Crypto News Headlines (18-Jan-2023)

Last week, U.S. Treasury Secretary Janet Yellen warned that the government would reach its statutory debt limit of $31.4 trillion on Jan. 19.

Understandably, that’s scary and might force crypto investors to reconsider the sustainability of bitcoin’s (BTC) recent rally. After all, we are talking about the government of the world’s largest economy with the deepest financial markets and one that controls the supply of the global reserve currency, the greenback, reaching the limit on how much it can borrow to fund its operations.

Still, it’s no time to panic, as the shutdown won’t happen immediately. Yellen has promised to implement “extraordinary measures” to help the government meet its obligations for at least five months, buying a few months for Congress to end the deadlock and increase the so-called debt ceiling to avoid a shutdown.

And these measures could bode well for risk assets, including cryptocurrencies, according to analysts.

Bitcoin (BTC) and ethereum (ETH) prices have risen significantly against the U.S. dollar, causing a cascade of short liquidations on Jan. 14. The cryptocurrency exchange Bitfinex discussed the matter in its most recent Alpha report #37. When a trader opens a short position against bitcoin or ethereum, they expect the price of the crypto assets to decline in the future.

However, if bitcoin’s price climbs quickly, short traders either get liquidated or must buy back the bitcoin at a higher price. When the price of BTC or ETH rises too much, short sellers are liquidated, meaning their short position is closed by the crypto derivatives exchange. According to Bitfinex researchers, a significant number of liquidations took place on Jan. 14.

Crypto-focused asset manager HashKey Capital has raised another $500 million for investments in the Web3 ecosystem.

“Web3” describes an emerging set of blockchain-based technologies that are ushering in a new, decentralized era of the internet, including crypto, DeFi, and NFTs.

HashKey’s fund, “FinTech Investment Fund III” (Fund III), received commitments from a range of institutional investors, “including sovereign wealth funds, corporations, and family offices,” per an announcement from HashKey on Tuesday.

“Fund III will follow our time-tested investment principles while also looking for game-changers, which would be those that will propel the industry forward into the next stage,” HashKey Group Chairman Dr. Xiao Feng said in the announcement.

The popular NFT influencer and blogger NFT GOD has fallen victim to a phishing scam on Google Ads. This led to a breach of all his accounts and the theft of his blue-chip non-fungible tokens (NFTs) and digital assets.

NFT GOD Loses it All in Phishing Attack

On Sunday, January 15th, NFT influencer and blogger NFT GOD, also known as Alex, reported that on January 14th, his personal and professional accounts were compromised, leading to the theft of his NFTs and digital assets. He tweeted:

Last night my entire digital livelihood was violated. Every account connected to me both personally and professionally was hacked and used to hurt others. Less importantly, I lost a life changing amount of my net worth

Research shows that Dogecoin DOGE  tickers down $0.09 was the only memecoin in 2022 to proactively reduce its carbon footprint — a key metric for mainstream adoption —  by 25% in one year, thanks to the intervention of developers and Tesla CEO Elon Musk.

One of the main reasons why Musk backtracked on accepting Bitcoin BTC tickers down $21,216  payments for Tesla was high carbon emissions. At the time, he believed that Dogecoin — “even though it was created as a silly joke” — was better suited for transactions.

Owing to proactive efforts from Musk and the members of the Dogecoin ecosystem, Dogecoin saw a 25% decrease in its annual CO2 emissions. With 1,423 tons of emissions released in 2021, Dogecoin produced 1,063 tons in 2022, according to research from Forex Suggest.

Crypto companies in France would have to seek authorization from regulators to operate if they are not already registered with the country’s financial regulator by Jan. 1, 2024, under plans adopted by lawmakers at the National Assembly on Tuesday.

The plans offer more leeway than the Senate, which proposed in December to offer a cut-off date of October 2023, in a bid to stop crypto companies abusing new European Union rules known as the Markets in Crypto Assets (MiCA) regulation.

“I propose to take the date of January 1, 2024, to let new entrants have a little more time to ask for their authorization, which is complicated,” as well as offering more time to the Financial Markets Authority to process applications, said Daniel Labaronne, who is holding the pen on the new legislation on behalf of the Assembly’s Finance Committee.

Former Securities and Exchange Commission (SEC) official John Reed Stark has warned the crypto industry of an escalating “regulatory onslaught.” Stark founded and served as chief of the SEC Office of Internet Enforcement for 11 years. He was also an SEC enforcement attorney for 15 years where he led cyber-related projects, investigations, and enforcement actions.

Stark explained in a tweet Thursday that the SEC “hit Blockfi for failing to register its crypto-lending program, stopped Coinbase from launching its crypto-lending program, and Just hit Gemini/Genesis for its Earn crypto-lending grift.” He warned:

Buckle up: An SEC regulatory onslaught is just beginning.

Last week, the SEC charged crypto exchange Gemini and crypto lender Genesis “for the unregistered offer and sale of securities to retail investors through the Gemini Earn crypto asset lending program.” In February last year, the regulator took action against cryptocurrency lending platform Blockfi which filed for bankruptcy in November.

The price of Shiba Inu (SHIB) has spiked today, currently up 15.2% over the last 24 hours and 31.2% over the past seven days, per CoinGecko.

SHIB is currently ranked the 13th-largest digital asset by market capitalization, but its price of $0.000012 is having one of the best days out of the top 100 cryptocurrencies. The meme coin is also posting a nearly 200% increase in 24-hour trading volume, with Binance and Coinbase hosting the majority of those trades.

As has often been the case in previous market cycles, altcoins are experiencing strong rallies subsequent to those of the market leaders, such as Bitcoin and Ethereum—perhaps due to traders reinvesting profits from large-cap assets into smaller ones.

The Bitcoin (BTC) price rebound to a multi-month high has also positively affected mining stocks. Many crypto-mining stocks recorded their best monthly performance in a year. The surge in mining stocks also relieved the troubled miners who had to sell a significant chunk of their mined coins to boost liquidity in 2022.

Bitfarms — one of the top BTC mining firms — registered a 140% surge in the first two weeks of January 2023, followed by Marathon Digital Holdings with a 120% surge. Hive Blockchain Technologies saw its stock value nearly double in the same period, while the MVIS Global Digital Assets Mining Index is up by 64% in the first month of the new year.

The Luxor Hashprice Index, which aims to quantify how much a miner might make from the processing power used by the Bitcoin network, has increased by 21% this year. This partly reflects larger rewards due to an increase in the price of Bitcoin.

The share price of cryptocurrency exchange Coinbase has surged by 69% since its all-time lows, and other crypto-related stocks including business intelligence firm MicroStrategy have recorded similar jumps — it’s been green candles all around since the start of 2023.

The share price of Coinbase fell as low as $31.95 on Jan. 6, before shooting up to $54.14 by the close of trading on Jan. 17.

The rising share price will likely be accompanied by a huge sigh of relief for Coinbase executives after a challenging 2022 saw it cut 20% of its workforce and wind down its Japanese operations. Despite the surge, COIN remains more than 84% below its all-time high.

Other crypto-related stocks such as MicroStrategy and digital payments company Block Inc. have also posted strong gains in the new year.