crypto market meltdown

 crypto market meltdown

crypto market meltdown BTC makes its first lower low in what could be the beginning of a long-term downtrend is this the bear market or a big bear trap nft immunity despite a decline in search trends popular nfts continue to climb and new projects are popping is this proof that the nft niche has decoupled from the rest of the crypto market sec coming for cryptocurrency the sec expands its crypto dedicated division to crack down on the crypto industry.

 which crypto niches are most at risk rewards gone on crypto.com  cryptocurrency's most recognized company reduces rewards for its popular crypto debit cards everything you need to know banks blocking banks Argentina's central bank blocks two of its largest commercial banks from offering crypto services just days after they're announced why this is more significant than you think the fed raises rates the crypto market sees a brief relief rally as the federal reserve's interest rate increase and rhetoric exceed investor expectations how high could interest rates go and a closer look at last week's top-performing cryptos and where they're headed next all this and more in just a  moment.

 last week we saw something we haven't seen in a while and that's a sixth straight week of price decline for BTC  as far as I can tell this hasn't happened in over five years we also saw BTC make a lower low on the daily for the first time since the crash last May which as I mentioned in the introduction is an early warning sign that the bear market has set in judging from my recent Twitter poll about 80 percent of you are convinced we're in a bear market already and there's no denying that the nasty dip we saw over the weekend is evidence to that effect as I mentioned in my video about the best cryptos to hold during a bear market.

 however, I  truly believe that a  bear market has set in once we've seen consistently lower lows for weeks on end so far we haven't seen that and BTC has held up quite well all things considered take a second to consider that BTC is highly correlated to tech stocks and tech-heavy indices like the Nasdaq Nasdaq 100  now many tech stocks and many tech-heavy tech-heavy indices including the Nasdaq 100 have so far posted larger losses in 2022 than BTC which is impressive considering that BTC is seen as higher risk than most tech stocks this begs the question of how low we can go before something in the crypto market starts to break and there seem to be two key price points here the first is around 34k which is roughly where we are now this price point is significant and that's because this seems to be the price at which many bitcoin miners will be forced to sell their BTC.

 at least according to data from January this year it looks like some bitcoin miners have already begun capitulating notably riot blockchain which recently sold half of the BTC it mined in April to continue financing its operations the silver lining is that it's very likely that this BTC is being sold over the counter or otc meaning it shouldn't have that much of an impact on the spot price of BTC  the second price point to pay attention to is around the 20k mark and this is for two reasons the first is the most obvious and that's that 20k was BTC's top in the previous bull market the second reason is less obvious but arguably more important and that's MicroStrategy as you know MicroStrategy has been buying up billions of bucks in BTC and it's been using lots of debt to do so.

 this includes borrowing against BTC to buy BTC and as reported by crypto slate if the price of BTC was to fall below around 21k then MicroStrategy could face the liquidation of the 200 million worth of BTC it's put up as collateral for its crypto loan before you panic bears in mind that this would amount to a 40 drop from current prices this is unlikely to happen anytime soon and MicroStrategy seems to have a backup plan in case BTC gets bitten by the bear.

  it seems that the only crypto niche that hasn't really been all that affected by the recent crypto market downturn is nfts what's especially interesting is that no sales volume has stayed more or less the same over the last month or two despite the apparent downturn in retail interest at least according to to coin market cap this could potentially be explained by the fact that most of the trading volume in the nft market comes from collections like the board 8 yacht club which are primarily owned by high net worth individuals however it could also simply be a  consequence of the fact that art has historically been a good inflation hedge and this could be a partial driver behind the continued investment in NFTs from all levels of net worth there's also an additional factor at play here that's arguably specific to crypto.

 the trust in crypto increases the adoption of crypto the question then is what drives people to want to learn about crypto and besides speculation or necessity the only other factor seems to be fun just for fun in other words the nft niche might have a better time handling a bear market than most cryptocurrencies because investment is not being driven purely by speculation which will, of course, all but fade away in the depths of a bear market this would explain why hundreds of millions of dollars continue to pour into the nft industry even though some supposedly highly anticipated not marketplaces are seeing surprisingly low trading volume and user activity.

