Coin360 Weekly Dispatch | Crypto Market Updates & Highlights | September 16 - September 22, 2023

Crypto Weekly Market Update

Written by Van

Table of Contents

Crypto Market Overview

• Crypto Weekly Recap: Price Actions, Market Trends, and Key Developments

Banking and Regulatory Updates

• Citigroup Dives into Tokenized Bonds with BBX
• Mt. Gox Credit Repayment Extension Shakes Crypto Market
• Laser Digital Launches Bitcoin Adoption Fund
• Binance Fights SEC Lawsuit with Dismissal Motion
• FCA Tightens Crypto Advertising Rules in the UK

Crypto Exchanges and Legal Troubles

• JPEX Exchange Fraud Case Intensifies in Hong Kong
• Bankrupt FTX Sues Salameda to Recover Millions
• Bybit Suspends UK Operations Amid FCA Changes

Tech and Security News

• Google Cloud Adds 11 New Blockchains to BigQuery
• Nansen Discloses Security Breach Affecting Users

The Evolving NFT Space

• OpenSea's Royalty Cuts Shift NFT Creator Landscape
• Polygon and Solana See NFT Ecosystem Fluctuations
• Stoner Cats NFT Faces SEC Scrutiny, Prices Surge

Crypto Weekly Recap: Price Actions, Market Trends, and Key Developments

Bitcoin:

• Weekly change: +0.38%
• Over the weekend, BTC was stagnant at around $26,500 but surged to $27,000 on Monday, while investors were waiting for key data from the U.K. and U.S.
• The upswing was fueled by Citi's blockchain pilot for big clients and buzz about BlackRock potentially buying 12,200 Bitcoin.
• A setback came when the SEC backed a motion against Binance, pushing BTC down to $26,700.
• On Tuesday, BTC hit a monthly high of $27,400, propelled by Mt. Gox's delayed payouts and Japan's Nomura bank launching a Bitcoin fund.
• Only 11.8% of Bitcoin's total supply was in centralized exchanges, reaching its yearly low, right before a key FOMC meeting.
• BTC dipped to $26,400 after Fed Chair Powell hinted at future rate hikes but later recovered slightly to $26,600.
• With the 10-year U.S. Treasury yield at a 16-year peak, Bitcoin and the crypto market are on shaky ground. Short-term holders are nearing a 100% unrealized loss.

Ethereum:

• Weekly change: -2.06%
• ETH started Monday above $1,600, peaking at $1,667. RxR Research noted it was trading at a 27% discount to fair value.
• Tuesday saw a dip to $1,650, just as a whale moved 6,000 ETH to Kraken. A few hours later, it slid to $1,640.
• On Wednesday, the ETH/BTC ratio hit a 14-month low, driven by big holders like Vitalik Buterin shifting funds to exchanges.
• Thursday brought a gas fee explosion, up 30x to 300 Gwei, with Binance's wallet spending nearly $1M on ETH gas fees alone.
• Glassnode revealed the number of 1,000+ ETH holders has sunk to a 5-year low.
• ETH bottomed out at $1,575 on Thursday, its lowest since mid-September, before rebounding to around $1,590 but failing to crack $1,600.

Altcoins:

• ApeCoin DAO voted to create a sister DAO for influential NFT acquisitions.
• Balancer's frontend suffered a DNS attack, losing over $250K.
• Wintermute transferred 7.3 million Blur tokens to two exchanges.
• Canto surged 13% after announcing a move to Ethereum as a layer 2 network.
• Polygon Labs suggested using CDK to help Celo migrate to Ethereum's layer 2.
• OPNX's $30M bid for Hodlnaut was turned down as FLEX token tanked by 90%.
• ImmutableX rose 25% due to a price surge driven by South Korean traders.
• Nexo earned CSA STAR Level 1 Certification, boosting its security and transparency.
• MakerDAO's MKR approached a 16-month high, fueled by whale accumulation and a bullish crypto hedge fund.
• Optimism Foundation's $157M token sale shook the market following its third airdrop.
• Toncoin entered the top 10, gaining 30% in a week.
• Circle launched its native USDC stablecoin on both Polkadot and NEAR.

