Analytical material on cryptocurrencies 16.05.2023
News block
1. G7 countries Plan to Strengthen Control over the crypto industry
Representatives of the G7 discussed in Japan the global financial implications of the introduction of CBDC and the laws governing the transfer of cryptocurrency assets.
The first conclusions about what to expect:
- any financial institution processing crypto transactions worth more than $3,000 must disclose the sender's name, address and account information.
The G7 Committee includes representatives from Canada, France, Germany, Italy, Japan, the United Kingdom and the United States
2. MiCA stimulates the inflow of venture capital
Over the past couple of months, an influx of venture capital funding has flooded into the European cryptocurrency market. Experts attribute this to the adoption of MiCA in the EU.
Markets in Crypto Assets (MiCA) is a regulatory framework that was approved earlier this year and is likely to become law in July this year.
The legislation is aimed at regulating crypto assets and those who deal with their transactions, whether individuals or legal entities. This is an important step in the regulation of the crypto industry, which establishes common rules in 27 EU countries.
Currently, Europe accounts for 48% of all venture capital financing that was directed to crypto startups (almost a tenfold increase).
Richard Teng, Binance's regional head for Asia, Europe and the Middle East, wrote on Twitter: "MICA provides clarity and regulatory consistency for crypto businesses in the EU. This is a role model for other regulatory bodies."
3. Florida Governor Ron DeSantis banned CBDC in the state
Florida Governor Ron DeSantis signed a bill on Friday banning the use of a "centralized digital dollar," also known as CBDC, in the state.
Now, the part of Florida law that defines money explicitly notes, "this term does not include the central bank's digital currency."
Ron DeSantis insists that the government should not control every single transaction and track how often someone buys certain things.
Only one vote was cast against the SB-7054 bill in its final presentation at a meeting of the Florida House of Representatives last week.
Overview of the crypto market
Bitcoin and ether started the week positively, increasing by 2.6% and 2.5% respectively at the start of trading on Monday, but both assets continue to trade below their 20-day moving average.
Trading volumes will now be of key importance to watch, as they can strengthen or dampen the sentiment associated with any directional movement.
Perpetual futures financing rates remain positive for both BTC and ETH, which is a sign that market sentiment remains bullish at the moment.
🔸 The current capitalization of the crypto market has decreased by 1.35% over the past day and amounts to $1.19 trillion
🔸 Trading volume for the last day is $33.7 billion (+10.8%)
🔸 BTC Dominance 44.7%
🔸 Fear and Greed Index:
- today 54, yesterday 50, a week ago 52
where, 0 is extreme fear, and 100 is extreme greed.
Extreme fear may be a sign that investors are too scared. This is often a good time to buy. When investors become too greedy, it means that the market needs correction.
🔸 Leaders of growth and decline. In the TOP 100 cryptocurrencies for the last day:
- the largest growth is shown by: HEX (+8.3%), XRD (+7.2%), LDO (+6.5%), CFX (+5.4%), BIT (+4.0%)
- the strongest drop is: HT (-4.9%), XDC (-4.6%), KAS (-4.4%), SUI (-4.1%), RPL (-3.9%).
Bitcoin
Transaction fees in the Bitcoin network have dropped sharply - the hype around BRC-20 tokens has declined:
In the first half of May, network commissions skyrocketed after the launch of the first cryptocurrency in the blockchain of many tokens of the new BRC-20 standard. This caused a stir and led to a new record in the number of daily transactions, which amounted to 682 thousand, which surpassed the peak of 2017 by an incredible 39%:
Miners were able to make good money on the congestion of the Bitcoin network - at the height of the BRC-20 hype, the average mined block contained, in addition to 6.25 BTC of standard remuneration and about 6.65 BTC in the form of commissions (a total of 12.9 BTC per block).
At the same time, over the past 2 weeks, the total balance of miners has increased by only 655 BTC, while they received 3,275 BTC due to transaction fees. I.e., the miners kept about 20% of the commissions received, and the remaining BTC were sold:
Ethereum
Commissions in the Ethereum network continue to be kept at a high level (this determines the number of ETH coins that are burned daily). As a result, in the last 7 days:
- 50,782 ETH were burned
- 12,939 ETH were issued
That is, over the past week, the supply of ETH coins has been reduced by almost 38 thousand. Ethereum is a deflationary asset today.
Important news of recent days on the main altcoin:
Ernst&Young, the world leader in auditing and consulting, has launched a platform for enterprises to track carbon emissions based on the Ethereum blockchain.
The platform is running in beta based on EY Blockchain SaaS. The system uses carbon emission tokens developed by the InterWork Alliance Standardization organization, supported by Microsoft, which is part of the Global Blockchain Business Council (GBBC), of which EY is also a member.