  I think you all know which one I'm talking about here it also explains why scammers continue to target not holders with the latest attempts being phishing links in open seas discord channel now with all that said however it's still too soon to say for sure that the nft niche has truly decoupled from the crypto market, especially since the nft niche itself has yet to see a serious bear market if you're not sure where to start when it comes to nfts you can check out my video about how to find the next 100x  not by using the link in the description now another thing to keep in mind when it comes to nuts is regulation which might sound funny because there haven't really been any real regulatory threats on that front as far as.

 I can tell this is because the financial action task force or fat f  doesn't consider nfts to be virtual assets for whatever reason and that means they're not subject to the same scrutiny as other crypto niches in countries that abide by the fat f's regulatory decrees.

 however, this seems to be changing because the united states security and exchange commission or sec recently announced the expansion of its crypto division and it included nfts on the list of crypto niches on its radar the sec's crypto division will nearly double in size from around 30 employees to around 50 and it's been renamed from the ambiguous cyber unit to the somewhat less ambiguous crypto assets and cyber unit in addition to nfts the sec's crypto division will be scrutinizing crypto videos offerings meaning icos videos and the like cryptocurrency exchanges any crypto projects that deal with staking d5  protocols and last but not least stablecoins so here's what I think they're going to do in each case for nfts they're going to pay extra close attention to fractionalized nuts and the like.

 because the sec's own pro-crypto commissioner Hester Hesterpierce has  previously warned that these likely  constitute securities offerings in many  cases and will therefore be subject to  the sec scrutiny i covered this in a  previous video and you know where to go  for that  as for icos and ieos i suspect the sec  will start expanding its reach into  newer forms of crypto crowdfunding like  initial stake pool offerings on Cardano  and para chain slot auctions on Polkadot  it's possible the sec will even go after  projects doing airdrops in ecosystems  like cosmos  now cryptocurrency exchanges is where  things could get really ugly because sec  chairman Gary Gensler seems to have an  axe to grind with coinbase and i have a  gut feeling that the sec will try and  force all cryptocurrency exchanges in  the united states to register with it  this could result in many altcoins being  delisted from exchanges the way xrp was  after the sec went after ripple  the staking side is also where things  could get really ugly.

 because it's not entirely clear whether the sec's interests include proof-of-stake cryptocurrencies or just centralized staking platforms let's hope it's not the former similarly it's going to be interesting to see what the sec tries to do to defy protocols especially since many of them have recently gone to great efforts to decentralize both their back ends and front ends now the good news is that if the sec tries to step too hard on any of these crypto niches it will see a lot of pushback from the crypto lobby and you can learn more about how those fine folks are protecting the crypto markets from anti-crypto policymakers using the link in the description speaking of pushback crypto.com recently reduced the rewards on its popular crypto cards to the point at which it caused its cro coin to plummet.

 now I'll leave a link to crypto.com's blog post with the full details about this in the description but the short of it is that the company suddenly announced the cashback rewards on all crypto. coms cards would be slashed along with the staking rewards on cro the pushback from cardholders was so intense that the company caved into the pressure and slightly increased cro staking rewards for select card tiers albeit not at the same levels that they were before on that note there'll be no changes to the cashback on crypto.com's.

cryptocardscrypto cards nor their cro staking rewards until June the 1st  more importantly anyone who recently purchased a crypto.com crypto card will continue to earn the old rewards until the 180-day lock-up period for the cro they used to purchase the card is complete unfortunately crypto.com pivot didn't protect cro from its continued plunge and many are rightfully upset about the abrupt changes especially those who recently purchased a crypto.com card there's another side to this story however and that's that there doesn't seem to be all that much cro left to compensate card cashback cro stakers and validators on the crypto.org chain.

  it's also easy to forget that cros utility is technically no longer limited to crypto.com  the crypto.org chain and the Chronos chain have both seen a surprising amount of adoption and cro is required to keep these new ecosystems operational the silver lining there is that there are additional demand drivers for cro besides crypto.com cards which could lead to positive price action for cro further down the line, even so, cross supply sustainability is something crypto.com should have factored in but it's quite possible that it didn't anticipate just how much adoption there would be case in point crypto.com has seen exponential growth over the last year.

