Weekly recap: anti-crypto push in China, BTC’s rising dominance sends altcoins deep in red

Crypto market in numbers

After China banned financial institutions and payment companies from the cryptocurrency business, on June 22nd and 23rd, the market fell by 28% from its peak levels – down to $1.32 trillion.

The active sale of digital assets has resulted in increased trading volumes. According to CoinGecko, from June 20th to June 23rd, daily trading volumes have grown to $184.6 billion from a low of $91.6 billion.

Considering China’s negative influence, the Crypto Fear and Greed Index has also dropped down, being valued at 10 points on June 22nd. After its jump to 22 points on June 24th, it is still in the ‘Extreme Fear’ zone.

For the first time since January, Bitcoin prices have fallen below $30,000. As of June 24th, Bitcoin is trading around 49% lower than its all-time high. For most altcoins, the price fall from their all-time highs is even greater: Ethereum – 56%, Cardano – 46%, Dogecoin – 68%, XRP – 82%, Polkadot – 69%, Bitcoin Cash – 88%, and Litecoin – 68%.

According to CoinMarketCap, the Bitcoin dominance index has jumped by almost 3% – up to 46.4%. Ethereum’s market share decreased from 17.2% to 16.8%.

Bitcoin’s 30-day volatility index has dropped significantly – from 6% to 5% since June 18th. Meanwhile, Bitcoin’s 60-day volatility index continues to grow, being estimated at 5.66% as of June 24th.

All Time High

Coin	Date	ATH on EXMO
CRON	20.06.2021	1.90 USD

Gainers of the week (17th – 24th June 2021)

Ugly week – none of the cryptocurrencies showed growth at the end of the week.

Losers of the week (17th – 24th June 2021)

Coin	Opening price 17.06.2021	Opening price 24.06.2021	Change
VITAE	1.10 USD	0.44 USD	-60.3%
GAS	7.85 USD	4.49 USD	-42.8%
PRQ	0.84 USD	0.52 USD	-38.2%
BTG	57.85 USD	37.37 USD	-35.4%
HP	0.0015 USD	0.0010 USD	-33.7%

Most traded coins (16th – 23rd June 2021)

Coin	Trading volumes
BTC	48,452,358 USD
ETH	28,865,076 USD
XRP	14,030,705 USD
DOGE	4,609,398 USD
VITAE	4,298,219 USD
EXM	3,480,328 USD
BCH	1,887,575 USD
ADA	1,846,297 USD
LTC	1,820,534 USD
DASH	1,581,795 USD

Top crypto market driving factors

Bitcoin (BTC) and the overall crypto market

▲ 16.06.2021 – Santiment: Whales have accumulated 48.7% of the total Bitcoin supply in their wallets.

▼ 16.06.2021 – The US Federal Reserve increased its inflation expectation for 2021 to 3.4% from its prior 2.4% estimate.

▼ 17.06.2021 – Glassnode: Bitcoin exchange flows reversing again as investor confidence is returning.

▼ 17.06.2021 – Goldman Sachs told investors that cryptocurrency is a bad investment just a month after it was called an asset class.

▼ 18.06.2021 – Sichuan province orders Bitcoin miners to shut down before June 20th.

▼ 20.06.2021 – ByteTree Asset Management: Fund holdings in Bitcoin showing a sharp decline from 800,000 to 782,000 BTC. This is the lowest index of this year.

▼ 21.06.2021 – Tether’s (USDT) supply hasn’t grown since the start of June during Bitcoin’s price crash.

▲ 21.06.2021 – MicroStrategy purchased additional 13,005 bitcoins for around $489 million.

▲ 21.06.2021 – Bitcoin sales by miners to exchanges are decreasing despite Chinese regulations.

▼ 21.06.2021 – The People’s Bank of China urges banks and payment systems to stop participating in Bitcoin transactions and cryptocurrency speculation.

▼ 21.06.2021 – Glassnode: Bitcoin active addresses have fallen by 24% from the latest sustained peak. USD value settled on the network declined by 63%. Bitcoin total fees paid are coincident with levels of early 2020.

▼ 21.06.2021 – CoinShares: Bitcoin has seen its sixth consecutive week of outflows. This is the longest run of outflows since February 2018.

▼ 22.06.2021 – CryptoQuant: The whale surrender index pointed out continued negative dynamics of the bitcoin price in the future.

