The Monday Read – Weekly Crypto Insights, Issue Six

Fears that the Chinese lockdowns to fight Covid, which have extended for four weeks in Shanghai, are not working and may be broadened to Beijing have whacked equity markets, dampened the increase in bond yields, and lifted the dollar. 

Despite concerns about demand, commodity prices are broadly lower. Hong Kong’s Hang Seng fell more than 3.5% on Monday morning April 25th, 2022, while China’s CSI 300 fell more than 5%. Europe’s STOXX 600 is off around 1.9% after falling 1.4% last week. 

US futures traded relatively mixed on Friday, about 0.7%-0.8% lower. Last week, the S&P 500 dropped for the third consecutive week, marking the longest losing streak in more than 18 months. The 10-year yield dropped slightly, and the crypto markets lost $80BN as Bitcoin fell to 40-day lows over the weekend. 

Altcoins also saw significant volatility over a couple of days, with Ethereum slipping into the $2,800 region and Solana hovering around $100. 

The past few days have undoubtedly been difficult for the primary cryptocurrency. On April 21, the asset attempted to breach $43,000 but ultimately failed. The worst was yet to come, as price drops continued to worsen. BTC fell to $39,000 over the weekend before plummeting even lower to $38,000 this morning, marking the lowest. 

Despite this, the advent of cryptocurrencies as an alternative to traditional forms of payment has led governments around the world to begin taking steps to incorporate the assets into their operations and bring them under their control. 

Here's what investors should take from the most recent cryptocurrency regulation news

The Central African Republic might follow El Salvador's example and embrace Bitcoin as legal tender.

The Central African Republic’s government claims to have passed a bill that makes bitcoin a legal payment option within its national borders. If successful, the plan will make the country the first in Africa and second globally after El Salvador to implement it. 

For years, the economy of Central America has struggled, and bitcoin might be regarded as one of the country’s last hopes. Following El Salvador’s adoption of BTC, the number of visiting tourists increased significantly, and a large number of investments. It would be reasonable to assume that CAR will see comparable beneficial results. 

Moreover, the new crypto law would reportedly allow citizens to pay their taxes with crypto and enable businesses to accept crypto as payment. 

UAE Issues Crypto License to Kraken

Kraken has become the first crypto exchange to be granted a license to operate a regulated digital assets platform in Abu Dhabi. The Middle East is becoming a focus of expansion for the industry, thanks to the UAE’s recent crypto licensing policy. Several major platforms, including Binance and FTX, have also obtained digital asset licenses from Emirati authorities, with plans to open regional offices. 

Following India’s current tax regime, WaziriX, the country’s major digital currency exchange, may relocate to Dubai. On April 1st, authorities imposed a 30% tax on cryptocurrency trades. 

National Payments Corporation of India (NPCI) has been asked to issue a formal directive explaining the limitations on money transfers using the Unified Payments Interface (UPI) for trading digital assets

NPCI instructed Indian banks to block UPI payments for cryptocurrency purchases, according to a report by the Economic Times of India. 

Banks are also seeking clarification on the immediate payment service (IMPS), another payment method developed by NPCI, and whether it is allowed for cryptocurrency-related trades. 

Crypto Businesses Ask 27 EU Finance Ministers to Loosen Disclosure requirements

In a letter to the finance ministers of 27 European countries, 46 European crypto firms and organizations have called on them to loosen some regulatory strictures in the sector. For example, they requested that decentralized finance (defi) initiatives be exempt from the requirement to become legal entities. 

The businesses and organizations that signed the letter, which was sent on April 13, urged EU lawmakers to guarantee that their rules do not go beyond current measures that are in keeping with Financial Action Task Force standards (FATF). 

Meanwhile, the Bank of England is attempting to raise £24m so it can hire 100 extra staff and monitor new risks, including those relating to cryptocurrency assets, as reported last Wednesday by The Guardian news. 

There are several significant events taking place in North America.

Tennessee is now searching for a service provider to store cryptocurrencies on its behalf. On April 21, the Tennessee Department of Treasury published an RFP (Request for Proposals) seeking information on how the custodian would safeguard the state’s bitcoin assets, such as Bitcoin (BTC), reported by The Nashville Post. 

In Canada, Timothy Lane, Deputy Governor of the Bank of Canada, will participate in a panel discussion at the Financial Times Live’s Crypto and Digital Assets Summit on April 26, 2022. 

NFT & GameFi sector

Axie Infinity was hyped as one of the most promising blockchain applications last year. 

Things took a turn for the worse this year when Sky Mavis’ Ronin blockchain was hacked and lost approximately $600 million in value. 

Following a tip from the FBI last week, the U.S. Treasury added the attacker’s Ethereum wallet to its sanctions list. The FBI has claimed that the North Korean Lazarus group of hackers was behind the security breach. 

On April 22, Binance CEO Changpeng Zhao announced that the exchange has recovered $5.8 million in stolen funds. The North Korean hacking group behind the heist began to move some of the loot onto “over 86 accounts,” according to Zhao, and that $5.8 million had been recovered. 

Nissan and Toyota Enter The Metaverse — With Two Different Approaches

Major corporations and organizations are now tinkering with the Metaverse at an increasing rate. 

This time, it has caught the attention of two of the world’s largest automakers: Nissan and Toyota. 

On April 22, Japanese automakers Nissan and Toyota announced their entry into the Metaverse to provide new virtual experiences to their customers, organizing digital events, and establishing virtual 

Nissan plans to concentrate on providing virtual reality rooms for its clients. Toyota, on the other 

hand, will focus on remote working environments and building facilities for employees where they may discuss technological breakthroughs via their avatars. 

Nissan and Toyota are not the first automobile manufacturers or firms to join the movement. In early April, Volkswagen and Mercedes-Benz launched campaigns to promote their Metaverse entries. 


What is Chainlink?

To run correctly, decentralized applications (DApps), especially decentralized finance (DeFi) protocols, frequently need real-time data from a provider. However, this information is often obtained from central authorities or unreliable sources. Chainlink provides an oracle network where DApps can get verified data that has been verified by node operators who are compensated for this work 

The ecosystem is made up of three main actors: data suppliers, node operators, and DApps. Data suppliers provide their information to node operators, who verify it and, if validating is successful, send it to the DApps. 

Link's Value

Chainlink has been popular in recent years, owing to its unique approach. While decentralized apps are inherently autonomous, the data they obtain may still be skewed, which would harm their functioning. Providers are encouraged to provide correct data and validators are rewarded for detecting false data by decentralizing the validation of facts. 

Chainlink as an oracle verifies data for most of the most prominent players in crypto, including CoinGecko, Binance, Aave, Compound, and more. 

Link's Tokenomics

The maximum supply of LINK tokens is capped at 1 billion, 35% of the tokens will be distributed to node operators and with the 35% sold during ICO and other public sales. The founding company retains 30 percent as development funding. To validate transactions, node operators must stake LINK; they will be compensated in LINK depending on the usage of their node. 

As digital assets continue to grow in popularity, BitBit Financial is here to help you make the most of your investment. LINK can be purchased through our OTC desk, and we also offer staking solutions. 

With our assistance, you can easily grow your digital asset portfolio and enjoy all the benefits that come with it. 

Contact us at info@bitbitfinancial.com for more information. 

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