Crypto News Headlines (29-May-2023)

Bitcoin’s (BTC) near-term outlook appears constructive as blockchain data show short-term holders of the cryptocurrency are moving coins at a profit.

The seven-day moving average of the short-term holder’s (STH) spent output profit ratio (SOPR) has recently moved back above 1, according to blockchain analytics firm Glassnode.

“After a brief stint of coins moving at a loss, STH-SOPR is now back above 1,” analysts at Blockware Solutions said in a weekly newsletter. “This is bullish for near-term price action as it shows capitulation from short-term holders.”

At the start of the year, products incorporating artificial intelligence (AI) witnessed substantial demand with the rise of AI-focused software noted throughout 2023. This trend permeated into the cryptocurrency sphere, resulting in up to 74 AI-centric tokens amounting to a value of $4.03 billion by the end of February. At its peak, the AI crypto market recorded a $444.39 million 24-hour trade volume on February 27, 2023.

Presently, both trade volume and market valuation within the AI crypto sector have significantly decreased. Data from reveals that a total of 89 crypto assets tied to AI are currently valued at $2.93 billion.

AI-Centric Crypto Market Loses Over $1 Billion in Value in 90 Days

Despite an additional 15 AI-centric tokens being introduced, $1.1 billion in value has exited the AI crypto space in the past 90 days. On Sunday, May 28, approximately $409 million worth of trades took place involving AI-focused tokens.

Bitcoin and Ethereum continued to climb along with stocks as U.S. lawmakers ended their stalemate over the federal government’s debt ceiling, boosting risk-on sentiments in the market.

Bitcoin touched $28,000 Monday morning, with Ethereum breaking above $1,900. At time of publication, Bitcoin stands at just under $28,000, up 2.9% on the day, with Ethereum holding above $1,900, up 3.2% in the last 24 hours, per CoinGecko.

A protracted stand-off between Democrats and Republicans over the federal government’s $31.4 trillion debt ceiling appeared to end this past weekend, as U.S. President Joe Biden and Republican House speaker Kevin McCarthy reached a tentative deal on Saturday evening.

Floki (FLOKI) spiked over 10% on Sunday and saw its highest trading volumes in over three weeks as traders bet on the tokens amid a China-focused push for its Valhalla metaverse game.

Trading volumes for the tokens, which are fashioned after the Shiba Inu dog breed, jumped to over $60 million, up from last week’s $25 million average. The spike comes as ads for its Floki game featured in some Chinese sporting tournaments. This could have attracted some speculators who hypothesized that the move might attract new traders from China.

In a tweet, Floki developers said they saw an influx of Chinese-based community members on their social media groups.

Floki previously said it was targeting China in its latest push toward attracting more users for its Valhalla game, as previously reported. The game’s content and technical documents will be available in both traditional Chinese and simplified Chinese and are specifically targeted toward the Chinese gaming market, developers added at the time.

Cryptocurrency exchange Bybit continues the expansion of its operations after receiving “in-principle” approval from regulators in Kazakhstan.

On May 29, the exchange announced its pre-approval from Kazakhstan’s Astana Financial Services Authority (AFSA) to operate as a digital asset trading facility and custody services provider at the Astana International Financial Centre (AIFC).

Ben Zhou, co-founder and CEO of Bybit, said he believes in the “promising potential” of the Commonwealth of Independent States (CIS) as a region for growth in the crypto industry.

Zhou also stressed Bybit’s commitment to compliance with local regulations. This comes after Bybit was recently flagged by regulators in Japan for operating without registration.

“It has always been our primary objective to operate our business in compliance with relevant rules and regulations.”

Developers behind the Arbitrum-based Jimbos Protocol are gauging the best way for the project to move forward after its version 2 (V2) faced a $7.5 million exploit over the weekend.

Jimbos said it was working with security researchers to reclaim lost funds – the same people who’ve previously helped Euler Finance recover over $200 million – and added that they would contact law enforcement by 4 P.M. UTC on Monday if the attacker failed to return the money.

Jimbos lost 4,090 ether (ETH) late on Saturday, which security analysts blamed on the lack of slippage control in the main contract. This allowed the yet-unidentified attackers to take out a $5.9 million flash loan, manipulate the prices of jimbo (JIMBO), and walk out with treasury funds.

Global cryptocurrency exchange Binance has announced that it is launching a local crypto trading platform for residents of Japan this summer. Binance wrote:

We are pleased to announce that we have created a new platform for residents in Japan in order to fully comply with local regulations.

“The new platform will be available this summer. We will inform the launch date and provide further details in the coming months,” the global crypto exchange continued.

The services offered by Binance’s global platform will be discontinued for Japan residents on Nov. 30, the announcement adds. “Users of the global platform will be able to migrate to the new local platform through a new identity verification process (KYC), which will be available after August 1, 2023.”

As the details of the agreement reached between President Joe Biden and House Speaker Kevin McCarthy on the U.S. debt ceiling were made public Sunday, one notable part of the deal appears to have blocked some taxes proposed by the Biden administration, including the Digital Asset Mining Energy (DAME) excise tax.

If passed, it would impose a 30% tax on cryptocurrency mining firms—a move that the Biden administration argued was required to limit the environmental and societal damage caused by crypto mining operations.

Dennis Porter, CEO of Bitcoin mining advocacy group the Satoshi Action Fund, questioned whether “the Administration’s DAME excise tax proposal is gone?” given that Bitcoin mining wasn’t mentioned in the text of the bill, dubbed the “Fiscal Responsibility 5 Act of 2023.” U.S. Congressman Warren Davidson (R-OH-08) responded in a tweet that, “Yes, one of the victories is blocking proposed taxes.”

Huobi HK is now offering crypto spot trading to retail and institutional clients in Hong Kong, having now applied for a virtual asset exchange license.

The exchange submitted an application notice to the Hong Kong Securities and Futures Commission on May 29, according to a statement on Twitter. Crypto firms need to apply for the license before they are able to start offering regulated services.

The platform will work with auditors and focus on compliance and anti-money laundering regulations, it added. This will be aimed at meeting the requirements of the Hong Kong Securities and Futures Commission.

Social platform Reddit is close to breaching 10 million holders of its collectible avatars, or “Reddit NFTs,” nearly 11 months after its launch in July 2022.

According to Dune Analytics, there are currently a total of 9,909,465 million Reddit collectible avatar holders. Around 7.7 million of these are identified as single collective avatar holders, or those that do not have multiple wallets.

Reddit launched a collectible avatar marketplace on the Ethereum scaling network Polygon in July 2022. NFTs in the customizable collection have been designed by independent artists and Reddit content creators.

Avatar holders surged following the collection’s launch but reached a plateau at around 3 million in November. However, there has been a big growth spurt in 2023, with the number of wallets tripling over the past six months.