Coin360 Daily Dispatch | Crypto Market Updates & Highlights | June 26, 2023

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Jun 26 2023

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Markets360

Crypto Market Update

Written by Van

Banking and Regulatory Updates

HSBC Expands Crypto Services in Hong Kong
CACEIS Bank Receives PSAN Status for Crypto Custody
Japan Introduces Corporate Crypto Tax Exemption
Binance Faces Mounting Regulatory Scrutiny
Bybit Obtains Crypto License in Cyprus

Crypto Market Updates

Crypto Investment Products See Major Inflows
Bitcoin Holds Strong Support at $30,000
Ethereum Low Exchange Supply Signals Bullish Trend
Lightning Network Reaches Record Capacity
Litecoin Mining Difficulty Increases

New Developments and Partnerships

ZK Stack Launches for Ethereum-Compatible Rollups
NEAR Protocol Partners with Alibaba Cloud
Algorand Forming a $50 Million Partnership with DWF Labs

HSBC Expands Crypto Services in Hong Kong

HSBC customers in Hong Kong can now buy BTC and ETH futures ETFs, expanding local users' exposure to cryptocurrencies. The bank has also launched the HSBC Virtual Asset Investor Education Centre to educate customers about the risks associated with crypto. Hong Kong has encouraged digital assets, establishing an exchange licensing system, funding for web3 development, and committing to introducing stablecoin legislation by 2024.

CACEIS Bank Receives PSAN Status for Crypto Custody

CACEIS Bank owned by Credit Agricole and Santander, received PSAN status from the AMF to provide crypto asset custody services in France, as demand for digital assets grows from institutional investors and investment management companies. CACEIS is one of Europe's largest asset-servicing firms, with $2.3 trillion in assets under administration.

Japan Introduces Corporate Crypto Tax Exemption

The National Tax Agency of Japan has released updated corporate tax guidelines, granting a tax exemption on unrealized gains from crypto assets issued by companies. The exemption takes effect six months later and aims to retain crypto-related businesses in Japan. Stricter AML measures and stablecoin regulations have also been implemented.

Binance Faces Mounting Regulatory Scrutiny

As per Kaiko, Binance's spot trading market share hit a one-year low at 55.9% in June 2023 due to increased regulatory scrutiny globally, including lawsuits from the SEC and CFTC in the US. The exchange also faced regulatory troubles in France and Belgium. Despite the decline, Binance remained larger than all other exchanges combined. Meanwhile, Binance has withdrawn its license application in Austria, adding to its recent exits from the Netherlands, Cyprus, and the UK. The company aims to focus on compliance with MiCA requirements and faces legal battles with regulators in the US.

Bybit Obtains Crypto License in Cyprus

Crypto exchange Bybit has obtained a license to operate in Cyprus, positioning itself ahead of the implementation of the EU's regulatory regime, MiCA. Bybit aims to support compliance and global expansion. Meanwhile, Binance has exited Cyprus and withdrawn its crypto license application in Austria amid regulatory uncertainty.

Crypto Investment Products See Major Inflows

Last week, crypto investment products experienced their highest inflows since July 2022, with $199 million pouring into funds. Bitcoin dominated the gains, while altcoins saw minimal inflows. The positive sentiment is attributed to high-profile ETF filings by major asset management firms. Total assets under management across fund managers reached $37 billion.

Bitcoin Holds Strong Support at $30,000

Bitcoin held strong support at $30,000, with hopes of a copycat move from the previous week by US markets. Institutional-grade ETF applications have contributed to the trend, with top exchanges in Asia seeing a strong accumulation. Analysts are bullish with moving averages pointing to a future uptrend, while any retracement is expected to be shallow.

Glassnode data shows that 96.9% of Bitcoin's short-term holders are now in profit after the recent rally above $30,000. The increase in profit may lead to potential profit-taking and a possible price drawdown, but past instances have not always resulted in a slowdown of the rally. The market's ability to absorb profit-taking remains uncertain.

