- According to the latest statements in the Federal Reserve
meeting minutes, policymakers at the Fed’s September monetary policy meeting unanimously agreed that high interest rates should be maintained ‘for some time.’ - On Thursday, G20 finance ministers and central bank governors approved a roadmap for an effective, flexible, and coordinated policy framework for crypto assets.
- A statement verified by Bitmain employees on October 8th indicated that Bitmain reported that the company’s operating cash flow had not yet turned positive for September.
This past week has been challenging for Bitcoin investors, although it has remained relatively stable; What events will investors focus on this week: Here are the details!
What Happened Last Week? Extended summary!
While last week was relatively calm for Bitcoin and cryptocurrencies in general, the Bitcoin price failed to hold above $27,000. However, BTC showed resilience as it started the new week, rising to $27,200. Let’s take a look at what happened last week and what investors should focus on this week.
Federal Meeting Minutes: Most Officials Believe Another Rate Hike Is Appropriate
According to the recent statements in the Federal Reserve meeting minutes on October 12th, policymakers at the Fed’s September monetary policy meeting unanimously agreed that high interest rates should be maintained ‘for some time’ and advocated for a ‘careful approach’ to interest rate decisions. As for whether further rate hikes are necessary, while most participants believed it would be appropriate to raise interest rates further at future meetings, some members expressed the view that additional rate hikes may not be necessary.
U.S. CPI Rose 3.7% Year-on-Year in September
The unadjusted U.S. Consumer Price Index (CPI) data for September showed a year-on-year increase of 3.7%, slightly exceeding expectations of 3.6% but matching the previous month’s 3.7% figure. The core CPI for September (excluding volatile food and energy prices) stood at 4.1% year-on-year, in line with expectations and down from the previous month’s 4.3%. The ongoing moderation in core price increases, coupled with softening wage gains and rising bond yields, could lead Federal Reserve policymakers to reconsider the necessity of rate hikes this year, according to Nick Timiraos of The Wall Street Journal.
G20 Releases Roadmap for Crypto Asset Regulation
On Thursday, G20 finance ministers and central bank governors approved a roadmap for an effective, flexible, and coordinated policy framework for crypto assets. This roadmap is based on a consolidated document containing recommendations from the International Monetary Fund (IMF) and the Financial Stability Board (FSB). The FSB recommended regulatory oversight of crypto assets to prevent them from endangering macroeconomic and financial stability.
UK FCA Warns About HTX and KuCoin
On October 8th, the UK Financial Conduct Authority (FCA) added 143 firms, including Huobi/HTX and KuCoin, to its warning list of firms that customers should avoid. Firms conducting crypto asset activities in the UK are required to register with the FCA or obtain temporary registration, or they may face penalties. In August of this year, the FCA reported that it had received 291 registration applications since 2020, with only 38 approved. Among the approved companies were Bitstamp, Revolut, and Gemini. Earlier, in September, Bybit had suspended all its services in the UK.
ESMA Publishes Document on “Decentralized Finance: Classification of Smart Contracts”
On October 13th, the European Securities and Markets Authority (ESMA) published a document titled “Decentralized Finance (DeFi) Classification of Smart Contracts.” This document states that, although the forthcoming MiCA regulation does not directly regulate DeFi, the interdependency of smart contracts with LEGO-like features may potentially make them vulnerable to contamination. The increasing complexity of smart contracts and the adoption of more sophisticated technology have turned DeFi characteristics into regulatory concerns.
Binance Weekly Summary
- Binance Freezes Crypto Accounts Linked to Hamas: On October 10th, Israeli police froze crypto accounts associated with Hamas. Israel’s Lahav 433 police department took action against these accounts, which are linked to the country’s Ministry of Defense and intelligence agencies in collaboration with Binance, and the seized funds will go to the Israeli treasury. Israeli authorities had previously seized approximately 190 Binance accounts on suspicion of being associated with terrorist organizations since 2021.
- Binance Co-Founder Responds to Freezing of Hamas-Linked Accounts: On October 10th, Binance’s co-founder He Yi responded to the freezing of Hamas-linked accounts, stating that the United Nations currently classifies Hamas as a terrorist organization. He stressed that when they receive any requests to freeze such accounts, international organizations, banks, and trading platforms should cooperate. This implies that it’s not a matter of taking a political stance, but rather that no trading platform has the ability to refuse such a request.
