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ETFS 21Shares Crypto Monitor - 22nd June 2022

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This Week in Crypto

Soaring inflation and insolvency in some projects on DeFi sent Bitcoin briefly dipping below $18K over the weekend and Ethereum below $900. Jumping back to above the $20K and $1000 marks boosted some confidence in the market, with more than 13K wallets most likely “buying the dip” in the past week.

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Figure 1: The Increase of Wallet Addresses Holding 1 BTC or More1_dc05f53a0e.png​

Source: Glassnode

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US President Joe Biden blamed the waging financial crisis on the fact that nine foreign-owned shipping companies have been raising prices since the pandemic, making profits seven times higher than the year before. On June 15, the Federal Reserve raised interest rates by 75 basis points; the biggest rate hike in 28 years. A day after, Biden signed the “Ocean Shipping Reform Act of 2022” to crack down on industry fees and reduce inflation, at least marginally.

Key Takeaways

  • Celsius is under investigation in some states.

  • Positive signals for Bitcoin’s correction.

  • Circle unveils euro-backed stablecoin.

  • The metaverse may generate up to $5T by 2030.

  • Ethereum delays difficulty bomb, a stepping stone to the Merge.

Macro, Regulations; Spot, and Derivative Markets

Illicit crypto activities between 2021 and the first quarter of 2022 have dropped from 0.6% to 0.1%, according to data gathered by a blockchain forensics company powered by Mastercard. CipherTrace estimates that in 2020, illicit activity was between 0.62% and 0.65% of overall crypto activity, and it has now fallen to between 0.10% and 0.15% of overall activity in 2021.

Regulators in the US were also quite active last week, running investigations and taking crypto companies to court. Here’s what happened:

  • The Securities and Exchanges Commission (SEC) is reportedly investigating how major crypto exchanges are working to prevent insider trading on exchanges.

  • Elon Musk, SpaceX, and Tesla were sued for an alleged Ponzi scheme to loot $258B in Dogecoin. The plaintiff is a Dogecoin investor seeking a class-action lawsuit in the Southern District of New York against Musk and his companies for at least $86B in damages.

  • Texas, Alabama, and New Jersey are investigating Celsius Network’s decision to halt customer withdrawals, signaling the lending protocol’s probable insolvency.

On-chain Indicators

Figure 2: BTC Shewhart Chart - MA 30 Implied Volatility2_3977de2678.png​