Is Fed’s Interest Rate Hike the Biggest Impediment to Bitcoin’s Bullish Outlook?

With speculations high that the Federal Reserve (Fed) will increase the interest rate by 75 basis points (bps) on June 15 to tame inflation, this might dent Bitcoin’s bullish outlook as the leading cryptocurrency continues to trade at an 18-month low. 

Market analyst under the pseudonym ZeroHedge noted:

“Odds of 75bps rate hike Wednesday hit 95%.”

Other analysts also believe that the stakes are high for the interest rate to be increased by 75bps or 0.75%.

For instance, Michael Feroli, an economist at JPMorgan, commented that long-term inflation expectations might cause the Fed to raise the rate by 75bps. 

Goldman Sachs analysts shared similar sentiments and stated:

“Our Fed forecast is being revised to include 75 bps hikes in June and July.”

They added:

“We anticipate two more rate increases in 2023 to 3.75-4%, followed by one cut in 2024 to 3.5-3.75%. We anticipate a 50bp increase in September, followed by 25bp increases in November and December, for an unchanged terminal rate of 3.25-3.5%. We expect the median dot to show 3.25-3.5% at end-2022.”

How is an interest rate hike bearish?

Previously, analyses have shown that an interest rate increase usually has an inverse relationship with Bitcoin because the price usually falls. 

For instance, after the Fed raised the interest rate by 50bps or 0.5% last month, a bullish picture was initially painted, but this was short-lived because Bitcoin sank to a two-month low, Blockchain.News reported. 

Arthur Hayes, a trading and crypto enthusiast, pointed out:

“The bull market can only begin once the Fed and its sycophantic cadre of other central bankers reverse course, which at the very least requires pausing rate hikes and keeping the size of their balance sheets constant.”

Mike McGlone, the senior commodity strategist at Bloomberg Intelligence, had previously noted that the Fed’s continued interest rate hike was the primary stumbling block to BTC’s price surge. 

With Bitcoin experiencing massive liquidation to the tune of $1.05 billion in the last 24 hours, the top cryptocurrency finds itself between a rock and a hard place if the speculated Fed interest rate increase materializes. 

BTC was hovering around the $22,652 level during intraday trading, according to CoinMarketCap

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Bitcoin Enters the Deepest Phase of the Current Bear Cycle as Price Slips to an 18-Month Low

After briefly slipping to the $21K zone, Bitcoin (BTC) continues to trade at levels last seen in December 2020.

The leading cryptocurrency was down by 9.94% in the last 24 hours to hit $22,668 during intraday trading, according to CoinMarketCap

Glassnode believes BTC is entering the deepest part of the present bear cycle, given that even long-term holders are experiencing losses. The market insight provider explained:

“With Bitcoin prices selling off to the mid-$20ks, a plethora of macro indicators suggest the market is entering the deepest phase of this bear cycle. Fundamentals have deteriorated, and even Long-term Holders are now realizing significant losses.”

Is Bitcoin at rock bottom?

The top cryptocurrency is also hovering around the 200-week moving average, which is indicative of a market bottom, according to crypto analyst Lark Davis. He noted:

“The 200 week moving average for Bitcoin has marked previous bear market bottoms.”


Source: TradingView/LarkDavis

This indicator reflects a long-term measure that shows four years of an asset’s price action. 

Therefore, it remains to be observed whether Bitcoin will bottom out and change course because the 200-week moving average zone has previously acted as a reversal point.

On-chain insight provider Coinglass stated:

“In each of its major market cycles, Bitcoin’s price historically bottoms out around the 200 week moving average.”

Other analysts have also joined the discussion and opined that Bitcoin might be edging closer to the market bottom.

For instance, market analyst Ali Martinez said:

“Bitcoin has officially gone from Greed to Denial, from Denial to Anxiety, and from Anxiety to Fear. BTC has now entered Capitulation, which usually tends to kickstart a new market cycle based on the NUPL indicator. This means that the BTC market bottom is closer than ever.”


Source: CryptoQuant

Similar sentiments were echoed by crypto trader Rekt Capital, who noted:

“BTC is approaching RSI levels last seen at the 2015 & 2018 Bear market bottoms.”


