FTX, the embattled company whose meltdown caused the ongoing crypto winter appears to be in the news once again, as it looks to liquidate its crypto assets worth $3.4 billion. The news has led to an overall ‘sell’ sentiment among investors, leading to a gloomy outlook on the overall market. However, the recently concluded G20 Summit in New Delhi offered a positive outlook on crypto regulation as benefits of central bank digital currency (CBDCs) in its official leaders’ statement. It remains to be seen how the next G20 finance meeting will translate to some positivity in October.
Before we proceed further, readers should note that the overall crypto market and coin prices are extremely volatile in nature. There are no foolproof methods to ascertain how cryptocurrencies are expected to behave in the future. This article is aimed at helping investors stay on top of the current market scenarios and the biggest events that have already taken place as well as some upcoming occurrences that are worth noting. Investors are advised to do their own research before taking any call.
Crypto Prices Over The Past Week
Last Monday (September 4), the overall crypto market cap stood at $1.05 trillion. BTC price stood at around $26,000, ETH price stood at around $1,640.
A week later, the overall market cap dipped to $1.03 trillion.
DeFi’s total volume stands at $1.79 billion, at 8.41 percent of the total market 24-hour volume. In the case of stablecoins, the overall volume stands at $19.37 billion, at 90.84 percent of the total 24-hour market volume. As per CoinMarketCap, the overall market fear and greed index stood at ‘Fear’, at 35 points (out of 100).
BTC dominance, at the time of writing, stood at 48.56 percent.
Over the past seven days, Bitcoin achieved a high of $26,401.24 (on September 8) and a low of $25,476.79 (September 6).
Ethereum, on the other hand, saw a high of $1,654.83 (September 8) and a low of $1,604.89 (September 10).
Crypto Events To Note
FTX is anticipated to secure legal approval for the liquidation of approximately $3.4 billion worth of cryptocurrencies. Speculations suggest that FTX may obtain the go-ahead for this liquidation by September 13, causing concern among stakeholders regarding its potential impact on the market. FTX’s legal filings indicate an intention to sell off digital assets worth up to $100 million on a weekly basis, with occasional flexibility to extend this limit to $200 million.
It is primarily believed that the FTX move might lead to increased pressure of selling among crypto owners.
Furthermore, in a comprehensive court submission spanning more than 180 pages, financial consultants representing FTX have provided an exhaustive account of individuals and entities that received compensation as part of the company’s marketing campaigns. This disclosure is essential for evaluating whether these payments fall within the criteria permitting insolvent firms to reclaim funds.
Among the recipients listed are notable personalities such as Shaquille O’Neal, the former basketball professional, who received $750,000. Additionally, Tennis sensation Naomi Osaka was compensated with over $300,000, while former baseball star David Ortiz received more than $270,000. American football quarterback Trevor Lawrence also featured on the list, having received over $200,000.
Meanwhile, on a positive note, Prime Minister Narendra Modi on Saturday announced that the G20 had reached a unanimous agreement on a leaders’ declaration. He credited this accomplishment to the combined efforts of all participating teams and shared the adoption of the G20 Leaders Summit Declaration during his address to the leaders assembled in New Delhi. Among various noteworthy developments, it appears that the long-debated global coordination regarding the regulation of cryptocurrencies has taken a significant step forward. Finance Minister Nirmala Sitharaman stated that there is growing international consensus on policies related to virtual digital assets (VDAs).
Sitharaman remarked, “There is a global push for more transparent policies regarding crypto assets, and we are witnessing the emergence of a global consensus.” The Union minister also emphasized that the presidency will lend its support to the International Monetary Fund (IMF) and the Financial Stability Board (FSB) in establishing a globally coordinated regulatory framework for cryptocurrencies.
This could be considered a positive development, as official regulations will not only bring in much-needed legitimacy to the sector but also ensure misuse of the assets by bad actors and avoid mishandling of customers’ money à la FTX.
The upcoming G20 finance ministers and central bank governors’ meeting in October will discuss the IMF-FSB paper on crypto assets.
What Crypto Traders Are Saying About Current Market Scenario
Mudrex co-founder and CEO Edul Patel told ABP Live, “Bitcoin has been trading above the $25,700 mark over the weekend. Friday saw Bitcoin’s price rise above $26,000. However, the bullish momentum faltered in the face of bearish market sentiments, highlighting a tug-of-war between the bulls and bears. Bitcoin currently faces resistance at $26,500, while a drop in price from the current level would find support at $25,300. Bitcoin’s price has not gathered significant strength to make a sharp move. It is likely that Bitcoin might trade sideways for a few days. In the meantime, Ethereum remains steadfast in its trading position above $1,600.”
WazirX Vice President Rajagopal Menon offered his take, “A general emphasis on the Common Reporting Standard and Crypto-Asset Reporting Framework by G20 leaders, indicates an incoming ecosystem where data is transparent. This could impact the sentiments of stakeholders worldwide. FTX potential liquidation might trigger a sell-off of assets in the coming weeks, a concern among market participants. Venture Capital continues to make inroads in DeFi with hundreds of millions invested this year so far.”
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Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.