Citigroup Dives into Tokenized Bonds with BBX

Citigroup has announced its role as the initial digital custodian for the BondbloX Bond Exchange (BBX), a leading fractional bond exchange. BBX leverages atomic settlement and distributed ledger technology to facilitate instant exchange of tokenized bonds. Citigroup's digital custody technology enhances this process on permissioned blockchain networks. 

Additionally, Citigroup is collaborating with Maersk to provide blockchain-backed digital services, reducing transaction times. The bank's focus on digital assets is evident through partnerships with Ripple and asset manager Xalts. Citigroup aims to modulate global liquidity through programmable settlements.  

Mt. Gox Credit Repayment Extension Shakes Crypto Market

Mt. Gox, the defunct cryptocurrency exchange, has been granted an additional year for credit repayments by Tokyo's District Court, extending the deadline to October 2024. Trustee Nobuaki Kobayashi cites the complexities of rehabilitating creditors as the reason for the extension. With Mt. Gox holding a massive stash of 142,000 BTC and 143,000 BCH, its financial status has been a key topic of discussion in cryptocurrency charts. 

This development has caused ripples in the cryptocurrency market, with Bitcoin maintaining stability despite concerns of price weakness. Traders expect the market to remain rangebound until further clarity emerges. The delay has raised speculation and impacted market sentiment.  

Laser Digital Launches Bitcoin Adoption Fund

Nomura Bank's subsidiary, Laser Digital, has launched the Bitcoin Adoption Fund, targeting institutional investments. The fund is registered in the Cayman Islands and offers secure custody through Komainu. As Bitcoin's crypto price skyrockets past $27,000, Laser Digital jumps in, aiming to accelerate the world's digital makeover. 

Laser Digital is committed to regulatory compliance and plans for future registrations in Ireland, Luxembourg, and the UK. With over $50 billion in Bitcoin assets accumulated, the trend of Bitcoin investments is expected to continue. Laser Digital plans to expand its offerings and recently obtained a crypto license in Dubai.  

Binance Fights SEC Lawsuit with Dismissal Motion

Binance Holdings, its U.S. counterpart, and CEO Changpeng Zhao have filed a motion seeking the dismissal of a lawsuit brought against them by the SEC. They argue that the SEC exceeded its authority and failed to provide clear guidelines for the crypto sector before filing the lawsuit. 

Binance.US, the American branch of the exchange, also filed a separate motion to have the charges dismissed. The SEC alleges that Binance offered the sale of unregistered securities and operated illegally in the U.S. The ongoing regulatory action has greatly impacted trading activity on Binance.US.  

FCA Tightens Crypto Advertising Rules in the UK

The UK's Financial Conduct Authority (FCA) has warned crypto businesses to adhere to new financial promotion rules, as the majority of firms appear to be ignoring them. The rules will restrict how promotions from unregistered crypto businesses can be communicated, with penalties including imprisonment and fines. 

The FCA has expressed concern over poor engagement from overseas crypto firms with UK customers. Non-compliant firms adjacent to crypto businesses, including social media apps and payment companies, may also be liable for money laundering offences.

JPEX Exchange Fraud Case Intensifies in Hong Kong

The JPEX crypto exchange fraud case in Hong Kong is escalating, with 2,086 victims identified and over $166 million in losses reported. The local police have made several arrests, including former lawyer and crypto influencer Joseph Lam. The investigation is ongoing, and more arrests are expected. 

The Securities and Futures Commission issued a warning that JPEX was operating without a license. JPEX blamed liquidity issues on third-party market makers freezing funds due to regulatory scrutiny. The exchange intends to transform into a DAO to navigate the situation.  

Bankrupt FTX Sues Salameda to Recover Millions

Bankrupt crypto exchange FTX has sued former employees of Salameda, a Hong Kong-affiliated entity, to recover $157.3m. The lawsuit alleges that the defendants fraudulently withdrew assets from FTX before the exchange's bankruptcy and exploited their connections to ensure priority treatment. 

This is not the first time FTX has attempted to claw back payments from related parties. The exchange has already targeted its ex-CEO and other executives, as well as its philanthropic and life science arms. FTX is also seeking to reclaim payments made to Genesis Global Capital, which is owned by parent company Digital Currency Group and is also bankrupt.

