Fed hikes interest rates, bitcoin falls below $36,000 and central bank of Argentina says no to financial institutions offering crypto: Hodler’s Digest, May 1-7 May
Come every Saturday Hodler’s Digest will help you keep track of every single important news that happened this week. Best (and worst) rates, launch and regulation highlights, leading coins, predictions and more – a week on Cointelegraph in one link.
Top stories of this week
The Fed is raising interest rates by 50 basis points to fight inflation
On Wednesday, the United States Federal Open Market Committee (FOMC) voted to raise interest rates by 0.5%, marking the largest upward correction in over two decades. It was the second rate hike in 2022, with a total of seven hikes expected for the year.
In a press conference after the FOMC meeting, Federal Reserve Chair Jerome Powell further stressed the need to keep raising interest rates to fight inflation.
Coinbase raised the first Bitcoin-backed loan from Goldman Sachs
Coinbase has taken an important step in bridging the mainstream world and the crypto world with Bitcoin as collateral for a loan at Goldman Sachs. The actual mechanics of the deal was for Coinbase to borrow from Goldman, backed by some of the exchange’s BTC holdings. However, no amounts were mentioned.
“Coinbase’s collaboration with Goldman is a first step in recognizing crypto as collateral, deepening the bridge between the fiat and crypto economies,” Brett Tejpaul, head of Coinbase Institutional, told Bloomberg.
Binance pledges $500 million to invest in Twitter alongside Elon Musk
In April 2022, Tesla CEO Elon Musk revealed his intention to buy Twitter for $44 billion, subject to certain approvals. That $44 billion doesn’t just come from Musk’s pocket, but includes contributions from 19 other players. Crypto heavyweights Binance and Sequoia Capital Fund are among the donors with $500 million and $800 million, respectively.
Court Orders BitMEX Founder to Pay $30M Civil Penalty
A Thursday court ruling resulted in BitMEX co-founders Benjamin Delo, Arthur Hayes and Samuel Reed being ordered to pay a total of $30 million in civil penalties ($10 million each) for legal violations related to their operation of the BitMEX exchange.
The alleged offenses included failure to meet certain customer data requirements, failure to obtain proper regulatory approvals, and more. The $30 million ordeal follows other previous legal troubles.
The SEC is doubling down on crypto regulation by expanding the entity
The US Securities and Exchange Commission (SEC) is planning to strengthen its Crypto Assets and Cyber Unit – an SEC division responsible for overseeing the crypto industry. There are plans to expand the unit by 20 people, bringing the total team to 50 members.
The additional staff will almost double the current size of the unit. Gary Gensler, chairman of the SEC, spoke positively about the plans, while Hester Peirce, one of the SEC’s commissioners, questioned the move.
Winner and Loser
At the end of the week, Bitcoin (Bitcoin) is at $35,983ether (ETH) at the $2,689 and XRP at the $0.59. The total market capitalization is at $1.65 Trillion, according to to CoinMarketCap.
Among the top 100 cryptocurrencies, the top three altcoin gainers of the week are TRON (TRX) at 27.92%, anchor log (ANC) at 17.18% and Algorand (ALGO) at 10.21%.
The top three altcoin losers of the week are ApeCoin (MONKEY) at -39.48%, STEP (MEAN GREENWICH TIME) at -34.06% and kava (kava) at -27.18%.
For more information on crypto prices, see Cointelegraph’s Market Analysis.
Most Memorable Quotes
“I think of bitcoin the same way I thought of the early internet. [The government] I didn’t see it coming and now it’s a viable form of currency – you can actually buy things with it.”
Joe Roganpodcaster
“If you just did an overlay of the Nasdaq and the cryptocurrency markets, they are incredibly correlated right now, so I think this is causing a lot of churn and pain in the markets. Meanwhile, billions of dollars are pouring into Web3.”
Anthony ScaramucciFounder and Managing Partner of SkyBridge Capital
“If you told me you owned all the bitcoins in the world and you offered them to me for $25 I wouldn’t take them because what would I do with them?”
Warren BuffettCEO of Berkshire Hathaway
“Why is a painting worth $10 million? It’s oil on canvas. So value is in the eye of the beholder.”
Ken GriffinsFounder and CEO of Citadel Securities
“Why do you put so much effort into developing one […] Stablecoin payments system when the Fed just wants to dump you?”
Randal Quarlesformer Vice Chairman of the US Federal Reserve
“The NFT market is collapsing.”
Paul VignaReporter for the Wall Street Journal
forecast of the week
Bitcoin falls to $35.5k as 1,000-point Dow correction marks worst trading day since 2020
Bitcoin has suffered some downside price action over the past week. On Thursday, BTC price fell below $36,000 in a selloff that affected both crypto and legacy financial markets.
Some technical strategists consider the $37,500 level to be the crucial line in the sand in terms of bullish and bearish narratives. Bitcoin’s decline below this threshold suggests that its near-term prospects are bearish.
FUD of the week
Warning: Smartphone text prediction guesses crypto hodler seed phrase
Reddit user Andre, aka u/Divinux, recently posted a warning on the social media site explaining that a cell phone’s prediction text could potentially guess the owner’s crypto seed phrase if the phrase was entered on the device. Andre tested his results with multiple device brands and found similar results. This could potentially expose the cellphone owner to crypto theft.
So far in 2022, more than $1.6 billion has been exploited by DeFi
Crypto-related theft through hacks and other malicious activities in 2022 has already eclipsed the previous two years combined, according to data from blockchain security firm CertiK. In total, around $1.6 billion in crypto assets have been appropriated so far in 2022.
Other than that, context is everything. The decentralized finance market has appreciated sharply over the past two years and currently sits at around $200 billion in total locked value, according to DeFi Llama.
Argentina’s central bank steps in to block new crypto offerings from banks
In Argentina, according to a decision by the Central Bank of Argentina (BCRA), financial institutions are banned from offering crypto trading to clients. The central bank cited known concerns about crypto, including the lack of proper regulation of the asset class, to justify its decision.
Earlier in the week before BCRA’s filing, two well-known Argentinian banks revealed plans to offer certain crypto assets for purchase by customers.
Best Cointelegraph Features
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From organic seafood to bored apes, blockchain technology is making its presence felt in homes.
The creator economy will explode in the metaverse, but not under the Big Tech regime
Independent creators and artists should feel empowered by the decentralization and not play by the rules of Big Tech, especially in the Metaverse.
https://cointelegraph.com/magazine/2022/05/07/us-fed-hikes-rates-bitcoin-plunges-below-36k-argentina-central-bank-says-no-financial-institutions-offering-crypto-may-1-7 Fed hikes interest rates, bitcoin falls below $36,000 and central bank of Argentina says no to financial institutions offering crypto: Hodler’s Digest, May 1-7 May