top of page

Elon Musk's Market Manipulation Targeted By Proposed EU Regulation

GB Market Commentary 07/07/2021

by Alex Clark



Bitcoin had risen as much as 3.7% yesterday to $35,094 before dropping back as Chinese regulators punished a company that was suspected of providing software services for virtual currency transactions. Dialling up the pressure, they have also warned institutions not to provide other services related to virtual currency, including providing business premises or marketing. I think this is, in part, to ensure the adoption of China’s central bank digital currency, which could enable the government greater power and financial surveillance.


Despite the recent downturn, Marshall Wace, a London-based asset management firm with over $55 billion in AUM, is considering a foray into the cryptocurrency market. Beyond trading, the asset manager is looking to invest in companies that are involved in the infrastructure of the industry, including those involved in blockchain technology and payment systems.


Ethereum’s core developers have proposed block 12,965,000 for the mainnet activation of the London network upgrade, which should be between 14:00 BST and 18:00 BST on August 4th, 2021.


The price of Aave shot up by 16% yesterday after confirming the launch of institutional investor platform Aave Pro in July. At the time of writing, the asset is trading at $319.34, up 40% in the past 7 days.


The European Commission’s proposed ‘Regulation on Markets in Crypto Assets’ (MiCA) is advancing and has an ‘Elon Musk’ clause; once in force, the proposal would prohibit so-called ‘market influencers’ from utilizing social or conventional media to shift the price of cryptocurrencies. Other aspects of the regulation relate to fiat-pegged stablecoins, such as Tether (USDT) and USD Coin (USDC) which would have to seek authorization from the regulatory authorities to enable their trade in the EU. Given that it’s easier to monitor crypto profits if they are traded into fiat money rather than kept in stablecoins, this is likely a measure to protect the interests of national tax authorities. Finally, the regulation also creates a regulatory and legal hurdle for new crypto projects by, for instance, requiring them to be established as a legal entity in one of the member states, which would make it harder for small players to enter the market.


Nigeria’s Government has failed to halt cryptocurrency as more and more citizens turn to peer-to-peer transactions in order to bypass the country’s inflating currency. A survey by Statista in March found that 32% of respondents in Nigeria use crypto and, similarly, Nigeria ranked eighth in the world for cryptocurrency adoption in Chainalysis’ 2020 report. This is part of a larger regional trend with Africa seeing a 390% increase in P2P trade volumes on Binance since January.


Vietnam finally joins the crypto bandwagon as the Prime Minister releases a statement asking the country’s central bank to start a cryptocurrency program. Vietnam had previously been opposed to cryptocurrencies, refusing to give them any legal recognition and prohibiting banks from using crypto as a payment option, which makes this decision all the more surprising.


El Salvador’s ambitious plans to harness volcanic geothermal energy to power Bitcoin mining rigs is set to generate 95MegaWatt of power, which is enough to mine around 1800 BTC in revenues per month or $750 million per year. Not only will this help to recover some of the hashrate lost by the closure of Chinese mining operations, but it will provide significant revenue to the country’s economy.


Switzerland’s Sygnum Bank has announced it will become the first bank to offer Ethereum 2.0 staking, signalling that clients may be able to earn returns of up to 7% per annum.



bottom of page