This Week in Crypto: 24th November 2022

Caroline Bowler
Nov 24th 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.

Headline: Bitcoin Fear & Greed Index

Bitcoin Fear and Greed Index
is currently at 20/100 in the Extreme Fear zone, returning to the same level from this time last week. The index reached a high of 24/100 on Sunday and a low of 20/100 today.

Audit Update from BTC Markets

We understand that in the current environment clients are seeking authoritative information regarding how we manage customer assets and our own business.

To provide transparency and further peace of mind to our clients, we are working with an external cryptocurrency auditor to provide proof of reserve reporting, this will be available in the coming weeks.

We appreciate your patience while we work through this, and in the meantime, we have reached out to our external auditors JTP Assurance*, for a statement: 

BTC Markets Pty Ltd does not currently have any external debt or other material loans or liabilities other than ordinary trade payables. JTP Assurance have audited BTC Markets financial statements since June 2020. We have completed our audit for 2021 and are currently in the process of auditing 2022.” - JTP Assurance

BTC Markets remains a Blockchain Australia Certified Digital Currency Exchange and is committed to the best practices outlined in the code of conduct, listed here.

BTC Markets is the oldest Australian based exchange that fulfils all the following:

  • Segregates client assets and maintains a 1:1 ratio of client’s assets on our exchange
  • Provides onshore custody of all client assets
  • Does not lend out client's assets or offer an earn function
  • Does not have a proprietary trading desk
  • Does not have an exchange token
  • Has stringent KYC/AML processes as well as an ISO certification.

We will continue to work with regulators to develop legislation and compliance measures that protects consumers, whilst ensuring the growth and innovation of blockchain technology.

*JTP Assurance is an independent external auditing firm appointed as the company’s auditor since June 2020.

Market reflections 

The events over the past couple of weeks have continued to reverberate across the digital asset space. Market participants have appeared to be in a ‘wait and see’ mode as they attempt to make sense of the broader market implications and additional fallout regarding FTX. 

Bitcoin consolidated around the US$16k-17k range last week but lost a key level of support on Sunday retracing 5.5% when on chain data showed the “FTX hacker” was moving funds around, causing a sell off. Bitcoin soon rebounded and is now trading at US$16.5k (at time of publication). Both ETH and XRP followed suit initially losing ground over the weekend but are slowly recovering to levels of support. Total crypto market cap pulled back –0.54% this week and is currently at US$794 billion.
Regulation news

Where sentiment was temporarily dampened on the short-term, positive momentum and institutional activity has continued in the background. RBA Governor, Philip Lowe stated that “inflation will peak later this year at around 8 per cent, and then decline gradually over the next couple of years to be a little above 3 per cent by the end of 2024." In his speech on ‘Price Stability, the Supply Side and Prosperity’ at the 2022 Annual CEDA dinner in Melbourne, he provided an insight into supply side factors that will affect inflation.

In the US, details from the November Federal Open Market Committee (FOMC) meeting were released showing the FED acknowledged “the need to slow the pace of increase in the target range for the federal funds rate” which saw a positive reaction from the wider markets. Powell’s subsequent press conference indicated, “the ultimate level of interest rates will be higher than previously expected.”

State of crypto

The Australian division of FTX was placed into administration two weeks ago with Korda Mentha appointed as Voluntary Administrators for FTX Australia Pty Ltd and FTX Express Pty Ltd. The designation allows Korda Mentha to review company records and determine the most appropriate course of action. 

John J. Ray III was appointed CEO of FTX to administer all liquidation processes concerning the US Chapter 11 bankruptcy proceedings. With over 40 years of legal and restructuring experience, including Enron, Residential Capital, and Nortel, Ray’s statements reiterated the need for corporate governance and controls. 

As an industry, we believe that recent events are not a failure of blockchain and its underlying technology. They do, however, reinforce the need for improved regulation, consumer protections, and adherence to best practices. 

