By Marcus Sotiriou, analyst at the publicly traded digital asset broker Global block
Despite last week’s news of the latest inflation data, the crypto market has since seen a recovery. Headline U.S. CPI for June was 9.1% year-over-year, well above the median forecast of 8.8% and the highest since 1981 The result is another blow to economic and social well-being, as the federal Reserve is forced to be more aggressive. However, Bitcoin has risen over 10% since the news and Ethereum has soared nearly 40%. When the market begins to react positively to negative news, it is a signal that a local low could be reached for the time being, as fear may have caused the news to price in.
After the catastrophic events that have unfolded in the crypto market over the past few weeks, tough regulation may be coming soon. The collapse of CeFi lenders may be why regulators have sought to implement draconian controls on cryptocurrency.
In a recent interview, SEC Chairman Gary Gensler said, “More generally, the public would currently benefit from investor protection around these various service providers, exchanges, lending platforms and brokers. So, at the SEC, we work in each of these three areas – exchanges, loans, and brokerages – and discuss with industry participants how to achieve compliance or change some of that compliance. “
The chief executive of the UK’s Financial Conduct Authority, Nikhil Rathi, presented the FCA’s regulatory objectives to the Peterson Institute for International Economics on Wednesday. Rathi said: “The US and UK will deepen their ties on crypto-asset regulation and market developments, including around stablecoins and exploration of central bank digital currencies. .” So far, however, little has been done to support the growth of the crypto ecosystem by US and UK regulators, as their lag drives crypto-related activities away from their economies.