Weekly Crypto Wrap: 27th July 2023

Congratulations to the final winners of our $50k Bitcoin Giveaway!

We are thrilled to announce this week's winners, each will receive $5,000 worth of Bitcoin deposited directly into their BTC Markets account.

Congratulations to:

• Winner #9 Brodie from TAS.
• Winner #10 from NSW.

They join our other winners, Christina, Harrison, and Stephan from New South Wales. Jai, Andy and Samuel from Victoria and Blake from Queensland. Our week 4 winner from South Australia has yet to claim their prize.

For further details please visit ‘BTC Markets $50,000 Bitcoin giveaway’.

CEOs corner

It’s a wrap! We gave away $50,000 in Bitcoin to our clients to celebrate our 10th anniversary.

‘A massive thank you goes out to all our loyal clients who participated in our $50,000 Bitcoin Giveaway to celebrate our 10-year anniversary. Your unwavering support has been the backbone of our success throughout the past decade. We couldn't have reached this milestone without you, and we are committed to continuing this incredible journey together.

At BTC Markets, we will always strive to bring you cutting-edge innovations, seamless trading experiences, and exciting opportunities. As we move into the next chapter, we look forward to serving you with even greater dedication and passion.

Once again, congratulations to our lucky winners and a heartfelt thank you to all who joined our celebrations.’

Caroline Bowler, CEO

BTC Markets

Follow me on Twitter and LinkedIn.

TLDR

• BTC Markets submission to the Senate on the Digital Assets Bill 2023.
• Could Bitcoin reach new highs before the 2024 halving?
• Australia's Consumer Price Index (CPI) comes in at 6.0%.
• US Fed raises interest rates, hinting at further hikes in the future.
• US$116 million in ETH moves after eight years.
• Avalanche Foundation revolutionises tokenisation.

Regulation Roundup

BTC Markets submission to the Senate on the Digital Assets (Market Regulation) Bill 2023.

Earlier this week, BTC Markets CEO, Caroline Bowler submitted comments to the Senate Legislative Committee into the Digital Assets (Market Regulation) Bill 2023. She emphasised the significance of regulatory clarity for exchanges like BTC Markets to make informed decisions about future investments in Australia. Her testimony further highlighted the need for Australia to keep pace with global regulatory developments, ensuring a conducive environment for cryptocurrency businesses to thrive and contribute to the country's digital asset ecosystem.

BTC Markets appeared alongside other high-profile exchanges and businesses in the digital asset space and their collective feedback aims to shed light on the current state of regulations in Australia. Industry participants are advocating for the establishment of appropriate and forward-looking measures in the crypto industry.

Australian Senator Andrew Bragg introduced the bill into to the parliament aiming to establish a licensing regime for cryptocurrency exchanges in Australia. The bill, known as the Digital Assets (Market Regulation) Bill 2023, seeks to regulate exchanges, custody services, and the issuance of stablecoins. It aims to address the regulatory uncertainty surrounding the crypto industry, which has become a key concern amid the recent legal actions taken by US regulators against major crypto exchanges Binance and Coinbase. The bill proposes minimum capital requirements, governance procedures, customer fund segregation, and security measures to enhance investor protection and promote responsible practices in the crypto sector.

Watch Caroline's comments to the Senate here.

BTC Markets announcements

Clever Women Co. Podcast with Caroline Bowler.

The Clever Women Co. Podcast recently featured a captivating conversation with BTC Markets CEO, Caroline Bowler. As the first female CEO of a cryptocurrency exchange in Australia, Caroline shares her fascinating journey from the financial industry to the world of digital assets, dating back to 2015.

Join hosts Gal and Em as they delve into her career trajectory and gain valuable insights on the exciting future of cryptocurrencies. If you're curious about the evolving landscape of digital assets and the inspiring success story from inside the crypto space, then this podcast episode is a must-listen.

Listen now on Spotify or Apple.

Want to transfer your crypto from Binance to your BTC Markets account?

For clients who have been asking, we have created a comprehensive guide on transferring your cryptocurrency from Binance to your BTC Markets account. Follow our step-by-step instructions to ensure a seamless transfer process.

2022-2023 Tax Reports now available.

Log in to download your 2022-2023 tax reports (EOFY Wallet Balance and FY Transaction History) from the Reports for Tax section of your account.

You can also take advantage of exclusive BTC Markets customer discounts with a number of the industry-leading crypto tax specialists: Koinly, Crypto tax Calculator, Syla and Vault Accounting.

