While the full effects of the pandemic yet to be seen, it is already clear that 2022 continues to show signs of a year of immense upheaval. The global economy has been thrown into turmoil, and this is likely to continue into Q3 and beyond. In recent months, we have seen a huge amount of market volatility within both the equity and crypto-assets ecosystems. This is partly due to the pandemic, but also due to factors such as trade tensions and political turmoil. Looking ahead to summer 2022, it is likely that this volatility will continue. Many decisions made in the past will have consequences, and it is uncertain how these will play out. Uncertainty = more volatility!
The question of how to handle inflation has been a contentious one for economists and policymakers for decades. And it is an issue that has taken on new urgency recently as global inflation rates have begun to tick upwards. A case in point is the COVID-19 pandemic, which has resulted in numerous governments incentivizing their struggling economies through incentive packages. This has created what many referred to as a cycle of infinite money printing, resulting in sky-high inflation rates.
Although the numbers for April are not yet in, last month, the United States Bureau of Labor Statistics (BLS) reported that the Consumer Price Index reading hit 8.5%, breaking yet again another 40-year high. To battle the rising inflation, the Federal Reserve has begun increasing interest rates, with the latest hike amounting to 0.5%.
There are many who argue that the Fed’s rate hikes are misguided and will only serve to stifle economic growth. Others say that they are necessary to prevent inflation from spiraling out of control. Only time will tell who is right. But one thing is certain: the issue of inflation is one that is not going away any time soon.
This year is likely to be one of considerable market turbulence, it is more important than ever for investors to be mindful of the risks involved in taking on new positions as well as holding onto existing ones. With that said, there are still opportunities to be had – but they will require a level-headed and cautious approach. Those who can navigate these choppy waters successfully will come out on top.
The cryptocurrency market took a beating over the last few days, with Bitcoin (BTC) losing over 16% of its value within the span of four days. This sell-off led to a whipping of $300 billion for the entire crypto market capitalization. BTC has closed six consecutive weeks with a loss, which hasn’t happened in eight years.
While the volatility of BTC should not be a surprise to many crypto holders, a contributing factor may be that we are seeing a natural correction after BTC’s meteoric run-up in price over last year. However, some analysts believe that this is just a temporary dip and that BTC will continue to rise in price in the long run. Only time will tell what the future holds for the cryptocurrency market
Now that we have an overview of the market condition, let’s look at some news that could be a contributing factor to the volatility we see in the crypto market.
Here is What Investors Should Know
Apartment Sold for Bitcoin in Portugal After New Regulation Allows Property Deals in Crypto.
The sale of an apartment in Portugal for cryptocurrency marks a first for the country and highlights the growing role cryptocurrencies are playing in the global economy. The home was purchased for 3 bitcoins without conversion to euros, under a new regulation permitting real estate deals with digital currencies. This sale is just one example of how cryptocurrencies are being used as an alternative to traditional fiat currencies, especially in countries where sanctions or other restrictions make it difficult to access traditional banking systems.
Crypto has become especially attractive for the island nation due to US sanctions limiting its ability to conduct international trade.
Many Cubans are now using cryptocurrencies to circumvent US sanctions, which have limited the country’s access to traditional payment rails.
2022 FOMC Meeting Calendar
Cryptocurrency’s role in bypassing sanctions has been examined thoroughly by governments ever since the US sanctioned Russia in February. Though small Cuban coffee shops may be able to work around these restrictions using crypto, Chainalysis claims that this isn’t viable for alternative national governments. Cryptocurrencies offer a way to transact without going through traditional financial institutions, which are subject to government regulations. For countries under sanctions, this could provide a way to continue trading with the outside world. However, cryptocurrency transactions are not anonymous, and they can be traced. This makes it difficult for countries to use cryptocurrencies to avoid sanctions. In addition, cryptocurrencies are not widely accepted, and their value is volatile. For these reasons, it is unlikely that cryptocurrencies will be able to replace traditional means of transactions for sanctioned countries.
As more people become familiar with cryptocurrencies and their potential uses, it is likely that we will see even more innovation in this space.
Regulatory Presence in Metaverse
As digital life becomes increasingly important, regulators are facing pressure to keep up with the times and provide resources that are accessible in virtual environments. Dubai’s cryptocurrency regulator, VARA, has become the first such national watchdog to take this step by acquiring land in the metaverse with plans to establish a virtual headquarters. VARA’s “MetaHQ” will be created using The Sandbox metaverse platform and will provide digital users access to regulatory resources within the virtual environment. This is an important development that will help ensure that people can access the information and resources they need in a format that is convenient for them.