  recently surpassed 50 million users now I'll be doing a deeper dive into cro later this week so stay tuned for that meanwhile in Argentina the country's central bank recently blocked two of the country's commercial banks from offering crypto services to their clients for context Argentina has one of the highest rates of crypto adoption in the world and the reason why these two commercial banks decided to offer crypto services was because of demand from their clients as is often the case Argentina's crypto adoption has mostly to do with the exponential rate of inflation the Argentinian peso has seen over the past decade an inflation rate that recently hit a record high of 55  the reason why Argentina's central bank blocked the two commercial banks from offering crypto services is because of a  debt deal with the IMF that the  Argentinian government signed back in March.

 which included a clause to prevent crypto adoption in the country the reason why this is so significant is that this anti-crypto adoption clause is something that was almost certainly known by the country's commercial banks the fact that these two banks went ahead and offered crypto services anyway speaks volumes to just how significant the demand for cryptocurrency is in the country come to think of it this is an eerily similar situation to the one in the African central African republic where the president declared bitcoin legal tender without the central bank's knowledge.

   presumably without its approval either not surprisingly the IMF recently came out to condemn the central African republic the same way it did with el Salvador Salvador when it adopted bitcoin as legal tender last September this suggests that the central African republic's adoption of bitcoin is a much bigger deal than we think because otherwise, the IMF  wouldn't be making such a big deal about it if you ask me the IMF is absolutely terrified that this trend of adopting BTC  as legal tender will continue and there's no question that Argentina is one of the countries where BTC could flip fiat.

  another central bank that made the crypto headlines last week was the federal reserve this is because federal reserve chairman Jerome Powell announced that it would be raising interest rates by 0.5 which is exactly what the markets were pricing in not only that but Jerome even said that the fed would not be looking to raise interest rates by 0.75 in June given that the market had been pricing in a 0.75 hike the prospect of a lower hike translated to euphoria across all markets including crypto as you'll all know by now however this relief rally did not last for very long and if you're subscribed to my weekly newsletter you'll know that this is because of a series of factors namely recession fears being driven by the usual suspects like the war in Ukraine.

  supply chains china lockdowns etc now the factor I want to focus on here is the inflation figures for April which are set to be released this Wednesday I  have a sense that the markets are on edge about the possibility that the cpi for April April will be higher than the cpi for the march this is simply because if inflation is still running too hot the fed could yet pull another 180 and throw a 75 basis point rate hike back on the table or worse conversely if inflation is starting to cool down we could see another relief rally as the market starts to price in a  more dovish Fed.

  now the wild card in this equation is what all the other central banks are doing around the world namely the bank of England and Australia's central bank both of whom are aggressively raising interest rates for the first time in years select members of the European central bank are pushing for it to raise interest rates as well and though none of these banks is as significant as the fed on their own the combined rate hikes will almost certainly have a significant effect on the global economy.

 I'll explain exactly why in an upcoming update about the project so stay tuned for that next up we have Tron whose tax coin was a top performer the week prior trx's rise is again related to our doubled stable coin which is inspired by terrors must now try actually appears to be in a  pretty strong long-term uptrend but I  will repeat what I said last week and that's that trx's trend isn't nearly as impressive in percentage terms compared to other cryptos oddly enough curved dow's crv seems to have risen for the same reason as trx and that's us doubled stablecoin this is because the curve is a stable coin dex and there seems to be an expectation that it will soon support us doubled though this hasn't happened.

 at the time of shooting curve also recently deployed to near protocol's EVM layer aurora more about near protocol in the description I I digress in terms of price action Crv is once again similar to tax in that it's in a  long-term uptrend though this trend is not all that strong in percentage terms, in this case, the cause is likely crv's constant inflation next up we have one-inch network's one-inch token which took a trip to the moon because of the d5  protocol's integration with the opera browser one-inch network's gas refund also seems to have played a supporting role in the recent pump, unfortunately, one inch's long-term price action is not very pretty and its recent pump barely registered on the chart last but certainly not least we have helium's, not coin whose price popped off on the news that light hotspots will soon be coming to helium's peer-to-peer internet protocol, unfortunately,.