Here’s What Shaping Crypto Market Today – Key Updates and Trends

The crypto market has declined by 0.54% in the past 24 hours, continuing a downward trend with a 4% loss over the week. This decline is explained by a risk-off market move, caused by leveraged long liquidations and divided signals of regulators.

A massive liquidation of up to 1.8 billion caused a massive sell-off and largely impacted Ethereum (ETH) and altcoins. Moreover, the crackdown on real-world assets (RWA) investments in China has dampened the institutional appetite, which has added more pressure to the sentiment.

The market has high volatility, and it is strongly correlated with the Nasdaq, that had a correlation of +0.92. This has increased volatility that is caused by the macroeconomic factors. The sentiment of fear, as indicated by the CoinMarketCap Index of 39, has discouraged the inflow of new capital in the market.

Bitcoin (BTC) is holding above $112,000, while Ethereum (ETH) is steady at over $4,125. The other cryptocurrencies are moving in a sideways direction, with neither the bullish nor bear markets gaining momentum.

The crypto market has been experiencing significant changes over the last day, and key regulatory actions and funding decisions have been taking place. Here's a breakdown of today's key events.

CFTC Initiative Expands Crypto Market Access

A program by the Commodity Futures Trading Commission (CFTC) also allows stablecoins and other types of tokenized assets to be used as the collateral on the derivatives markets. This new initiative, announced by Acting Chair Caroline Pham on Tuesday, would mean that these digital assets would be treated in the same way that traditional collateral, cash or US Treasurys is treated.

Source: Tweet

This effort will result in cost, risk reduction, and liquidity access in international markets.

Heath Tarbert, president of Circle Internet Group, highlighted the positive impact this would have by broadening the use of stablecoins in regulated derivatives trading. The CFTC’s move builds on its Crypto CEO Forum and is part of its efforts to implement the recommendations from the President’s Working Group on Digital Asset Markets.

Fnality Blockchain Payment Firm Raises Funds

The company of the blockchain-based payments, Fnality, raised a large sum of money in its series C round of financing of $136 million, and the investors included some of the largest financial institutions in the world.

The big players include Bank of America, Citi, KBC Group, and Temasek companies that have been funding the firm. Investors such as Goldman Sachs, Santander, Barclays, and UBS, who were returning, also took part in the round.

Fnality strives to revolutionize the system of wholesale payment by using blockchain-based infrastructure related to central bank reserves. This investment will assist the company to increase its operations especially in the US dollar and the euro markets.

The payment platform of the firm introduced last year in the UK is to offer 24/7 payment rail and real-time settlement, which will offer better liquidity within the financial system.

SEC Eyes “Innovation Exemption” for Crypto

The US Securities and Exchange Commission (SEC) is considering an innovation exemption to accelerate the registration of products associated with digital assets. The chair of the SEC, Paul Atkins, announced that the SEC is in the process of writing a rulemaking to streamline the approval of crypto products before the end of the year.

Such an exemption would offer interim relief under the older securities rules that will enable crypto companies to issue new products with less oversight as the SEC formulates regulations specifically applicable to digital assets.

Atkins also highlighted a new multi-asset crypto exchange-traded product (ETP) that was approved recently in the US and provides investors with the opportunity to invest in various cryptocurrencies, such as Bitcoin, Ether, and Cardano.

The action by SEC is attributed to a larger cause of creating a more consistent and conducive environment to the expanding crypto-marketplace allowing the opportunity to invest and innovate.