This Week in Crypto: 10th November 2022

Each week, we share insights on the latest news and moves to impact the crypto market and the broader macroeconomic landscape. Want these updates delivered straight to your inbox? Sign up here.

Bitcoin Fear and Greed Index

Bitcoin Fear and Greed Index is currently at 22/100 in the Extreme Fear zone, down 8 points from this time last week. The index reached a high of 40/100 on Sunday and a low of 22/100 today.

Update from our Chief Operating Officer

It’s a sad time for the industry and yesterday’s events clearly articulate the need for regulatory clarity in our space. BTC Markets were incredibly disappointed to learn that FTX experienced a liquidity crisis which has impacted their exchange. While developments are still fluid, we understand that Binance have indicated they will not proceed with the intent to acquire FTX.

Our industry, clients and business partners want regulatory assurances around centralised exchange custody requirements, licensing, listing criteria and education. These sureties can only come from clear, reasonable, and responsible regulation developed in partnership with industry participants such as BTC Markets.

The 2008 Global Financial Crisis saw many companies who were over exposed with leverage become unstuck and unfortunately, we have seen another example of this. At BTC Markets we believe in conservative financial management, especially in the nascent world of cryptocurrency when there are less protections for consumers.

Although the potential loss of client’s funds can create stress, our hope is that this event will force the industry to take another positive direction towards transparency and rigour. We anticipate consumers will start expecting more financial transparency from their providers. BTC Markets have been operating since 2013, we are older than Ethereum and our conservative financial management approach reflects our commitment to your financial security.

In terms of the impact on the market, this will depend on many factors currently playing out such as timelines for completing due diligence and locating emergency funding. There is no doubt the cryptocurrency community will be watching these events closely to understand and prepare for the flow on effect of these decisions.

Anna Clive - Chief Operating Officer.

A note from OTC Desk

We are finally seeing a swift expansion of volatility across the crypto markets, as mentioned in previous weeks, evident on the charts due to being in some of the lowest volatility environments in several years. Combined with this, we have some very significant fundamental factors that are now in play as outlined above in Anna’s statement. Whenever there are "unknown unknowns" affecting the market, with contrasting viewpoints and data, zooming out to gain perspective from a macro view of the charts has been beneficial.

The challenge that remains is we are now in a time where many interdependencies of risk are being exposed, and rigorously put to the test, with the full extent remaining to be seen. It begs the question, is a social channel that allows for our industry leaders to battle it out for all to see only making this worse – or bringing about an even quicker resolution? If one thing is for certain, it is that amidst immense selling pressure, traders that have patiently been waiting for lower prices, are now being rewarded.

Here on the desk, we see traders taking full advantage of the USD, with flows out of stablecoins ahead of any volatility that ensues later in the week. As we approach macro lows for most crypto assets across the board, traders are ensuring they have capital to make the most of any buying opportunities that may come.

Looking to the US, we also see a temporary decoupling in the correlation between BTC and the S&P500, as historically their positive correlation has proven to be an indicator of relative strength/weakness. Lastly, as we bring this week to a close, we once again have US CPI and Core Inflation prints being revealed tomorrow. Certainly, a time to watch the charts, as this release has provided significant price movements, specifically on BTC/AUD and ETH/AUD.

If you’re interested in opening a newly funded account, layering long-term positions on your Self-Managed Super Fund, or simply as a stablecoin offramp, our expert OTC desk can facilitate your request. Let our team source the liquidity you need to fill any positions starting at AUD $100k. Enquire here.

Eric - OTC Desk.

Crypto news

Google announce they will be running a Solana validator.

On Sunday, Google Cloud announced its support for the Solana Blockchain with the launch of a validator node, as the company further expands into Web3. The Twitter thread revealed that Google Cloud is “running a block-producing validator to participate in and validate the network” adding that they are working on bringing a “Blockchain Node Engine to the Solana chain next year” to make it “easy for anyone to launch a dedicated Solana node in the cloud” and “indexing data and bringing it to BigQuery next year to make it easier for the Solana developer ecosystem to access historical data.”

The announcement from Google Cloud follows reports from Circle that they are looking to integrate its Euro Coin (EUROC) to the Solana chain in H1 2023.

Traditional banks complete their first Defi trades on a public blockchain.

Traditional finance (TradFi) giants have completed their first live trades on a DeFi protocol. Under the supervision of the Monetary Authority of Singapore’s pilot guardian project, JP Morgan, HSBC and other global banks “conducted foreign exchange and government bond transactions against liquidity pools comprising of tokenised Singapore Government Security Bonds, Japanese Government Bonds, Japanese Yen (JPY) and Singapore Dollar (SGD).”

The trend of TradFi institutions conducting pilots in Web3 is growing rapidly, evidenced by the Bank of Korea finishing a 10-month pilot program trading remittance and NFT projects under its Central Bank Digital Currency.

It's 'Scam Awareness Week'.

November 7th to 13th is the Australian Competition & Consumer Commission’s (ACCC) ‘Scam Awareness Week’. This initiative is a great way to raise awareness of the common scams targeting consumers. To support this event, each day we have focused on the common scams that people may face and provided safety measures that can be implemented.

You can find our series of videos on our social media pages, where we have discussed phishing, two-factor authentication, investment scams, dating/romance scams and money mules.

Check out our scam awareness video series on Twitter, LinkedIn, Facebook or Instagram.

Scheduled maintenance postponed.

Due to market volatility and your feedback, we have postponed our scheduled maintenance to 15th November 2022 from 2am-8am AEDT. All our services (site and API) will be offline between 2am and 6am, and our fund processing (deposits and withdrawals) will remain offline for a further two hours until around 8am. Please refer to this blog or follow us on Twitter for updates during the maintenance period.

Staying safe - protect yourself online.

Scams are on the rise in Australia, and some of them are targeting BTC Markets clients. We want to remind you of the importance of safe online practices, so that you can avoid falling victim to these scams. The most common scams right now include fake websites and social media posts that attempt to steal your personal information.

Scammers may pose as representatives from companies that you interact with such as BTC Markets, and they use these fake sites to trick you into handing over your personal information. These sites often look like real websites with logos and addresses that make them appear like they're legitimate.

You should never give out your personal information or provide credit card information over email or social media messenger chats. We have a dedicated page on how to 'Protect Yourself Online', which we encourage you to read. Being informed and taking simple measures is the best action you can take to protect yourself and your account while online. The Australian government’s ‘Scam Watch’ website provides the latest information on how to recognise, avoid and report scams.

Disclaimer:

The information provided in this email is for general purposes only. It should not be construed as professional financial advice from BTC Markets Pty Ltd. BTC Markets is not a financial adviser, and you should consider seeking independent legal, financial, taxation or other advice to ensure that the information relates to your unique circumstances. BTC Markets is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by use of this information contained with this email. Prices are accurate as of 10:15 AM AEDT, on 10/11/2022