▼ 22.06.2021 – CryptoQuant: on June 21st, there was the highest daily spike in BTC Inflow Mean to Spot Exchanges since the March 2020 crash.

▼22.06.2021 – CNBC’s “Mad Money” host said he sold most of his Bitcoin following China’s crackdown on crypto miners.

▲▼ 22.06.2021 – Increased Bitcoin and stablecoin inflows to exchanges recorded. Analysts predict higher market volatility.

▲ 22.06.2021 – Glassnode: the balance between Bitcoin supply held by Long and Short term holders has similarities to the 2017 market top. What is different about this cycle is that long-term holders have stopped spending their coins.

▼ 23.06.2021 – CryptoQuant analysts announced huge BTC outflows from exchanges on June 22nd and 23rd.

▲ 23.06.2021– Ecoinometrics: Hedge funds and other big investors are increasing their long and reducing their short positions on the Chicago Mercantile Exchange (CME). Meanwhile, private retail investors are reducing both long and short positions.

▼ 23.06.2021 – Arcane Research: Open interest in bitcoin futures is now down 59% from mid-April.

▼ 23.06.2021 – Timothy Peterson, Investment Manager at Cane Island Alternative Advisors: Bitcoin mempool has cleared out for the first time since November 2020, which can be a good indicator of bubbles.

▲ 23.06.2021 – ARK Investment Management bought 1 million shares of Grayscale Bitcoin Trust (GBTC) worth about 1,000 BTC.

Ethereum (ETH)

▲18.06.2021 – Ethereum’s ‘London’ hard fork to go live on the testnets starting from June 24th. If no issues are detected, the mainnet upgrade will occur on July 14th.

▼ 21.06.2021 – Ethereum active addresses have fallen by 30% from the latest peaks. USD value settled on the network declined by 63%. USD value settled on the network declined by 68%. Miner revenue from transaction fees has fallen to levels seen before DeFi summer 2020.

▼ 21.06.2021 – Ethereum saw outflows of $1.9 million over the past week.

▲ 23.06.2021 – Bank of Israel adopts Ethereum blockchain technology for digital shekel testing.

Ethereum Classic (ETC)

▲ 21.06.2021 – Digital Currency Group (DCG) to purchase a total of $50 million worth of shares of Grayscale Ethereum Classic Trust that holds Ethereum Classic.

Dogecoin (DOGE)

▼ 21.06.2021 – President of the Federal Reserve Bank of Minneapolis called Dogecoin a Ponzi scheme.

▲ 22.06.2021 – Dogecoin community to discuss 10x network fee reduction. The hard fork may occur next week. Developers have no doubts that the miners will support this proposal.

Polkadot (DOT)

▼ 21.06.2021 – Polkadot investment products saw inflows last week, for the first time since the beginning of June.

Chiliz (CHZ)

▲ 17.06.2021 – Coinbase Pro added trading support for Chiliz.

Ripple (XRP)

▲ 18.06.2021 – Judge Sarah Netburn has denied U.S. Securities and Exchange Commission’s (SEC) request for documents related to Ripple’s lobbying efforts.

Tezos (XTZ)

▲ 17.06.2021 – McLaren Racing partners with Tezos to build an NFT fan experience platform.

Waves (WAVES)

▲ 16.06.2021 – Waves presented its monthly digest that summarises the Waves ecosystem’s major achievements as of May 2021.

▲ 18.06.2021 – The Waves Ducks universe launches the NFT farming feature.

EOS (EOS)

▲ 23.06.2021 – The Bullish crypto exchange, launched by EOS developers, plans to raise capital via a merger with a special-purpose acquisition company (SPAC).

0x (ZRX)

▲ 18.06.2021 – Grayscale Investments is considering 13 additional crypto assets for its investment product options, including 0x (ZRX).

Crypto market trends

Regulation

📊 The Central Bank of China has banned banks and payment systems from participating in transactions with cryptocurrencies and ordered them to suppress such activities in every possible way. China’s largest cloud provider, Alibaba Cloud, has warned of a possible shutdown of Chinese crypto companies’ servers in accordance with new regulatory requirements.

📊 The Central Bank of Indonesia has banned the use of cryptocurrency.

📊 South Korean banks are reviewing the feasibility of cooperating with local crypto companies.