Lightning Network Reaches Record Capacity

The Bitcoin Lightning Network has reached a new all-time high in USD capacity, with 5,630 BTC worth around $172 million. The growth reflects increased adoption and positive user perception of Bitcoin as an alternative payment method. The Lightning Network aims to address issues of high fees and slow speed on the Bitcoin blockchain. The record-breaking capacity can impact Bitcoin's growth trends and complements the positive sentiment around the cryptocurrency, fueled by the spot Bitcoin ETF application and other factors.

Ethereum Low Exchange Supply Signals Bullish Trend

Ethereum's low supply on crypto exchanges is a bullish signal as sell-off pressures may be limited, according to Santiment. ETH's average transaction fees have also fallen to pre-2021 levels, making it attractive. Santiment suggests there is fundamental strength in the leading altcoin despite the current price setback.

However, the largest short seller on GMX is facing potential liquidation with a short position of $12 million in ETH. The short seller's position will be liquidated if the Ethereum price reaches $1,945.18, but limit orders could increase the liquidation price to around $1,967. The potential liquidation has sparked rumors of an ETH breakout above $2,000.

Litecoin Mining Difficulty Increases

Litecoin's mining difficulty has increased by 3.38% in the last 24 hours, reaching a value of 26.38 M at block 2,498,134. This reflects a growing challenge for miners to discover new blocks and receive rewards. The rise in mining difficulty is not unique to Litecoin; Bitcoin has also experienced a surge in mining difficulty, indicating a healthy and secure network with increased participation. This trend helps control the rate of new coin issuance and contributes to the decentralization and security of the cryptocurrency networks.

ZK Stack Launches for Ethereum-Compatible Rollups

The team behind zkSync Era is launching ZK Stack, an open-source framework for building Ethereum-compatible layer-2 zk-rollups and layer-3 "hyperchains." The framework offers customization, scalability, and security while relying on Ethereum mainnet for liveness and security. ZK Stack aims to provide an open-source alternative to Optimism's superchain and enables seamless trustless networks with low latency and shared liquidity. Developers can experiment with hyperchains, and the first hyperchains are expected to go live later this year.

NEAR Protocol Partners with Alibaba Cloud

NEAR Protocol's token surged up to $1.60 after it announced a partnership with Alibaba Cloud, granting access to developer ecosystems in the Middle East and Asia. This infrastructure and remote procedure calls, potentially attracting new blockchain developers to NEAR's network.

Algorand Forming a $50 Million Partnership with DWF Labs

Algorand and DWF Labs have formed a $50 million partnership to back DeFi, art and music, gaming, oracles and bridges, and infrastructure. DWF Labs has invited interested parties to submit proposals to build on Algorand's ecosystem. The move comes after Algorand rolled out a protocol update on 23 June.

Top Altcoin Gainers and Losers

Gainers:

FLEX FLEX (+22.02%)

Bitcoin Cash BCH (+17.65%)

NEAR Protocol NEAR (+13.23%)

Losers:

Aave AAVE (-11.79%)

Kava KAVA (-4.91%)

Kaspa KAS (-4.38%)

NFT Market Map

Chiru Labs, the Web3 startup behind Azuki, a popular Ethereum NFT collection, will release 20,000 new NFTs called Azuki Elementals. Existing NFT owners received an airdrop, and the remaining Elementals will be sold via a Dutch auction. The collection expands the Azuki universe with new anime-themed profile pictures. The Elementals will have randomized attributes of varying rarity, with four tiers and the possibility of rare "grail" NFTs. Azuki has generated over $1 billion in trading volume, and Chiru Labs plans to collaborate with Line Friends for content, merchandise, and events.

Jeffrey Huang, also known as Machi Big Brother, caused turbulence in the Bored Ape Yacht Club NFT market by selling over 50 Apes and making several purchases from the collection. The floor price of Bored Ape NFTs dropped to its lowest point since November 2021 due to Huang's actions. However, the collection rebounded slightly after Huang acquired 14 Bored Apes.