$BTC 24 Hour High $36,768
$BTC 24 Hour Low $31,390
$ETH 24 Hour High $2214
$ETH 24 Hour Low $1758
Happy Monday from HKbitEX!
It’s been a week of #FUD and dumps, which ended in a bloody sell off with $BTC touching $31K momentarily this weekend. The market has been in a full panic mode stemming from China’s crackdown on crypto mining to several rug pulls during the week. Generally, we see more selling pressure from the East and dip buying action from the West. With no clear indication of a bull or bear market as of now, we expect the market volatility to continue for the coming days. Always #DYOR, manage your risk and stay away from leverage.
The $BTC and $ETH market
$BTC down another 23% since Monday with most of the selling happening last Wednesday, with $BTC plunging to as low as $30,000. The dip believed to be a result of over-leveraging during this long lasting bull market. $9B positions were liquidated in 24 hours, another highest after the 18 Apr event. The bulls then quickly resumed the loss, pushing the market above $40k, and tried to retest the $42k resistance but failed to close the candle there due to the increasing circulation of FUD. Market momentum has been extremely weak, especially after the Chinese government announced a further restriction on crypto trading and mining in China, which caused another selloff over the weekend, testing $31k for the 2nd time in 1 week. Fortunately, we saw strong support at this level as the bulls attempted to defend short-term support at $35,300. Another interesting signal is the current $BTC dominance level, which has rebounded from its lowest of 39.9 back up to 46.5, meaning majority of investors are now eyeing up $BTC over alts. $BTC is currently outperforming the alts market. At the time of writing, $BTC is now trading at $35,441 with $38,000 as its next major resistance level and $30,000 as its next key support level.
$ETH wise, market is down by 40% from last Monday. No doubt most of the selling happening again last Wednesday, following the market crash. The bears dominated the market dipping $ETH straight down testing $2000. Similarly, the bulls successfully defended their support there and pushed the market back up to $3000, but failed to close the weekly candle there, as the Sunday crash brought the market down again towards the $1700 level. With $BTC dominance increased to the level of 46, $ETH/$BTC is now trading at 0.060 from the previous 0.08 level, which fits our expectations as investors are now focusing on the largest cap token. At the time of writing, $ETH is now trading at $2140 with $2400 as its next major resistance level and $1800 as its next key support level.
MicroStrategy (MSTR:NASDAQ) announced last Tuesday (14/5) that the company has bought another $10 million worth of $BTC, at an average price of about $43,663, which increases its $BTC holdings to a total of around 92,079, with an average price of about $24,450. The MSTR stock price closed at $450.52 last Friday, representing a decline of 65.7% from the February 9 trading high.
According to The American Families Plan Tax Compliance Agenda issued from the US Department of the Treasury last Thursday (20/5), the Biden Administration proposes that all crypto transfers of more than $10,000 will have to be reported to US tax authorities. According to “The Block”, banks will supply the IRS with additional information on financial accounts for tax purposes, including information related to crypto transactions, through a reporting framework in order to increase the visibility of these transactions. The proposal aims for that to take effect in 2023.
According to the spokesperson from the PRC Government’s Financial Stability and Development Committee last Friday (21/5), China will crack down on bitcoin mining and trading activities. It was the first time China regulators put their spotlight on the bitcoin mining sector, which occupies for more than 70% of the world’s total crypto mining. The announcement came after another ban just the day before which focuses on forbidding all banks and payment companies providing crypto-related services.
According to the Consultation Conclusions issued last Friday (21/5) on Legislative Proposal to Enhance AML/CTF Regulation in Hong Kong from the SAR government’s Financial Services and the Treasury Bureau, it is concluded that the FSTB proposed to designate the business of operating a VA exchange as a “regulated VA activity” under the AMLO and require any person seeking to operate a VA exchange in Hong Kong to apply for a licence from the SFC as a licensed VASP under the AMLO. It is also worth noting that a licensed VASP can only offer services to professional investors and must impose rigorous criteria for the inclusion of VAs to be traded on its platform. It is expected that the amendment bill would be introduced into the Legislative Council in the 2021-22 legislative session while a 180-day transitional period would be given upon commencement of operation of the licensing regime to facilitate application by interested parties.
Alts & DeFi
Alts and DeFi wise, Defi TVL (Ethereum network) drops to $50.24B at the time of writing. For some well-known ones, over the week, Yearn Finance ($YFI) records a 46.8% decline, Aave ($AAVE) at -38.96%, Compound ($COMP) at -48.14%, Uniswap ($UNI) at -50.54%, Polkadat ($DOT) at -55.26%, Chainlink ($LINK) at -46.39%, Cardano ($ADA) at -38.16% and Polygon ($MATIC) at -14.81%.