This Week in Coins: Market Falls as Bitcoin and Ethereum Fall Over 10%
This week in coins. Illustration by Mitchell Preffer for Decrypt.
There was a limit to crypto’s growth this week as the market continues to price the impact of another possible interest rate increase from Fed. Those indications led to a stronger dollar but halted the crypto rally last week, which was spurred when Ethereum’s “Shapella” the upgrade went live.
This week’s news was a veritable feast of regulatory stories in both the US and the EU, with the drama in Washington centered on the SEC’s ongoing crackdown on crypto businesses—1,500 to date indeed, according to a tweet on Monday by Chairman Gary Gensler, who is celebrating his second year as the top US securities regulator.
Bitcoin and Ethereum both fell this week. Bitcoin occasionally kept its head above $30K, but finally began to fall on Wednesday, spiral down to its current level of $27,340, down 10.3% from last week.
Ethereum had a similar trajectory, occasionally holding its head above $2,100 until midweek, before sinking to $1,851, a seven-day loss of 11.7%.
Many of the top thirty cryptocurrencies by market capitalization had losses of just over 10%, including XRP, which is worth $0.456866, Cardano (ADA) is trading at $0.392358, Dogecoin (DOGE) is at $0.079389, Polygon (MATIC) is $1.01, Solana (ADA) SOL) changes hands at $21.45, Polkadot (DOT) trades at $5.91, Litecoin (LTC) is $86.36, Avalanche (AVAX) is $17.16, Uniswap (UNI) trades for $5.48, Cosmos HUB (ATOM) is $10.91, and Stellar (XLM) is sitting at $0.093942 at the time of writing.
US regulators crack down, EU regulators promise
The US Securities and Exchange Commission’s (SEC) crackdown on crypto firms made headlines on Monday when the agency sued yet another major crypto firm for alleged non-compliance with securities laws, Seattle-based exchange Bittrex.
In its lawsuit, the SEC named six cryptocurrencies that Bittrex allegedly offered as unregistered securities: OMG Network (OMG), Dash (DASH), Monolith (TKN), Naga (NGC), Real Estate Protocol (IHT) and Algorand (ALGO).
The drama quickly continued on crypto Twitter where a clip of Gensler praises Algorand made the rounds. It’s from a 2019 talk Gensler gave at the MIT Sloan Idea Exchange, a conference hosted by the school when Gensler was a professor of global economics and management there.
Several Republican lawmakers responded to the SEC’s strategy of regulation by enforcing by filing a letter of condemnation to the House Financial Services Committee on Tuesday. During the hearing, Rep. Tom Emmer Gensler, saying, “You’ve been an incompetent cop on the beat,” before claiming that the SEC chair pushed American firms into “CCP’s hands (Chinese Communist Party).”
On Wednesday, the committee turned its attention to stablecoins. Republicans and Democrats collided over a proposed bill, for the time being called “To be added Act of 2023.” Democrat Maxine Waters said she had never completed negotiations with Republican Patrick McHenry and that lawmakers are now starting from scratch. Democrat Stephen Lynch also criticized some of the proposed legislation.
Good news came from the Texas legislature on Friday. Texas House of Representatives approved a bill requires local crypto exchanges to maintain sufficient reserves to meet all obligations to customers.
Ultimately, the European Union was where the most progress was made on crypto legislation this week. The European Parliament passed the Markets in Crypto Assets (MiCA) bill by 517 votes to 38, with 18 abstentions, at a meeting in Strasbourg on Thursday.
The legislation means that the bloc’s 27 member states will now take a unified approach to crypto. Companies have a year and a half to familiarize themselves with the rules. The stablecoin legislation will not come into effect until July 2024, and the rest of the legislation will not be implemented until January 25.
