Metrics

Total Market Cap: $388 billion (-16% w/w)
MC 7-Day High-Low Range: $190 billion (+15% w/w)
Bitcoin Dominance: 35.6% (+1.7 w/w)

The crypto Great Recession of 2018 hit this past week. No coin was spared as total market cap nearly halved to a $275 billion low on Monday. Coincidentally, the equity markets also had a sharp 4-5% pullback on the same day. No clear trigger for the selloff other than government regulation (as usual) at the top of everyone’s mind. This week we’ll begin with the behemoth USA.

USA SEC and CFTC Statements

On Tuesday, the SEC and CFTC chairmen appeared before the Senate Bank Committee for a hearing on “Virtual Currencies”. The overall market sentiment is cautiously optimistic (just kidding)… people are mostly happy with the result as no hard regulatory actions were mentioned, and the chairmen, in particular CFTC chairman Giancarlo, were clear in lauding the potential upside of blockchain: ““Do no harm” was unquestionably the right approach to development of the Internet. Similarly, I believe that “do no harm” is the right overarching approach for distributed ledger technology.” Redditors rewarded Giancarlo with 16x the Twitter followers.

A couple of salient notes:

  • All ICOs are considered securities offerings and should be regulated as such, even if the token represents as a “utility” token. This is by and large the same as it has been; most ICOs exclude US citizens to avoid the wrath of the SEC
  • Crypto ETFs are still discouraged as they are targeted at “retail” investors and are primarily for long exposure (as opposed to futures which can more easily provide both long and short exposure)

Links to SEC chairman Clayton’s testimony and Giancarlo’s testimony.

China Ban Continues

Back in September 2017 when China announced a blanket ban on all ICOs and crypto exchanges, residents fled (virtually) to offshore trading platforms. Binance physically moved their servers to Tokyo. This week the govt extended its reach to block all access to offshore ICOs and trading as well — meaning normal non-VPN access to offshore exchanges, as well as some onshore OTC services. Overall the market seems to be taking this news in stride as another blip in the current apocalyptic-like environment. Anecdotally VPN usage is still strong and the internet always finds a way.

SCMP overview of China’s crypto regulatory timeline.
http://www.scmp.com/business/banking-finance/article/2132009/china-stamp-out-cryptocurrency-trading-completely-ban

India Clarification

India’s Finance Minister clarified that there is indeed no ban on cryptocurrencies, but the govt does not recognize them as “legal tender or coin” and will “take all measures to eliminate use of these crypto-assets in financing illegitimate activities or as part of the payment system”. The last bolded statement is the important one as an impending prevention of crypto as payment for anything would certainly look and feel like a ban.

Meanwhile In Canada…

Canada approves its first blockchain ETF: Blockchain Technologies ETF ($HBLK) by Harvest Portfolios. Important to note that these ETFs do not actually hold cryptocurrencies, but instead are exposed to publicly traded companies that are associated with blockchain technologies. The US already has two ETFs, $BLOK and $BLCN, which contain stocks like Nvidia $NVDA, Square $SQ, and Micron $MU.

See you guys next week —


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Last week: Crypto Weekly Roundup 2/1/18
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