📊 The Governor of the Bank of England, Andrew Bailey, said that cryptocurrency companies should not count on regulatory easing and “free permission” to implement innovations. Bailey stressed that the regulator is not against innovation, but seeks to “put things in order” in the sector.

📊 Malta has come under scrutiny by the Financial Action Task Force (FATF) due to the multi-billion dollar cryptocurrency transactions that have passed through the country since 2017.

📊 India may impose an additional 2% tax on cryptocurrencies purchased on foreign exchanges.

📊 The US Securities and Exchange Commission (SEC) has once again postponed a decision on applications for the launch of a Bitcoin exchange fund created by VanEck and Valkyrie Digital Assets. At the same time, another working group for the study of cryptocurrencies has been created in Congress.

📊 The government of El Salvador is working on legislative amendments for calculating salaries in BTC.

The opposition party, Farabundo Martí National Liberation Front, has initiated legal proceedings, arguing that the legalization of bitcoin is unconstitutional.

📊 The World Bank refused to assist El Salvador in the implementation of the first cryptocurrency.

📊 Panama and Paraguay will consider bills to recognize bitcoin as a legal tender in July. Bank of America analysts believe digital currencies can spur economic growth in developing countries.

Mining

📊 Miners in Sichuan were forced by local authorities to shut down before on June 20th by local authorities. As a result, the Bitcoin hash rate fell by almost 50% over the past month.

📊 The secondary market is flooded with mining equipment from China – prices have fallen by 30% on average. The largest manufacturer of ASIC miners for bitcoin mining Bitmain Technologies has suspended sales.

📊 Despite the fact that Kazakhstan introduced energy consumption taxes, BIT Mining Limited and Canaan Creative are delivering Mining Machines to the country. U.S.-based mining company Wattum Management plans to build a Kazakhstan mining farm in conjunction with the local company Energix.

📊 Three mining companies were approved for listing on Nasdaq over the past week, including Hut 8, HIVE and Bitfarms.

📊 The U.S. House of Representatives voted to pass to pass the Environmental, Social and Governance Disclosure Simplification Act of 2021. This could have a heavy blow to the stock prices of mining companies.

📊 Miami Mayor Francis Suarez hopes to attract miners from China with low-cost nuclear power.

Acceptance of cryptocurrencies

📊 Auction house Sotheby’s and telecommunications provider GoldConnect announced that they are ready to accept crypto payments. General Motors is also considering Bitcoin as payment.

📊 US House Republican becomes first national party to accept cryptocurrency donations.

📊 According to U.K. regulator the Financial Conduct Authority, the number of UK adults who invest in crypto is estimated at 2.3 million, representing a rise of 400,000 since last year.

📊 One of the largest banks in Spain, BBVA, launched a bitcoin trading service for private banking clients in Switzerland interested in digital asset investment.

📊 Multinational investment bank Goldman Sachs is now trading bitcoin futures blocks with Galaxy Digital Holdings. The bank also reportedly traded digitised treasury bonds for JPM Coin on JPMorgan Chase’s Onyx blockchain platform.

Big business

📊 According to PitchBook, venture capital funds have poured $17 billion into cryptocurrency companies since early 2021. It’s more than the combined investment amount of the previous 3 years. The last time a large inflow was recorded in 2018 with $7.4 billion in venture capital investments.

📊 Payment service companies PayPal and Visa have become limited partners of the cryptocurrency investment fund Blockchain Capital. PayPal has also become one of the investors in blockchain analytics company TRM Labs.

📊 Securitize, a digital-asset securities firm, raised $48 million in a Series B fundraising round co-led by Morgan Stanley and Blockchain Capital. Morgan Stanley’s wealth management clients may soon be able to invest in the New York Digital Investment Group bitcoin fund.

CBDC

📊 The Bank for International Settlements says central bank digital currencies (CBDCs) can form the basis for a digital payment system.

📊 European Central Bank (ECB) has noted that a digital euro offers superior privacy protections than privately issued stablecoins. Analysts at Morgan Stanley have estimated that a digital euro could suck away 8% of eurozone banks’ customer deposits. Small countries such as Greece, Latvia, Lithuania and Estonia will suffer the most.

📊 Bank of Israel confirms the digital shekel CBDC pilot project underway.

📊 Bloomberg says that central bankers talk down concerns over digital currency risks.

That’s all for this week! Follow EXMO on YouTube, Twitter, and Telegram to stay tuned to the main events and trends in the crypto market.

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