Regulators in the States
It’s been a little while since we’ve talked about the various regulators in the states and their roles when it comes to Bitcoin. As we all know, there are tons of different agencies that can weigh in on digital currency, and each one has its own opinion on how things should work. In this post, we’ll take a look at the more notable agencies and what they’ve been up to lately. So, without further ado, let’s get started!
The U.S. Securities and Exchange Commission is adding 20 more officials to a team dedicated to policing crypto markets, the latest move by Wall Street’s main regulator to crack down on digital tokens that may run afoul of its rules.
The additions will bring the SEC’s Crypto Assets and Cyber Unit to 50 people, the agency said Tuesday in a statement. The focus of the expanded enforcement group will include virtual-currency offerings, decentralized finance and trading platforms, as well as stablecoins, according to the regulator.
SEC Chairman Gary Gensler told Congress last week that he believes cryptocurrencies like Bitcoin are securities, a pronouncement that could have sweeping implications for the industry. His comments came as lawmakers consider whether to pass new regulations governing digital assets.
The SEC has already brought a number of enforcement actions against firms involved in the sale of digital tokens, alleging that some offerings were illegal securities sales. The agency has also been scrutinizing cryptocurrency exchanges and wallets for potential violations of anti-money-laundering rules.
The expanded team will help the SEC keep pace with the growing cryptocurrency market, which has seen a surge in activity in recent months.
NVIDIA LAWSUIT SETTLEMENT
Last week, the Securities and Exchange Commission (SEC) announced that it had reached a settlement with NVIDIA Corporation (NVIDIA) concerning the company’s disclosures related to crypto mining. According to the SEC’s press release, NVIDIA failed to fully disclose information concerning crypto mining as a significant source of revenue for its gaming business.
Since the demand and interest in crypto rose in 2017, the company has been a major player in providing advanced GPUs to mining facilities. The release states that NVIDIA included its revenue from GPU sales to crypto miners as part of its gaming business, but the company did not reveal that its “increase in gaming sales was driven in significant part by crypto mining” in its Forms 10- Q, as required by SEC. As a result of the settlement, NVIDIA will pay a $5.5 million penalty and has agreed to revise its disclosures going forward.
As from NVIDA’s involvement in the crypto mining industry, the company has also expressed interest in the metaverse. Earlier this year, NVIDIA announced a program to support artists and content creators who are building virtual worlds and products for the metaverse. This moves signals NVIDIA’s belief that the metaverse will become a major platform for gaming, entertainment, and other applications in the future. NVIDIA’s experience in creating high-performance GPUs makes it uniquely positioned to support the development of the metaverse. With its powerful hardware and software tools, NVIDIA is well-suited to help developers create immersive virtual worlds that can be enjoyed by millions of people around the world.
What is BTC Cash?
Bitcoin Cash is a fork of Bitcoin that was created in 2017 because of disagreements over how to scale the network. At the time, Bitcoin transaction fees were high because of an increase in usage on the network. SegWit a mechanism to reduce the size of transactions was proposed by members of the Bitcoin Core development team as a solution. However, some actors in the ecosystem voted for an increase in block size. Members of the Core team argued that this would centralize mining, while others claimed that adding extra protocols went against Satoshi’s original vision for Bitcoin.
Why does BTC cash have value?
Bitcoin Cash is a clone of Bitcoin with a few adjudgments. It has the same fundamental codebase and security but with increased block size. The increased block size maintains the transaction fees below the 1-cent mark, which makes it ideal for micropayments. For this reason, it has been used to make tipping bots on social networks. It is now used as a peer-to-peer payment system which was what Satoshi had originally envisioned Bitcoin would be… among other things.
The supply of Bitcoin Cash is capped at 21 million coins. Every ten minutes, a new block is created through mining and the miner who solves a certain puzzle receives 6.25 BCH as a reward. Anyone can mine BCH as long as they have enough computational power to solve the puzzles on each block.
Who founded BTC Cash?
Amaury Séchet, the developer of the Bitcoin ABC client, introduced the first implementation of Bitcoin Cash.
What Ecosystem does BCH run on?
Where can I buy BCH?
BitBit Financial is one of the first Canadian regulated crypto marketplaces and licensed with FINTRAC as MSB. As an industry leader in digital assets, trading, and lending, BitBit Financial brings you a secure and discreet way to purchase BCH.
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