Source: TradingView/RektCapital

Bradley Duke, the Co-CEO at crypto ETP-provider ETC Group, noted that the recent LUNA collapse sent shockwaves in the entire ecosystem and this is what is partly causing the market to bleed, Blockchain.News reported. 

With the crypto markets being in extreme fear mode, time will tell how things shape up moving forward.

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PANGU Announces ‘PANGU ECOLAND’ NFT drop from June 14

Hong Kong-based and the Metaverse-driven startup agency PANGU by Kenal (PANGU) announced that it will be launching the ‘PANGU ECOLAND’ NFT drop from today at 11 pm local time. - 2022-06-14T154538.099.jpg

The announcement added that non-fungible token (NFT) lovers can view 30 assets from the PANGU ECOLAND experience, which will be exclusively available on The Sandbox – which has appointed PANGU as the company’s metaverse agency.

PANGU ECOLAND is an eco-energy rescue adventure where players have to restore a metaverse and its voxel world.

PANGU ECOLAND will be the first sustainable LAND in The Sandbox metaverse as the company taps into its stated belief in environmental sustainability and its environmental awareness.

Among various NFT products with various classes based on the rarity, the Sandbox said in a blog that the NFTs will grant owners special rewards while playing the game. In its “ask me anything” (AMA ) online section, the company said customers can enjoy buying 1 get 1 free for NFT products. In addition, the agency would donate to planting a tree for every single product to meet the environmental friendly objective.

According to the announcement, PANGU will announce more NFTs and further expansion of the PANGU ECOLAND experience for NFT collectors in the coming future.

The metaverse development solutions provider also provides metaverse-centric strategic planning, business development and marketing solutions, NFTs and trading, gaming and social experience creation.

The Kenal Group is a comprehensive creative agency that has been providing all-rounded marketing solutions since 2008.

Image source: PANGU by Kenal


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Following Market Crash, BoE Governor Says Crypto Has No Intrinsic Value

While traditional financial institutions gradually embrace Bitcoin, a longtime crypto sceptic, Bank of England Governor Andrew Bailey, has once again reasserted his stance recently, stating that the asset class has “no intrinsic value.”

The governor of the British Central Bank testified in the U.K. Parliament on Monday, the day after lending platform Celsius paused transfers and withdrawals, a move that triggered a market crash on Bitcoin and other cryptocurrencies.

“Crypto-assets have no intrinsic value. This morning we have seen another blow-up in a crypto exchange,” Bailey stated.

Bailey’s comments came after major crypto lending platform Celsius Network decided to halt transfers and withdrawals on Monday, citing extreme market conditions. Celsius, which offers global services to customers worldwide, is headquartered in London, United Kingdom.

The UK-based cryptocurrency lending and borrowing firm stated that the action being taken currently aims to put Celsius in a “better position” to honour withdrawal obligations. However, market participants are concerned with Celsius’ ability to meet its long-term debts and financial obligations.

This is not the first time that Bailey made such sentiments. The U.K. Central Bank governor has never been a fan of cryptocurrency. Last month, the governor said that Bitcoin has no intrinsic value and cryptocurrencies are not suitable as a practical means of payment. His warning came after the crypto market plunged last month, a crash that shed almost $500 billion that month. The market, which fell on May 12, sent Bitcoin price below $26,000 for the first time in 16 months. That marked the first time the crypto sunk below $26,000 since December 26 2020.

The Celsius move further triggered a plunge across cryptocurrencies, with total crypto value falling below $1 trillion for the first time since January 2021 and Bitcoin tumbling below $23,000 per coin.

Central Banks Researching CBDCs

While Bailey admits that blockchain, the underlying technology of cryptocurrencies, is important, he is convinced that Bitcoin is unsuitable as a means of payment. Last month, the governor said that Britain’s Central Bank is researching a launch of its own digital currency.

Most central banks have remained sceptical about cryptos and are taking a cautious approach. They embark on launching their own cryptocurrency, backed by foreign guarantees, rather than trusting some private digital coins.

