This Week in Crypto: Regulatory Crackdown, Macro Backdrop Kill Momentum

After two weeks of bullish crypto momentum, Bitcoin’s (BTC-USD) profitable streak ended abruptly this week. The legacy token was on the verge of beating its 10-year-old document of sustaining 15 consecutive days of inexperienced candles. Nonetheless, the streak ended on January 18 after BTC dropped beneath assist at $21,500. 

At writing, BTC was consolidating just under the $21,000 mark. BTC’s pullback from earlier weekly highs might be attributed partly to the U.S. Division of Justice’s (DOJ) resolution to unveil an “international cryptocurrency enforcement action” on January 18. 

One other potential purpose behind retreating Bitcoin costs was the U.S. Producer Value Index (PPI) determine launched this week. Opposite to expectations, December 2022’s producer price index (PPI) stood at 6.2% year-over-year (YoY) in comparison with the earlier determine of seven.3%, signaling easing inflation. With buyers speculating that the U.S. Federal Reserve could sluggish its tempo of rate of interest hikes, BTC and different main cryptocurrencies skilled a pointy sell-off that shrunk weekly returns after the information was revealed.

Solana Leads Altcoins to the Upside

Most altcoins have been capable of maintain the earlier week’s upward momentum, with Solana (SOL) establishing itself as one of many main outperformers on the upside. Following months of declines within the aftermath of the FTX meltdown, SOL registered a formidable 31% achieve over the past week, primarily attributable to elevated developer exercise, consumer adoption, and a sequence of promising bulletins.

Whereas a number of different altcoins additionally recorded double-digit returns, this week’s standout efficiency got here from Decentraland (MANA), Frax Finance (FRX), and Aptos (APT). The worth of Decentraland (MANA) jumped by almost 67.37% this week after the metaverse platform revealed its partnership with the Australian Open (AO) tennis event. 

In the meantime, Ethereum (ETH-USD) -based mission Frax Finance (FRX) propelled its means into the highest 100 cryptos by capitalization this week after surging 65% over the past seven classes. This constructive value motion within the worth of FRX and different liquid staking cryptocurrencies might be related to Ethereum’s upcoming “Shanghai” improve, after which customers can withdraw their Ethereum presently staked to validate community exercise.

Aptos’ APT token was one other robust performer after leaping by roughly 54% this week. The worth of the Layer-1 blockchain’s native APT token surged following information that Web3 infrastructure supplier Moralis might be integrating with Aptos. The contemporary integration will add assist for all present API endpoints, construct a devoted Aptos API, and incorporate real-time information streaming through webhooks from Aptos to Moralis.

Monero and ApeCoin Face Relentless Resistance

Regardless of the broadly constructive efficiency recorded throughout the crypto panorama over the past seven classes, Monero (XMR) and ApeCoin (APE) considerably underperformed their friends after each tokens misplaced almost 5% of their worth. Monero’s falling hashrate is among the many key causes behind this week’s drop in worth. The worth of XMR briefly rallied final week however started consolidating quickly after and is presently buying and selling 70% beneath its earlier all-time excessive.

ApeCoin (APE), however, continues to battle value corrections attributable to a constant drop within the variety of each day energetic customers on the community. The asset’s buying and selling quantity has steadily dipped in latest weeks amid weak investor sentiment as a result of surprising decline in its open curiosity (OI) price.

Australia’s New Stablecoin, a $500 Million Web3 Fund, and Extra

Amid the rising curiosity in digitizing nationwide currencies and central financial institution experimentation, the Nationwide Financial institution of Australia (NAB) is the most recent central financial institution to unveil blockchain initiatives with a plan to launch an AUD-pegged stablecoin atop the Ethereum blockchain by mid-2023. The AUDN stablecoin goals to streamline cross-border transactions and carbon credit score buying and selling, serving to customers overcome hassles related to the SWIFT fee community.

Switching gears to funding and funding tendencies, enterprise capital agency Hashkey Capital has closed a $500 million funding spherical. These funds might be allotted throughout infrastructure, instruments, and functions designed to speed up the mass adoption of blockchain, Web3, and different rising applied sciences. On the identical time, SkyBridge Capital’s Anthony Scaramucci has invested in a brand new crypto firm based by FTX US’s ex-President Brett Harrison.

Final however not least, the US Division of Justice (DOJ) has carried out an “international crypto enforcement action” in coordination with France towards Hong Kong-based P2P crypto platform Bitzlato and its founder Anatoly Legkodymov for involvement in unlicensed cash transmissions value greater than $700 million. The information sparked a right away sell-off throughout the crypto ecosystem earlier than a modest rebound from lows took maintain.

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