Bitget Hot Takes (December 05 - December 11)
Bitget Hot Takes is the exclusive weekly newsletter series by Bitget Academy, the 360-degree onboarding guide for all crypto enthusiasts.
Bitget Hot Takes last week can be found here.
• BGB momentum slowed down.
• Two biggest events to watch for in the next few days: FOMC meeting (Dec 13-14) U.S. Senate FTX hearing with SBF (Dec 14).
• The ripple effect of FTX collapse continued to spread.
• More job cuts in tech.
BGB Momentum Slowed Down
Approximately one week after BGB made the record all-time high on October 21, 2022, there was a sharp decline in the accumulation trend, meaning traders took the opportunity to capitalise on gains from BGB. We have been in a phase of no-distribution zone ever since, with the original RSI index soon to reach the oversold level. In short, we can expect a new local peak in the short-term future, but until then, it’s extremely unlikely that there will be any radical move from BGB.
For BGB’s price movements in the last few months, check out our BGB Sail series here:
Events To Watch For This Week
The two key events for the week are:
• The last FED meeting of 2022 on December 13 - December 14 and the interest rate decision on December 14;
• FTX Hearing in the U.S. Senate with the testification of Sam Bankman-Fried (SBF) on December 13
Until there is a decision on the next interest rate hike, most cryptocurrencies will most likely be trading sideways with a lower volume than usual - an indication that traders have become less active during the FOMC blackout period. The current consensus is showing a projection of less than 0.75%, according to FedWatch Tool.
Source: FedWatch Tool
Meanwhile, the notorious SBF has confirmed that he’ll be testifying before the U.S. House on December 13 (Tuesday) to help shed light on the collapse of FTX, which has caused many big players in the crypto industry to go into limbo, if not to go bankrupt, thus capturing the attention of regulatory watchdogs.
Crypto lender Genesis did not only have US$175 million stuck on FTX but also made loans to Alameda Research. And with Genesis being the official partner of the Gemini Earn program, the impact is enormous. A report by CoinDesk reveals that Genesis currently owes US$1.8 billion to their creditors, including US$900 million to Gemini users.
Some other crypto players hit by the fall of FTX include M11 Credit (a pool delegate of Maple Finance), Maple Finance, Orthogonal Trading and Nexus Mutual. It turned out that the Sydney-based hedge fund Orthogonal Trading ‘have been operating while effectively insolvent’, therefore unable to pay back the US$10 million USDC loan to M11 Credit on Maple Finance and received a notice of default for four loans totalling US$36 million in the USDC and wETH pools. Maple Finance, of course, took the hit, with MPL (Maple Finance’s native token) down by -23.55% in the last seven days. Insurance products provider Nexus Mutual is expecting a 2,461 ETH (ca. US$3 million) loss due to their exposure to the wETH pool on Maple Finance.
Off-shore crypto companies are being addressed by the European Commission with regards to reverse solicitation (i.e. passive servicing), that is, when foreign crypto asset service providers are contacted by EU residents themselves, without being affected by any promotion or publicity by such entities, and reporting on transactions of EU-based clients to tax authorities. Hong Kong has already passed the Amendment Bill 2022 that introduces a new licensing regime for virtual asset service providers, with tracking customers’ crypto purchases being one major requirement.
The U.K. is set to announce new crypto regulations, which should be similar to the EU’s MiCA. It is meant to better protect the British from cases like FTX and provide clearer guidelines to support the development of the crypto industry in the region, in addition to the Edinburgh Reforms (keywords: innovation, technology people and businesses across the UK).
A potentially good news is that the North Carolina Republican Patrick McHenry is selected as Chairman of the House Financial Services Committee. He has been a supportive fintech advocate and voicing his interest in crypto policies publicly on Twitter for quite some time.
The Latest Bitget News
Argentina has entered the Semi-final round with Messi already having scored four goals and two assists in Qatar 2022 for the team. Congrats to our Hero and we wish him a smooth ride to the final match! Show us the spirit by predicting the results of the next games and share ONE MILLION BGB as rewards!
Sharing is caring: Seed, Bitget’s first and exclusive NFT collection, is launching, with the first batch directly distributed to FTT holders to assist them on this difficult transition. We are here to help the crypto community with unwavering dedication - check out our US$200 million Bitget Protection Fund and our US$5 million Builders’ Fund as well!
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