Many central banks around the globe have been researching the practicalities of creating their own digital currencies. So far, about 10 central banks, including the Bahamas, Nigeria, Cambodia, China, and island nations (Antigua and Barbuda, Grenada, Saint Kitts and Nevis, Saint Lucia, Dominica, and Montserrat) have created their own central bank digital currency. Other 100 nations are actively evaluating central bank digital currencies (CBDCs).

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Crypto.Com, BlockFi Announce Massive Layoffs as Economic Crisis Bites

Crypto exchange and lending platform BlockFi announced on Monday plans to cut over 400 jobs globally, as they come under pressure from difficult market conditions. said that it would reduce its workforce by 5%, that is about 260 employees. CEO Kris Marszalek disclosed the announcement via Twitter social media: “Our approach is to stay focused on executing against our roadmap and optimizing for profitability as we do so … That means making difficult and necessary decisions to ensure continued and sustainable growth for the long term by making targeted reductions of approximately 260, or 5%, of our corporate workforce.”

Meanwhile, BlockFi also announced on Monday that it is laying off 20% of its workforce, which is around 170 people. Zac Prince, BlockFi CEO, said in a tweet Monday that the crypto lending firm is reducing its “headcount by roughly 20% and the reduction impacts every team at the company. This decision was driven by market conditions that have had a negative impact on our growth rate and a rigorous review of our strategic priorities.”

Recession Fears and BlockFi have followed a series of various crypto firms faced with massive layoffs. Late last month, Bitso, one of the biggest crypto exchanges in Latin America, laid off 80 employees due to the recent downturn in the crypto market. Last month, Buenbit, an Argentina-based cryptocurrency exchange, also cut its workforce by 45%.

Earlier this month, Coinbase announced a freeze of its hiring for the foreseeable future and withdrew a number of accepted offers in order to deal with current macroeconomic conditions. Early this month, Bahrain-based crypto exchange Rain Financial Inc and Latin America’s largest crypto exchange 2TM also laid off over a dozen employees as digital asset markets remain red.

Crypto market is experiencing bad days as value of the digital assets plunged below $1 trillion on Monday, triggered by the announcement by Crypto lender Celsius Network that it paused all withdrawals and transfers between accounts, citing “extreme market conditions.”

The latest crypto crash marked the first time since January 2021 when the Bitcoin price fell to a low of $23,750 and the cryptocurrency market has reached as low as $926 billion, according to data site CoinMarketCap. In November 2021, the global crypto market peaked at $2.9 trillion but has been seeing a steady decline this year.

In the past two months, investors have dumped riskier assets amid high inflation and fears that interest rate raises by central banks will hamper growth. Extreme market conditions and central banks’ policy updates are exacerbating the consequences for digital assets.

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Crypto Bank Silvergate Capital Receives Bullish Rating from Wells Fargo

Silvergate Capital, a crypto state-chartered bank based in California, has received a bullish rating from Wells Fargo, which initiated coverage on the digital asset company with an overweight rating based on rising interest rates and prospects for further growth in its exchange network.

In a note, Jared Shaw, a Wells Fargo analyst, stated that Silvergate provides an opportunity for investors. The report further mentioned that the ongoing institutional adoption of cryptos and product innovation should help maintain Silvergate Capital’s (SI) growth profile.

Shaw wrote in a note that the current bear market makes an attractive entry point for institutions investing in cryptocurrencies. “As rates rise, higher spread income will come from a zero-cost deposit base, and further growth in SEN Leverage and the rollout of an SI-issued stablecoin payments network represent future opportunities,” the report stated.

Wells Fargo mentioned that the market is in the early stages of cryptocurrency and blockchain adoption. The note said that Silvergate offers a regulated and FDIC-insured platform for investors looking to on-ramp and off-ramp U.S dollars into the digital asset ecosystem.

The analyst pointed to Silvergate’s (SI) as the “biggest driver of deposits” and digital customer growth, as its client base has been growing at a 35%-40% rate year on year since 2019. The note further pointed out that Silvergate has developed a strong network impact via its Silvergate Network (SEN), which is used by some of the leading exchanges and institutions in the digital asset space. The report also stated that Silvergate plans to launch its own U.S.-based stablecoin payments platform late this year, unleashing new potential revenue opportunities.