Bybit Suspends UK Operations Amid FCA Changes

Bybit, a crypto exchange, has decided to suspend its services in the UK due to new regulations on crypto marketing set by the Financial Conduct Authority. The suspension will affect new users from October 1 and existing users from October 8. 

Bybit's CEO, Ben Zhou, had previously stated that the rule change would likely lead to the exchange exiting the UK market. The new regulations aim to increase transparency and accuracy in the marketing of crypto products. Other crypto firms, such as OKX and Binance, are also reevaluating their strategies in response to the FCA's guidelines.  

Google Cloud Adds 11 New Blockchains to BigQuery

Google Cloud has expanded its BigQuery analytics service by adding support for 11 additional blockchains, including Avalanche, Arbitrum, Cronos, Fantom, Near, Optimism, Polkadot, Polygon, Tron, Polygon Mumbai, and Goerli. This integration allows users to conduct on-chain queries and analyze various metrics, such as the number of minted NFTs and transaction fees. 

Google Cloud initially launched its blockchain data services in 2018 with support for Bitcoin and Ethereum, and has since expanded to a total of 19 supported networks. Apart from BigQuery, Google Cloud also offers web3 infrastructure services for Ethereum, Solana, and Aptos.  

Nansen Discloses Security Breach Affecting Users

Nansen, a blockchain analytics firm, has disclosed a security breach originating from an unnamed third-party vendor. Approximately 6.8% of Nansen users were affected, with their email addresses, password hashes, and blockchain data exposed. The breach occurred on September 20, where the perpetrator gained access to an admin account. 

Nansen claims to have promptly stopped the unauthorized access and initiated an investigation, assuring users that their wallet funds remain unaffected. The company has urged the third-party vendor to publicly disclose the breach and warned users to be cautious of potential phishing attacks.  

Top Weekly Altcoin Gainers and Losers

Gainers:

Immutable X IMX (+29.16%)

Toncoin TON (+18.87%)

Aave AAVE (+16.50%)

Curve DAO Token CRV (+15.86%)

Chainlink LINK (+10.86%)

Losers:

Rollbit Coin RLB (-27.99%)

IOTA MIOTA (-11.29%)

Axie Infinity AXS (-7.56%)

Gala GALA (-7.25%)

Rocket Pool RPL (-6.22%)

NFT Market Map

OpenSea's Royalty Cuts Shift NFT Creator Landscape

OpenSea's decision to cut creator royalties has prompted NFT creators to seek alternative platforms. The move could have long-term implications for the NFT space. OpenSea's creator royalties fell 76% in two months, while Blur's royalties dropped 96%. 

However, NFT production on Ethereum has increased, indicating a recovery in creator activity. It is crucial for independent artists to have royalty revenue, and platforms that prioritize royalties may attract more artists. Diversifying across various marketplaces and blockchain options is advisable.  

Polygon and Solana See NFT Ecosystem Fluctuations

During the NFT summer in 2023, both Polygon (MATIC) and Solana (SOL) experienced significant growth in trading volume. However, their prices subsequently declined along with a drop in the overall NFT ecosystem. 

Despite the recent decline, there is a possibility of renewed interest in Polygon and Solana's NFT ecosystems in the future, as both blockchains continue to expand their respective ecosystems and new NFT collections gain traction. 

Stoner Cats NFT Faces SEC Scrutiny, Prices Surge

The Stoner Cats NFT project, co-created by Mila Kunis, has been removed from major marketplaces due to charges by the US Securities and Exchange Commission (SEC) for conducting an unregistered offering of crypto asset securities. Despite the ban, Stoner Cats NFTs remain on the blockchain and in holders' wallets. 

SC2, the company behind the project, will pay a $1 million penalty, destroy remaining NFTs, and comply with a cease-and-desist order. Despite SEC hiccups, Stoner Cat NFTs are defying gravity, with average crypto coin prices surging by a jaw-dropping 300%. This case highlights the importance of compliance with securities laws in the crypto and NFT space.  

This article has been refined and enhanced by ChatGPT.