ALSO: Central banks drain $3T via quantitative tightening
The latest moves in crypto markets, in context Was this newsletter forwarded to you? Sign up here. |
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Good morning, and welcome to First Mover. I'm Lyllah Ledesma, here to take you through the latest in crypto markets, news and insights. - Price Point: Bitcoin was holding steady just below $20K despite a pall of bearishness over traditional markets. The crypto exchange Huobi announced a buyer, and TrueFi issued a notice of a loan default.
- Market Moves: The dollar-linked stablecoin USDC gained momentum and market share after the Terra blockchain's collapse earlier this year, but now the market value is shrinking again, falling below $50B and ceding ground to rivals Tether (USD) and Binance USD (BUSD). Omkar Godbole reports.
- Chart of the Day: The biggest central banks have been following through on their pledge to drain liquidity from the global financial system, with a $3T balance-sheet reduction over the past six months.
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Bitcoin (BTC) started the week off trading down 1% on the day, dipping below the $20,000 mark after spending the weekend trading in a range between $19,200-$19,500. U.S. stock futures were lower after Friday's jobs report and a possible escalation of the Russia-Ukraine war. European stocks fell for the fourth straight day. Investors in traditional markets are looking ahead to a big week of corporate earnings reports and the monthly Consumer Price Index report scheduled for release Thursday. Ether (ETH), the second largest cryptocurrency by market value, was also down slightly on the day, around $1,300. For altcoins, TRON (TRX) made gains of 3% on the day and Quant Network lost 4%. In the news, Huobi Global, one of the biggest token trading outposts in the Asia markets, said late Friday that it has agreed to be purchased by Hong Kong-based investment company About Capital Management's M&A fund. Crypto investment firm Blockwater Technologies defaulted on a loan from TrueFi, a decentralized lending protocol, TrueFi said in a statement Sunday.The South Korea-based crypto investment firm failed to make a payment on a $3.4 million loan to TrueFi, a decentralized lending protocol. |
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And privacy-focused cryptocurrency and payments firm MobileCoin, in collaboration with stablecoin platform Reserve, has launched a new stablecoin dubbed "Electronic Dollars" (eUSD). The company says eUSD is fully collateralized and is uniquely designed to protect users' private transactional data.
Early Monday, the Bitcoin mining difficulty (the degree of difficulty involved in discovering new bitcoin blocks through mining) increased significantly by 13.55% to 35.61 trillion, a record high and the largest increase since May 13, 2021, as noted by WuBlockchain on twitter.
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Market Moves: Back to Square One? Circle's USDC Market Cap Drops Below $50B for First Time Since Terra's Collapse |
USDC's market cap drops to lowest since January (CoinGecko, CoinDesk) |
Circle's dollar-pegged stablecoin USD coin (USDC) has returned to earth after seeing impressive growth following the collapse of Terra in May. The stablecoin's market value has dropped by $10 billion to $46 billion in three months, hitting the lowest since January, according to data source CoinGecko. The decline has more than reversed the rise from $48 billion to $56 billion seen after Terra's algorithmic stablecoin UST went bust, sparking redemptions in tether (USDT), the world's largest stablecoin. USDC appears to have lost market share to rivals Binance USD (BUSD), the world's third-largest stablecoin and tether. Since early July, BUSD's market value has increased by 21% to $21.66 billion and tether's has gone up by 3% to $68.3 billion. According to industry experts, several factors, including stability in USDT, Tornado Cash sanctions and Binance's recent decision to consolidate order books, are responsible for USDC's dwindling market capitalization. |
Read the full story here. |
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Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive, and standardized classification system for digital assets. The CoinDesk Market Index is a broad-market index of digital assets, weighted by market capitalization. A full description of the methodology is here. |
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Record Liquidity Tightening |
The combined G-4 central bank balance sheet size has been reduced by $3 trillion in six months in a process known as quantitive tightening or QT. Source: BofA global research, @ayeshatariq | - "If you think that QE was helpful on the way up, you have to believe that QT will be unhelpful on the way down," Callum Thomas, head of research and founder at Topdown Charts, wrote in a email.
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Check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9 a.m. U.S. Eastern time. - Patrick Hillmann, CCO Binance
- Octavio Marenzi, CEO Opimas
- Valerie Dahiya, Managing Partner Perkins Coie LLP
- Stephen Kaminsky, Strategic Initiatives and Special Projects Jump Crypto
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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