The note stated that it “should drive much of the bank’s near-term profitability, as 77% of assets are securities (55% floating) and the loan book is also heavily floating-rate,” the note stated.

Wells Fargo’s view contrasts with its peers like Morgan Stanley, which gave Silvergate an equal weight rating last week.

Bitcoin Crashes Again

Wells Fargo’s ‘BUY’ rating for Silvergate comes despite the renewed crypto crash triggered by crypto lending platform Celsius’ pause on all withdrawals, swaps, and transfers between accounts due to “extreme market conditions.” Shares of Silvergate dropped more than 17%, and other crypto-focused stocks such as MicroStrategy and Coinbase collapsed during premarket trading on Monday as Bitcoin price plunged below $24,000 per coin.

Three weeks ago, the crypto market saw another worse selloff, exacerbated by rising interest rates and TerraUSD losing its peg to $1 and eventually leading to the collapse of both the stablecoin and Terra (LUNA).

Volatility continues to be the norm in crypto coins, and the latest fall witnessed on Monday is another reminder of that. But what is being done by payment systems and digital projects will continue to stabilize the market long term.

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BTSE Becomes 1st Exchange to Offer Perpetual Futures Trading for Overcollateralized Stablecoin

Crypto exchange BTSE has become the first crypto exchange to offer perpetual futures trading for the world’s newest stablecoin, US Decentralized (USDD). - 2022-06-14T123832.093.jpg

According to a press release, BTSE’s offerings in its Futures feature, including perpetual futures for USDD, may appeal more to experienced traders. 

However, for less advanced users, BTSE provides a collection of resources and learning materials — the BTSE Testnet, tutorials, and a support centre — to introduce the mechanics behind futures. The materials can help users understand the risks and rewards involved in BTSE’s future products and provide traders with a way to backtest strategies or formulate plans to profit from market volatility.

“By including USDD perpetual into our (BTSE) futures offerings, while providing a repository of educational content to demonstrate how futures trading and other types of investments can be part of a balanced portfolio, we are adding ways for long-term crypto investors to create new trading strategies that meet their own needs,” said Henry Liu, Chief Executive Officer of BTSE.

Perpetual futures can introduce hedging and risk management into a portfolio, improving its resilience during high volatility in market conditions.

They also provide short exposure by allowing traders to bet against an asset’s performance, enabling the possibility to reap profits during a downturn.

According to CoinGecko, BTSE has been a consistent leader in derivatives trading. BTSE claims that it generates more than US$1.5 billion in daily transaction volume on BTC and ETH futures on the exchange.

Furthermore, BTSE’s low trading fees give users the flexibility to settle futures with their choice of supported crypto or fiat currencies, such as BTC, USDT, or US dollars.

USDD is an algorithmic stablecoin on the TRON, BNB Chain, and Ethereum networks, which entered circulation on May 5, 2022, which is the first overcollateralized decentralized and youngest stablecoin in existence, pegged at roughly 1:1 to the US dollar.

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Atmos Labs Pulls $11m in Seed Round to Bolster Metaverse Development

Atmos Labs Inc, a metaverse gaming protocol, has raised $11 million in seed funding, as it looks to double down on its metaverse development push. (68).jpg

Atmos is currently being fronted as a new play-and-earn metaverse, tasked with building an immersive experience that will pair an esports component with the fandom and sense of belonging that comes with conventional sports in a new virtual universe. The latest capital injection will enable the firm to achieve this landmark goal.

“People are going to congregate around the spectacle of competition in the metaverse just like they do in the physical world. We are building metaverse-native sports and entertainment — a category we believe will bring excitement and substance to the metaverse concept writ large,” said Atmos Labs’ Founder and CEO Kevin Beauregard.

As announced by the firm, the seed round was led by Sfermion and it saw participation from Animoca Brands, Collab+Currency, FBG Capital, Alumni Ventures, RedBeard Ventures, DWeb3, LD Capital, GSR Markets Limited, CoinGecko Ventures, Avocado Guild, UniX Gaming, and more.

The valuation of the startup remains unknown and the firm said it will use the new capital to build the foundation of the virtual game world of Atmos, grow its community, and expand the Atmos team.