- Brazilian Congress Proposes Investigating Four Binance Executives: According to Bloomberg on October 11th, the Brazilian congress has accused four senior Binance executives, including CEO CZ, of corruption. The committee suggests that the Federal Prosecutor’s Office should approach Binance’s local division for compliance review, recommend that the Brazilian Securities and Exchange Commission (CVM) stop and desist any activity involving the sale of Binance’s securities derivatives, and review Binance’s compliance. The decision on whether the allegations will be taken to court will be made by Brazilian authorities.
- Bloomberg: Binance Founder’s $1 Billion Plan to Rescue Crypto Industry Quietly Fails: According to Bloomberg on October 10th, CZ initiated the “Industry Rescue Initiative” (IRI) last November after FTX’s bankruptcy to provide funding for promising industry startups. The analysis of public digital asset wallets associated with this project shows that the “Industry Rescue Initiative” has distributed less than $30 million since its inception. Among nine publicly identified participants, only one committed all of the funds they pledged. A Binance spokesperson confirmed that the IRI had funded 14 projects but did not disclose the names of these projects or specific funding amounts. Binance has since returned the $985 million promised to the IRI funds to the company’s finances.
Bitmain Partially Delays September Salary Payments Due to Cash Flow Issues
An announcement verified by Bitmain employees on October 8th indicated that Bitmain reported that the company’s operating cash flow had not yet turned positive for September. Progress in the mining division, in particular, led to significantly lower-than-expected distributions of mining machines to mining facilities. As a result, Bitmain’s management team decided to temporarily defer partial salary payments for all employees for September. The reconsideration of salary payments was scheduled for October 7th after the holiday.
Deribit Plans to Launch Options Contracts for Solana, XRP, and Polygon
Luuk Strijers, Chief Business Development Officer of Deribit, announced on October 9th that Deribit, the world’s largest crypto options exchange, would start offering options trading for Solana (SOL), Ripple (XRP), and Polygon (MATIC) from January next year. The introduction of options for these three altcoins is expected to increase volatility. Deribit also plans to apply for a brokerage license in the European Union and is considering relocating its headquarters to Dubai. Once licensed, Deribit plans to hire 12 additional staff, in addition to its existing 115 employees.
FTX Weekly Summary
- Caroline Ellison Claims to Be President of SBF in the United States: On October 11th, Caroline Ellison, the former CEO of Alameda Research, testified in court, claiming that she was directed by SBF to carry out certain crimes. She alleged that Alameda misused customer funds for investment and political donations. Despite being appointed as the CEO of Alameda Research, she claimed she still reported to SBF and that Alameda had only a small stake in FTX, meaning that SBF has the ability to borrow as much debt as possible and wanted to acquire more FTT tokens.
- Caroline Ellison: Alameda Paid $100 Million in Bribes to Release Frozen Funds on Chinese Exchanges: According to BitMEX Research on October 12th, Alameda Research’s trading accounts in both original Huobi and OKX exchanges were frozen in 2021. They hired lawyers to unlock these accounts, tried various trading strategies, and attempted to bribe Chinese government officials. In November 2021, Alameda Research paid approximately $100 million to release the accounts. This money was divided into multiple parts and sent to various cryptocurrency wallet addresses. According to Caroline Ellison, the account had some connection to Chinese government officials and was likely used for bribery purposes.
- FTX Relaunch Second Offer Round Narrowed Down to Three Bidders: According to AFTXcreditor on October 12th, FTX CEO Sam Bankman-Fried narrowed it down to three bidders in the second offer round. The pre-agreed minimum bid will be determined on October 16th. It was reported that FTX had been in contact with more than 75 potential bidders to assess the possibility of evaluating the restart of the crypto exchange after FTX’s bankruptcy began. The final date for bids for FTX 2.0 was September 24th, with the aim of reopening FTX com or FTX US through acquisitions, mergers, capital restructuring, or other transactions.
What to Expect This Week?
This week may not be heavy on intense volatility for Bitcoin and cryptocurrencies, but the developments are essential and require close attention. Economic data to be released on Tuesday, Wednesday, and Thursday in the U.S. and Europe, along with Fed Chairman Jerome Powell’s speech on Thursday, could potentially create high volatility for Bitcoin. Additionally, Tesla will release its earnings reports on October 18th. This will reveal any changes in Tesla’s Bitcoin holdings, which might impact the BTC price if Tesla decides to sell its Bitcoin.
Critical developments of this week! ⚡️#US #Europe #FED $TSLA #Bitcoin #BTC $BTC pic.twitter.com/6MCPJi5oXP
— COINOTAG NEWS (@coinotagen) October 16, 2023
