Crypto News Headlines (06-Jun-2022)

Lithuania is the latest impatient member of the European Union seeking to jump the gun by creating its own crypto licensing regime, because EU laws might come too late to safeguard the sector’s reputation, local ministers told CoinDesk.

With Brussels’ landmark law – the Markets in Crypto Assets Regulation (MiCA) – potentially not in force until 2025, the Baltic nation wants to do its “homework” in advance, the country’s deputy finance minister told CoinDesk. But the plans for the law, which is set to be debated in the country’s parliament, are making some companies based in Lithuania fear for their future.

The EU is in the final stages of negotiating MiCA. The single authorization regime for the bloc of 27 nations has been years coming and could transform the sector by allowing businesses to tap a market of hundreds of millions. Some countries, however, can’t wait to grab their slice of the burgeoning sector.

Bitcoin mining companies are starting to feel the effects of the deceleration of the price of bitcoin in crypto markets. The company has declared that the fall of bitcoin prices, above all elements, is the most important problem that miners are facing right now. This has affected the company directly due to its holdings, taking its valuation from a unicorn status to a sub $500 million currently.

In an interview given to local media, Damian Polla, Bitfarm’s Latam General Manager, stated:

The biggest challenge facing the sector in the short term, both in Argentina and globally, is the fall in the price of bitcoin, which reduces revenues and increases operating costs.

Polla also considered this fall in prices as proof of the advance of the cryptocurrency market, which he qualified as being “mainstream” in global markets due to its correlation with other traditional equity indexes.

More than 46,000 individuals have lost over a combined $1 billion in crypto-related scams since the beginning of last year, according to the Federal Trade Commission.

Approximately $680 million in fraud was reported in 2021, and some $329 million was reported just in the first quarter of 2022, according to a report released Friday.

Social media usage while holding crypto creates “a combustible combination for fraud,” the FTC wrote. “Nearly half the people who reported losing crypto to a scam since 2021 said it started with an ad, post, or message on a social media platform.”

“And most people are still unfamiliar with how crypto works,” the report continued. “These considerations are not unique to crypto transactions, but they all play into the hands of scammers.”

The world’s largest cryptocurrency Bitcoin (BTC) has managed to register the first weekly green candle in nearly three months.

As of press time, Bitcoin is trading 4% up at a price of $30,990 with a market cap of $589 billion. On a weekly chart, Bitcoin is up 2.32%. On a technical chart, Bitcoin is still trading way above its 200-day moving average (DMA). Historically, BTC has bottomed around at 200 DMA or just below which is 25% down from the current levels. Crypto analyst Rekt Capital explains:

Historically, BTC tends to bottom at, around, or just below the 200-week MA (orange) $BTC would need to drop an additional -25% from current prices to bottom at the 200 MA.

Yuga Labs, the creator of two of the most popular ape-themed nonfungible token (NFT) offerings — Bored Ape Yacht Club (BAYC) and OtherSide — witnessed yet another orchestrated phishing attack, with investors losing over 145 Ether (ETH) or nearly $260,000 at the time of writing.

OKHotshot, a blockchain detective and a member of the Crypto Twitter community, alerted crypto investors about the compromise of two official Discord groups linked to BAYC and OtherSide NFTs.

According to OKHotshot’s investigations, the attack was conducted by hacking into the Discord account of Boris Vagner, community and social manager at Yuga Labs.

After gaining unrestricted access to the employee’s account, scammers shared various phishing links from Vagner’s Discord account into the official BAYC, Mutant Ape Yacht Club and Otherside groups.

After weeks of turbulent price movement, the cryptocurrency market has turned green, with Bitcoin (BTC) leading the recovery charge by showing signs of stabilizing above the crucial $30,000 level.

Bitcoin’s short-term positive price movement is influencing the general cryptocurrency market, which has attracted a capital inflow of $70 billion in the last 24 hours, a potential indicator that investors’ confidence might be rising.

As of June 6, the total crypto market capitalization stood at $1.29 trillion, a growth of 5.7% from the last 24 hours when the value stood at $1.22 trillion as per CoinMarketCap data.

Overall, the market cap has lost about $1.6 trillion from the all-time high recorded in November last year. Over the period, the market capitalization has plunged by over 55%.

The venture capital arm of cryptocurrency exchange Binance has made an investment in PancakeSwap, a decentralized exchange (DEX) built on the BNB Chain.

CAKE, the native token of the exchange, was up nearly 10% on Monday following the announcement.

At press time, CAKE was trading at $4.77. Despite the rally, the token is still down 36% from the $7.46 level from a month ago on the back of a challenging May for the crypto markets.

Binance Labs intends for the investment to further develop PancakeSwap’s technology, marketing and community support as well as drive Web 3-based services.

PancakeSwap, which was launched in September 2020, provides an automated market maker (AMM) allowing users to trade and swap decentralized finance (DeFi) tokens. It is is now the biggest decentralized app (dApp) on Binance’s blockchain network BNB Chain with over 400,000 users.

Binance was not immediately available for comment when contacted by CoinDesk for more detail on the size of the investment.

The SEC’s Office of Investor Education and Advocacy unveiled “a game show-themed public service campaign” last week. Titled “Investomania,” the campaign aims “to help investors make informed investment decisions and avoid fraud.”

The campaign features a 30-second TV spot, interactive quizzes, and 15-second informational videos on crypto assets, margin calls, and guaranteed returns, the SEC detailed, elaborating:

The campaign encourages investors to research investments and get information from trustworthy sources to understand the risks before investing.

In the TV spot, the game show host asks two contestants to pick a square on a video game board with investment options. They included internet rumors, celebrity endorsements, stock tips from your uncle, crypto to the moon, fear of missing out (FOMO), meme stocks, tulip bulbs, guaranteed returns, and timing the market.

The prices of Bitcoin (BTC) and Ethereum (ETH) saw a 5% jump over the last day, giving investors renewed hopes for a much-anticipated market recovery after a brutal sell-off in May.

Currently, Bitcoin is changing hands at $31,289, up 5.2% over the day, according to data provided by CoinMarketCap.

The leading cryptocurrency last traded at these levels on June 1, when it entered a downward correction that dragged the price of BTC from above $32,000 below $30,000 for the most part of the weekend.

Despite the latest spike, Bitcoin is still down more than 34% since the start of the year, with the Fear & Greed Index—a combination of variables measuring market sentiment—currently standing at 13, which corresponds to “extreme fear.”

Tom Tate, the Mayor of Gold Coast, Australia, has suggested that cryptocurrency could be used by residents to pay local taxes in future years, though critics have flagged volatility and the recent market crash as a cause for concern.

“Why can’t we pay rates on cryptocurrency if the risk is not high?” said Tate, speaking to local media outlet ABC News on June 5, just over a week before the council is due to hand down its annual budget. “The volatility is not that bad.”

Tate was elected as Mayor of the Gold Coast, Australia’s sixth-largest city in 2012, and has proven a popular choice since then, as he was re-elected for a second term in 2016 and a third term in 2020. He added that the move hasn’t been confirmed but they were looking ahead.

“It sends a signal that we’re innovative and bring in the younger generation … [but] I’m not saying we’re doing it, I’m just saying we’re always looking at the next level.”