If you couldn't join us for our live tax webinar featuring our CEO Caroline Bowler and Koinly's Head of Tax, Danny Talwar, don't worry you can watch the recorded session on YouTube.

If you have any questions regarding tax or API/csv integrations with third party tax providers, please see our tax help article.

State of crypto

Despite a slew of positive market events, Bitcoin (BTC) has been unable to break through the US$32,000 resistance level, possibly due to investor cautiousness regarding the interest rate hike by the U.S. Federal Reserve this week.

This month’s price surge across the crypto market, driven by BlackRock's Bitcoin ETF application and the favourable ruling on XRP had raised hopes for continued institutional investment. However, the market has remained calm as investors seem to be waiting on the sidelines, and as a result, Bitcoin's price has been range bound.

At the weekly close on Monday, Bitcoin’s price held steady at US$30,083, with a slight loss of 0.49%. Ethereum (ETH) followed suit down 1.74%, closing at US$1,888. XRP saw a 1.12% loss on the week closing at US$0.7384 whilst Litecoin (LTC) managed to close barely in the green with a 0.29% gain closing the week at US$93.16. Cardano (ADA) also closed in the green registering a 0.79% gain at US$0.3171.

Bitcoin's market capitalisation clung on to a slight gain for the week with a 0.07% gain, and dominance closing at 50.15%. The overall cryptocurrency market capitalisation came off, down 0.56%, closing the week at US$1.166 trillion as investors look to take profits ahead of anticipated hawkish moves from the Federal Reserve.

As we assess the year-to-date performance, XRP remains the top performer of 2023, boasting an impressive gain of 109.32%. Bitcoin secures the second position with a solid 77.34% gain. Ethereum in third place with a respectable increase of 56.34%, while Litecoin follows closely with a 29.57% gain. Lastly, Cardano holds onto a 24.57% gain.

*The weekly trading stats as of Monday, July 24th at 10:00 am AEST, based on data from Tradingview in USD.

The week ahead: upcoming economic events

July 27th: Germany's GfK Consumer Climate Indicator. Euro Area Interest Rate announcement. US Quarterly GDP Growth Rate and Monthly Durable Goods Orders.

July 28th: Japan Interest Rate announcement. France GDP Annual Growth Rate and Inflation Rate announcement. Germany GDP Annual Growth Rate and Inflation Rate. United States Monthly Core Pce Price Index, Personal Spending, and Personal Income reports due out.

July 31st: China NBS Manufacturing PMI. Italy GDP Annual Growth Rate and Inflation Rate. Euro Area GDP Growth Rate and Inflation Rate.

Aug 1st: China Caixin Manufacturing PMI. Australia Interest Rate announcement.

Aug 2nd: United States ISM Purchasing Managers Index (PMI) and Job Openings report.

Aug 3rd: Australia Balance of Trade. Germany Balance of Trade. United Kingdom Interest Rate announcement.

Economic Calendar (tradingeconomics.com)

Market reflections

Australia

Australia's annual Consumer Price Index (CPI) came in at 6.0%, which is a decline from the previous quarter, indicating two consecutive quarters of lower annual inflation. Consumer prices rose by 0.8% in the June 2023 quarter, driven by higher rents, international holiday travel costs, and new dwellings purchased by owner-occupiers. However, domestic holiday travel and accommodation, electricity, clothing accessories, and automotive fuel saw price falls. Underlying inflation measures were considered, with services inflation surpassing goods inflation for the first time since September 2021.

The monthly CPI indicator for June rose by 5.4% on the year, easing down from 5.5% in May, mainly due to increased prices for new dwellings and rents, but automotive fuel prices fell.

This month, Australia's economic landscape exhibited contrasting dynamics across key sectors. Notably, the manufacturing industry displayed a modest recovery, marking the highest reading in five months. This upturn in manufacturing production is encouraging, breaking an eight-month contractionary trend. However, the services sector witnessed a setback, signalling a contraction for the first time in four months, attributed to the repercussions of heightened interest rates impacting consumer confidence and spending behaviour.

On the employment front, the nation experienced a net gain in June, with noteworthy growth in full-time employment. Conversely, part-time employment registered a decline, highlighting a somewhat disparate employment landscape. The unemployment rate, standing at a steady 3.5%, indicates a labour market operating at historically low levels, with an associated decline in the number of unemployed individuals. Nevertheless, the labour force participation rate saw a marginal dip to 66.80% from the previous month's peak of 66.90%.

