and is currently trading just above the $1,800 per token mark, giving it a market cap of close to $220 billion. The news that ethereum completed its merge to Proof-of-Stake (PoS) from Proof-of-Work (PoW) on the Ropsten testnet on Wednesday, touted as one of the final major hurdles before the ethereum mainnet can transition from PoW to PoS sometime later this year, failed to spur any upside in ETH/USD, which continues to look somewhat vulnerable from a technical standpoint.
Sentiment amongst most of the major altcoins is a little more upbeat, with Solana’s SOL, Cardano’s ADA, Avalanche’s AVAX and Ripple’s XRP each higher by between 1-4% in the last 24 hours according to CoinMarketCap data, though most remain within this week’s ranges, as is the case for the major coins.
Litecoin continues to trade somewhat heavier, with reports overnight suggesting five South Korean exchanges (Upbit, Bithumb, Korbit, Gopax, and Coinone) have all stopped offering LTC in wake of its recent regulation breaching privacy update. In terms of other major altcoin news, ApeCoin’s Decentralised Autonomous Organisation (DAO) voted to keep the coin on the ethereum network, despite ApeCoin developer Yuga Labs’ insistence that a move to its own chain is eventually going to be needed. APE/USD didn’t react and was last just over 2.0% in the last 24 hours.
Three-quarters of US Retailors Plan To Accept Crypto/Stablecoins Within Two Years – Deloitte/PayPal Survey
According to a new survey published by Deloitte and PayPal on Wednesday titled “Merchants Getting Ready For Crypto”, three-quarters of US retailers plan on accepting crypto or stablecoins as payment within the next two years. The survey revealed that, of the major retailers with revenues of more than $500 million per year, more than half are spending at least $1 million per year in building the required payment infrastructure to make to transition to accepting crypto. 85% of retailers said they expect crypto payments to become widespread within their industries within the next five years.
Exchange News: FTX To Continue Hiring Despite Crypto Winter, BGC Partners To Build Crypto Exchange
FTX CEO Sam Bankman-Fried said on Wednesday that he plans to continue hiring, though in a slower, more sustainable way, despite the broader so-called “crypto winter” that has seen many other exchanges halt recruitment/let employees go. “We’re going to keep pushing forward,” Bankman-Fried said, adding that FTX remains “strongly profitable”.
Elsewhere, the CEO of major global brokerage BGC Partners Howard Lutnick announced on Wednesday at a conference that the company plans to build a cryptocurrency exchange for launch by the end of 2022/early 2023. Lutnick said he was confident that BGC’s exchange would be a success, highlighting that BGC is set up well to compete with established competitors given its already advanced traditional finance (TradFi) technology and the speed of its existing platforms.
Regulatory Landscape: BIS Highlights Crypto Disadvantages Vs TradFi, NY DFS Offers Guidance For USD-backed Stablecoins
The influential Bank for International Settlements (BIS) released a new bulletin on crypto on Wednesday and highlighted a key drawback that cryptocurrencies face when compared to TradFi. BIS warned that cryptocurrency users might fragment between different blockchains as congestion results in higher gas fees.
“This leads to a system of parallel blockchains that cannot harness network effects, raising concerns about the governance and safety of the entire system”, the bank warned. The bank then highlighted the recent success of the rollout/adoption of the Pix instant payment system in Brazil, which, just one year after its launch, has seen 117 million users (67% of the country’s adult population) sign up.
Elsewhere, New York’s State Department of Financial Services (DFS) on Wednesday became the first regulator in the US to unveil regulatory guidance for USD-backed stablecoins issued by DFS-regulated entities. The new guidance states that any USD-backed stablecoin must be fully backed by reserves at the end of each business day and that all issuers must have a DFS-approved redemption policy giving stablecoin holders the right to redeem for US dollars.
The stablecoin issuers’ reserves must also be ring-fenced from its other assets/reserves and must consist of US Treasury paper or deposits at chartered institutions, with these reserves also to be subject to monthly examination by a certified public accountant. Crypto analysts suspect it won’t be too long before USD-backed stablecoins become widely adopted in the US, which should pave the way for their eventual official approval as legal tender.
