Market Deep Dive: BTC$ and ETH$ drop, whale movements, SEC Drama, and EU’s MiCa regulations

BTC$ and ETH$ are down roughly 10% since last Friday. The SEC, whale movements, liquidations, and MiCa made this week’s headlines.

BTC$ and ETH$ both dropped 3.5% and 5% in an hour on Wednesday morning. The reason? There was a sell-off shortly after the UK CPI came in higher than expected, which was followed by about $160m in long liquidations across the crypto market.

This week, there were some eye-catching funds moved by some whale wallets. A dormant bitcoin whale recently moved around $60 million worth of bitcoin after nine years of inactivity. In addition to this, 180k ETH was sent to Coinbase from a wallet that became active for the first time since 2018. Even though one can never be certain that these funds are sold, investors are usually spooked and sell.

Another exchange, Bittrex, received a Wells Notice from the SEC. Much like Coinbase, they released a statement rebutting the SEC’s decisions. Bittrex U.S. has been winding down its operations and claims that it does not have any U.S. clients. Additionally, they expressed their concern that the SEC never reached out to them beforehand and that at no point did they request information or documentation. Once again, the lack of collaboration from the SEC with exchanges has been made apparent.

This behaviour from the SEC continued to be shown through Gary Gensler as he testified before the House Financial Services Committee during the week. He surprisingly refused to say if Ether is a security, even though he has declared in previous months that multiple other coins and staking services are securities. Throughout the hearing, he was slammed for not providing crypto companies with regulatory clarity and ultimately pushing the digital asset industry outside the U.S. Just this week, U.S. based Coinbase, received a license in Bermuda, and plans to launch its derivatives exchange in the coming weeks.

While U.S. regulatory bodies fight amongst themselves, the EU continues to make strides in the digital asset regulatory space. On Thursday, EU lawmakers voted in favour of new crypto regulations, MiCa, establishing them as the first major jurisdiction globally to introduce a comprehensive crypto law. This will require wallet providers and exchanges to obtain a license for operating, and calls for stablecoin issuers to maintain sufficient reserves. They also voted in favour of a separate law known as the Transfer of Funds Regulation, which will require crypto operators to identify their customers. It is expected for the laws to come into effect for stablecoin issuers in June 2024 and in December 2024 for other crypto service providers.

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