These developments have market participants speculating a reduced probability of another rate hike by the Reserve Bank of Australia.

Global

US

In July 2023, the Federal Reserve decided to raise the federal funds rate target range by 25 basis points to 5.25%-5.5%, meeting the expectations of the market. This move brought borrowing costs to their highest level since January 2001. The decision was made while considering the ongoing economic expansion, strong job gains in recent months, and persistently elevated inflation.

The policymakers also expressed their commitment to closely monitoring incoming information regarding the economic outlook. They emphasised their readiness to implement further rate hikes if any risks emerge that could hinder the achievement of their inflation and employment goals. To make well-informed decisions, officials will consider various factors, including labour market conditions, inflation pressures and expectations, and developments in the financial and international spheres. It's worth noting that the Fed resumed its tightening campaign after a pause in June, reflecting their continued efforts to manage the economic situation effectively.

Japan

In June 2023, Japan achieved a trade surplus, signalling a positive balance between its exports and imports. However, the country's year on year inflation rate of 3.3% in the same month, though higher than May's 3.2%, fell short of market expectations of 3.5%. The rise in inflation was driven by increasing costs in various sectors such as food, housing, transport, and medical care, while prices for fuel and utilities declined for the fifth consecutive month.

Germany

On the other side of the globe, Germany's manufacturing sector struggled in July 2023, as the manufacturing PMI dropped, indicating the sharpest deterioration since May 2020. Factory output, new orders, and payroll numbers all declined, leading to concerns about the industry's stability. The business climate in Germany also weakened, reflecting increased pessimism among firms and dampened expectations for the future.

United Kingdom

Meanwhile, the United Kingdom's retail sector experienced a 0.7% monthly growth in June 2023, representing three consecutive months of expansion. The surge was attributed to summer sales and favourable weather, boosting sales across food, non-food, and non-store retailing categories. However, retail trade still faced challenges, with a year-on-year decline of 1.0%, though it performed better than anticipated.

Alt action

Avalanche Foundation 'revolutionises' tokenisation by unveiling US$50m 'Avalanche Vista’.

The Avalanche Foundation has unveiled ‘Avalanche Vista.’ a bold US$50 million initiative aimed at 'revolutionising' the world of tokenisation on the Avalanche blockchain. With a focus on converting off-chain assets into on-chain tokens, this program promises to bring accessibility and democratisation to asset allocation. It goes beyond traditional real estate tokenisation, exploring a diverse array of use cases encompassing company equity, venture capital, debt instruments, intellectual property, and portfolio diversification.

The underlying vision of Avalanche Vista is to showcase the immense value of tokenisation, offering unparalleled advantages such as heightened liquidity, fractional ownership, reduced transaction costs, complete transparency, and global access for investors. Acting as an active investor, the Avalanche Foundation will carefully evaluate and purchase a wide spectrum of tokenised assets, spanning equities, credit, real estate, commodities, and blockchain-native assets like environmental, social, and governance (ESG) products and creator intellectual property.

At the core of this endeavour lies the Avalanche blockchain, supported by the innovative architecture of Subnets—custom blockchains within Avalanche that can use their own tokens for network gas fees.

Asset tokenisation is on the rise as financial giant Citi predicts tokenisation to be the next "killer use case" in the crypto space, projecting a global market cap of US$4-5 trillion by 2030. This initiative has the potential to disrupt traditional markets and financial infrastructure, paving the way for a new era of tokenised assets.

AVAX is currently trading at US$13.19.

The Big 3

Could Bitcoin reach new highs before the 2024 halving, from BlackRock ETF Demand?

Fundstrat, an investment research firm, has predicted that Bitcoin's price could surge to US$180,000 before the April 2024 halving, driven by potential demand from a BlackRock Bitcoin ETF. The firm believes the ETF could generate an additional US$100 million in daily demand for the cryptocurrency, balancing the reduced daily mining rewards post-halving. Other firms, including Standard Chartered, also project a price target of over US$100,000 for Bitcoin.

Google's Bard AI has gained attention in the crypto market for predicting Bitcoin's future after the 2024 halving. Bard suggests that Bitcoin's price could reach new highs due to factors such as the halving event, increased global adoption, and favourable regulations. However, it also cautions about potential hindrances like bear markets and emerging rival cryptocurrencies.

