Gm,
It’s the last week of February and Bitcoin is showing signs of strength with key levels of support being held. Despite BTC being below the $40,000 mark, there are signs that a comeback could be on the cards in the coming weeks.
With concerns over inflation, monetary policy, and tensions rising amongst the Russia/Ukraine conflict, crypto and stocks could still be in for a clapping.
The first of the concerns sit with inflation. The Fed has hinted that the hikes could be expected as early as March which will negatively impact equities and crypto markets due to the ‘easy money’ completely drying up from markets. Rising interest rates are a double-edged sword, too many too soon run the risk of a recession and too little may have no impact on reducing the highest inflation seen in 40 years.
The situation in Russia could also have a grave impact on equities with $1.3 trillion wiped from global stocks the past week as a result of the heightened Russia/Ukraine risk coupled with the potential Fed rate hikes.
With all these variable factors in play, it’s no surprise that market participants are feeling uneasy. I have talked about the crypto fear and greed index before, it is the index that measures the emotions of the market. With Bitcoin dipping below $40,000, we have seen the sentiment moving towards the ‘extreme fear’ zone. As of Monday, the index measures 25/100 - which is the highest fear reading.
Weekend price movements for BTC tend to be disregarded by veteran traders due to the lack of volume. Given the dip to $38,000, analysts are saying that this could be an exaggeration of market sentiment.
Let’s wait and see.
Markets
As of 21st Feb 2022
(source: coinmarketcap)
Headline roundup
Block, Circle, Coinbase create decentralised identity solution for KYC’d blockchain transactions (LI)
Crypto enthusiasts forming DAO to buy Denver Broncos NFL team (CD)
Financial Stability Board worried about institutional exposure to crypto-assets (LI)
Binance.US hires former Scoeite Generale and Gemini exec as Chief Compliance Officer (CD)
Mastercard to offer consulting for crypto, digital currencies (LI)
Twitter adds ethereum wallet support to tipping feature (CD)
State Street Survey: DeFi seen as biggest digital asset disruptor (LI)
Crypto custodian Fireblocks acquires stablecoin firm First Digital (CD)
SDX partners with FQX for promissory note trading as digital assets (LI)
Berkshire Hathaway invests $1bn in Brazilian digital bank Nubanl, reduces Mastercard and Visa positions (CD)
CBDC
Taiwan to complete retail CBDC simulations by September (LI)
Kenya keen on CBDC for interoperable payments (LI)
VC
Stablecoin firm Circle doubles valuation to $9bn in new SPAC deal (CD)
MediLedger blockchain developer Chronicled raises $8.3m from True Global Ventures (LI)
Red Bull Racing lands $150m sponsorship from crypto exchange Bybit (LI)
Crypto-powered wireless network Helium raises $200m at $1.2bn valuation (CD)
Ethereum system Skale launches $100m ecosystem fund (CD)
The Graph backers launch $205m ecosystem fund to provide grants to Dapp builders (CD)
Sequoia Capital looking to raise up to $600m for new crypto fund (CD)
Meme of the week
About Me
My name is Michael Burke, and I started working in the blockchain space 5 years ago, firstly with Deloitte, now with R3, where I help our customers build enterprise solutions utilising the Corda platform. My interest in blockchain and cryptocurrency stems from the sheer potential of the technology to completely transform industries and value chains for the better.