The primary goal of Atmos is to debunk the myths surrounding metaverse-backed sports games. The startup is building the infrastructure that will help the global adoption of competitive sports in virtual environments.

The current terrain in the digital currency ecosystem is not one that encourages investments, but startups like Atmos have continued to bedazzle investors with their plans for the future of the metaverse. While the funding momentum is generally tapered down, venture capital funding has continued to flow to innovative protocols like Orderly Network and Utopia Labs as recently reported by Blockchain.News.

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Binance.US Sued for Selling Unregistered LUNA Securities

Binance.US has been sued in a class-action lawsuit for selling unregistered security tokens from the Terra blockchain protocol. (66).jpg

The class-action lawsuit was filed in the Northern District of California, dragging the exchange for misleading investors with the sale of LUNA and UST tokens, both of whose collapse led to the loss of over $40 billion of investor’s money globally.

The lawsuit, filed by the plaintiffs, represented by law firms Roche Freedman and Dontzin Nagy & Fleissig, blames Binance.US’s business model “premised on illegally enabling the sale of unregistered securities to as many US investors as possible, as often as possible.”

The Plaintiffs are asking for a Jury trial where it deems necessary as the exchange was also accused of promoting the airdrops of tokens in a bid to facilitate trading volume.

Since the collapse of UST and LUNA, several groups of investors, including those from South Korea, have been plotting lawsuits as they explore avenues to cut back on their losses, despite the emergence of Luna 2.0. 

In a bid to aid those seeking to explore legal options in pursuit of all parties they deemed guilty in the Terra mishap, Kyle Roche from Roche Freedman posted an update back in May, which seems to have materialized through the lawsuit.

“If you purchased $LUNA or $UST on either @coinbase @krakenfx @binance or @Gemini, please reach out to My firm is coordinating an effort to help those who lost funds from the recent collapse of #terra and #luna,” he said in a tweet on May 13.

A Binance.US spokesperson has denied all forms of wrongdoing, noting that the exchange operates within the provisions of existing laws. 

“Binance.US is registered by FinCEN and adheres to all applicable regulations. The spokesperson said that these assertions are without merit, and we will defend ourselves vigorously,” the spokesperson said.

While other exchanges, particularly Coinbase, have also been embroiled in a class-action lawsuit, this filing will be one of the most publicized for Binance.US.

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Goldman Sachs Launches First Ethereum-Linked Derivatives Product

American investment banking and financial institution giant, Goldman Sachs Group Inc has started trading a type of Ethereum-linked derivatives, as it seeks to expand its reach in the crypto markets beyond Bitcoin-focused products. (67).jpg

Bloomberg first reported the trade on Monday, noting that the product executed is an Ethereum non-deliverable forwards, a derivative that pays out based on the price of ether.

Billed to offer institutional investors indirect exposure to the cryptocurrency, Goldman Sachs has finally shown its readiness to put its money where its mouth is with regard to its embrace of digital currencies. 

The financial institution has been backing a lot of crypto startups, including but not limited to CertiK, a blockchain security outfit, a sign that it believes in the future of the technology, and the need to have the right partners to bolster its growth. 

According to the report, Marex Financials was named as the counterparty to Goldman Sachs for the new derivatives product. 

Goldman Sachs has exhibited a series of upheavals as it relates to the digital currency ecosystem. While it was amongst the first banks to offer trading desks for Bitcoin trading, it paused for a while and resumed these activities back in March last year as reported by Blockchain.News at the time.

While the move to add Ethereum-based derivatives products is a way to consolidate its Bitcoin trading position, the move has spelt more ambitions than was previously led on.

For what it is worth, the digital currency ecosystem is reeling in a massive price correction that has seen the industry’s biggest coins fall back to price levels not seen in about 18 months. 

That Goldman Sachs could float a new product with the industry’s bearish momentum is evidence that its claims that institutional demand in crypto is rising is true, and it aims to be at the forefront of this embrace.

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Bitcoin (BTC) $ 39,681.63 2.33%
Ethereum (ETH) $ 2,159.95 2.82%
Litecoin (LTC) $ 71.77 0.16%
Bitcoin Cash (BCH) $ 227.14 0.68%