At BTC Markets, our clients’ interests are at the forefront of everything we do. We keep your assets secure and provide you with peace of mind when transacting on our exchange.

Crypto news

Australian Bitcoin miners Arkon Energy secures AUD$28 million in expansion funding. 

Arkon Energy has generated AUD$28 million in capital to fund an expansion of its Bitcoin mining operations and acquire the Norwegian data centre, Hydrokraft. Arkon Energy is a Sydney-based start-up that utilises low-cost renewable energy to mine Bitcoin. 

The firm raised an initial AUD$2.6 million in pre-seed round funding in February 2022 and has sustained its business operations despite a depreciating crypto market. Other competitors in the US have not been as fortunate. Iris Energy defaulted on their equipment loans and Mawson Infrastructure Group has faced delisting on the NASDAQ.

A point of difference for Arkon Energy is their focus on renewable energy. In a recent statement, Arkon Energy commented, “The Hydrokraft purchase is part of an ambitious plan to create a vertically integrated green Bitcoin mining platform that has power sovereignty, benefits from geographic diversification, and a robust balance sheet.”

Patents have been approved for crypto focused ‘JP Morgan Wallet.’

America's largest bank, JP Morgan Chase has been granted a patent for their cryptocurrency wallet, ‘JP Morgan Wallet.’ The filing was approved on November 15th and made public on November 21st. The patent addresses an extensive range of provisions, including cryptocurrency payment processing, electronic transfer of virtual currencies via online communities, and various credit transaction services. 

JP Morgan has exhibited sustained interest in Web3, the metaverse, and digital asset innovations. They were the first bank to host an experience in Decentraland, and in January published a paper forecasting the metaverse as an annual US$1 trillion-dollar market opportunity.

Brazil’s largest bank offers clients crypto custody. 

The largest commercial bank in Latin America has started offering crypto custody to their clients. Brazilian bank, Banco Itaú which has US$400 billion assets under management announced their crypto custody project will be going live in Q2 2023. The bank will provide custody services over two phases, initially to existing customers and then to third parties.

Brazil has been renowned for its usage of cryptocurrencies, ranking 7th in Chainalysis’ Global Cryptocurrency Adoption Index. Banco Itaú is yet to confirm which digital assets will be included in the custody program. In July 2022, Banco Itaú introduced an asset tokenisation platform which enabled clients to trade tokenised traditional finance products on the banks exchange.

Similar projects have been implemented, such as the Monetary Authority of Singapore (MAS) who conducted ‘Project Guardian’ in November 2022. The project involved JP Morgan, DSB and other major banking players trading tokenised assets on a public blockchain. More information regarding this event can be found here.

BTC Markets Updates

Our new look is live! 

We are excited to announce that BTC Markets has rolled out the new brand assets on our website and mobile app. After years of focusing on developing and delivering a world class trading experience and exceptional customer service to our clients, we are now taking the next step in the evolutionary phase of our business by uplifting the look and feel of our brand.

Over the past few months, our team have fully dedicated themselves to detailed research, planning and implementation of new brand colours, fonts and messaging that aligns with our brand mission and vision. Although we are changing our look, the core values that drives our company and culture will remain as steadfast as ever.

Check out our new look!  

BTC Markets partners with Trust Pilot.

To streamline our online review process and ensure we are responding to your feedback efficiently, BTC Markets has partnered with Trust Pilot to introduce an online review program over the next few weeks.

Shortly, you may receive an email invitation from [email protected] asking you to rate your experience with BTC Markets and provide feedback. We encourage you to be as honest and transparent as possible, as all feedback helps us to improve the quality of our products and services to you.

In the past, we have told you not to click on unsolicited emails, so we wanted to prepare you for the Trust Pilot email that maybe coming to your inbox. Below is an example of what the email will look like.

As always, if you have any questions, please reach out to our Client Support Team via this link or in the Support section of our website.

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 24/11/2022. 

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