GB Market Commentary 16/07/2021
by Alex Clark
Bitcoin is heading for its lowest weekly close in more than a month as selling pressure continues to drive prices toward $30,000. This comes after bitcoin’s biggest drop in 10 days yesterday which some attribute to the poor performance of Galaxy Digital Holdings, one of the most popular crypto related stocks, which fell 63% from its high in April. Some of the biggest losers in the market today are Ethereum (ETH) and Cardano (ADA) which are down 11%, Doge (DOGE), Polkadot (DOT) and Uniswap (UNI) which are all down 20%, Solana (SOL) which is down 16% and Chainlink (LINK) which is down 15%.
Ripple has made another small victory in its ongoing battle with the SEC as the judge ordered the deposition of Willian Hinman on Thursday. Back in 2018, Hinman said the current offers and sales of Ether are not securities transactions, and thus his removal adds weight to Ripple’s claim that the XRP token is not a security.
Real-world adoption of crypto continues as Jackson, the eighth-largest city in Tennessee, announces plans to accept bitcoin for property tax payments.
Congress takes another stab at clearing up the uncertainty around crypto by reintroducing the Securities Clarities Act, this time with cross-party support. If passed, the bill could provide greater clarity around whether newly created tokens are investment securities or investment contracts; at present, there is a distinct lack of clarity around the application of securities laws to digital assets and their trading which is slowing innovation, so this bill would go some way towards resolving this and has already garnered support from several blockchain and cryptocurrency lobbying groups.
Meanwhile, the FCA is launching an £11 million marketing campaign aimed at 18- to 30-year-olds, warning them of the risks in investing in crypto. According to the regulator, young people behave “less rationally and more emotionally, egged on by anonymous and unaccountable social media influencers.”
According to the Cardano roadmap, smart contracts will go live when the project enters its third era, Goguen, although there is speculation around when exactly this will be. A prediction market opened on Thursday allowing participants to bet on whether the Cardano blockchain will release smart contract functionality by October 1st – currently, the market leans to a prediction that smart contracts will be live on Cardano when October begins. Crucially, the Goguen era encompasses work that will make Cardano more accessible to wider audiences via Marlowe, which allows financial and business experts with no previous technical knowledge to create smart contracts.
Binance’s regulatory concerns continue as Italy becomes the 7th nation to issue a warning against the exchange. Whilst Binance is currently the largest crypto exchange in terms of traded volume and users, these warnings threaten to slow its expansion as customers go elsewhere.