Week Ahead: Cryptocurrencies stay resilient as risk appetite returns, up next Fed rate decision
BTC traded higher last week and at one point retook the $24K level as the risk was back on. USD found some of its footing and put pressure on digital assets to close the week, but BTC managed to hold on above $22K. ETH is trading above $1,500 on the weekend after being range bound between $1,500 and $1,600 most of the week. US stocks climbed higher last week as risk appetite returned to the market.
The Fed’s interest rate decision on Wednesday is the most significant risk event, with the market expecting a 75 basis points hike, but not investors are not discounting an oversized 100 bp interest rate lift.
Cryptocurrency stocks got a boost from retail investors, with over $1B shares bought in the last two weeks. Crypto’s rebound sustainability is under question as some investors argue there is a case for a bottom while others are more cautious. Tesla announced last week that it sold off 75% of its crypto assets adding $936M to its balance sheet.
3AC co-founders resurfaced and said they are aiding in the recovery process for creditors; they blamed overconfidence for the hedge fund collapse. FTX offers an account with a cash balance funded by an early distribution on a portion of Voyager Digital customer bankruptcy claims. Alameda Ventures is set to acquire all Voyager digital assets and loans except those to hedge fund 3AC.
In funding news, Barclays to acquire a stake in UK’s Copper, with fundraising to be finalized within days. Core Scientific signed an agreement to issue up to $100M shares with investment bank B Riley.
Mercado Bitcoin is to expand into Mexico by year-end through an acquisition with no details as regulatory approvals are pending. The firm continues its expansion plans and forecasts the crypto winter will persist until the end of 2023. Thailand-based Zipmex announced it would resume withdrawals last week and said it was raising funds to address its $53M exposure to Babel Finance and Celsius.
In regulation news, US SEC wants crypto lending companies to register as investment companies. Thailand’s SEC is looking to add to the existing digital asset regulation introduced in 2018. US prosecutors charged three people with insider trading in the first case involving crypto assets.
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