BlackRock's application for a Bitcoin spot ETF has reignited hopes for further approvals in the US. Despite past rejections, several high-profile Bitcoin ETF applications are pending, with industry optimism remaining high. Other countries have already approved Bitcoin ETFs, and exchange-traded notes (ETNs) are available in Europe.

Buy Bitcoin on BTC Markets.

Dormant Ethereum ICO whale moves US$116 million in ETH to an exchange after eight years.

A dormant Ethereum wallet, which participated in the Ethereum ICO in 2014, has transferred its entire balance of 61,216 ETH, worth US$116 million, to a crypto exchange. The wallet had remained inactive for eight years before the recent transaction. Ethereum's ICO was a significant event in the crypto industry, raising US$18.3 million and paving the way for other projects to conduct token sales.

The sender conducted a test transaction to ensure the transfer's accuracy, with a remarkably low transaction fee. The identity and motive of the wallet owner remain unknown, but similar moves by other whales have occurred recently.

Buy ETH now on BTC Markets.

SEC claims XRP ruling was “wrongly decided” as the token becomes the most actively traded alt coin.

The SEC hints at appealing the Ripple XRP case ruling, claiming it was "wrongly decided" and could favour their position. The dispute centres around the Howey test, determining if an instrument is an investment contract under SEC regulation. The SEC believes the judge should dismiss recent rulings related to XRP's retail sales, arguing the distinction between institutional and retail investors contradicts the Howey test. Notably, XRP now stands as the most actively traded altcoin in 2023, with more than US$150 billion in trading volume, crypto market data provider Kaiko noted on July 25.

Buy XRP now on BTC Markets.

Crypto news

New asset listing ‘Worldcoin’ under watchful eye of UK regulator.

The UK watchdog is initiating an examination of Worldcoin (WLD), the identity-verification project launched by OpenAI CEO Sam Altman. As reported on CNBC Crypto World, the move comes as concerns about data privacy and token volatility surround the project. Worldcoin's platform verifies a user's identity by scanning their iris to create personal, secure identification codes.

In response to CNBC's inquiry, Worldcoin assured they are compliant with all relevant data protection laws, including GDPR and the UK Data Protection Act. Emphasising their commitment to individual privacy, the project has implemented various privacy-centric measures, including a ‘Data Protection Impact Assessment’ and addressing requests for personal data deletion.

However, the launch of the associated crypto token, Worldcoin, was met with significant price fluctuations. Ethereum co-founder Vitalik Buterin raised concerns regarding privacy, centralisation, and security issues. Criticism also surfaced about Worldcoin's promotion in developing countries, with concerns about potential exploitation.

Amidst these challenges, the UK data watchdog's inquiry aims to delve into Worldcoin's data collection practices. Additionally, scepticism grew due to the project's association with individuals involved in controversial activities, such as Sam Bankman-Fried and Three Arrows Capital. The tokenomics and lockup period for early investors were also subjected to scrutiny.

Compliance conversations

How to identify an online scam.

As the popularity of cryptocurrencies rises, so does the risk of encountering scams. To safeguard your assets, be vigilant and familiarise yourself with these warning signs:

• Urgent calls to action: Beware of messages pressuring you to act quickly, threatening behaviour or offering too-good-to-miss opportunities.
• Personal information requests: Be cautious of any communication asking for your sensitive data, such as passwords, banking details, or device access.
• Suspicious links: Avoid clicking on links from unfamiliar or questionable sources, even if they appear to be from a trusted organisation.
• Unusual payment methods: Be cautious of requests for payment via unsecure or unconventional means like gift cards, or bank transfers.
• Altered contacts: Verify any changes in contact details from people you know, especially if they request payments to new bank accounts.
• Unsolicited financial advice: Stay away from individuals promising fast or risk-free profits through investments or schemes.
• Persistent demands: Be wary of sellers asking for additional funds due to "unforeseen circumstances," especially common in pet scams.
• Spotting fake websites: Watch out for scam websites that mimic legitimate ones but have suspicious URLs, major discounts, and poor formatting.

Stay alert, educate yourself about potential scams, and be proactive in identifying red flags. By staying vigilant, you can contribute to creating a safer crypto landscape and minimise the risks posed by malicious actors.

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Disclaimer: The information provided in this article 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 within this email. Past performance is not an indicator of future performance. We note that we may, at any time, change the characteristics of the product. The information provided is intended for recipients in Australia. This information is not to be reproduced without permission.

Prices are accurate as of 10:00 AM AEST, on 27/07/2023.