Jan 20

9 min read

Weekly Crypto Market_ Jan 20, 2023

1. Week in Review

Bank of Thailand to allow the first virtual banks by 2025. Bank of Thailand has disclosed plans to allow virtual banks to operate in the country for the first time. Financial firms will be able to provide services by 2025, a Bloomberg report shows.
One of the largest US colleges has begun teaching students about Bitcoin.Classroom adoption of Bitcoin and cryptocurrency courses continue to skyrocket, with Texas A&M now being the latest United State College to offer a Bitcoin course to some of its 74,000+ students.
Bithumb was ordered to pay outage damages to investors by a South Korean court. A ruling from local courts has Bithumb liable to pay just over $200,000 in damages to the 132 investors which filed against the cryptocurrency exchange.
Binance Will Allow Institutional Investors to Keep Collateral Off the Crypto Exchange. Binance will allow institutional investors to keep their collateralized crypto used for leveraged positions, off the platform. The exchange will enable investors to post collateral with Binance Custody, which will hold the assets off the internet, in cold storage wallets, Binance said in a statement on Monday. Once trades are settled, the assets would then become accessible to the user again.
Iran and Russia want to issue new stablecoin backed by gold. The Central Bank of Iran is reportedly cooperating with the Russian government to jointly issue a new cryptocurrency backed by gold. According to the Russian news agency Vedomosti, Iran is working with Russia to create a “token of the Persian Gulf region” that would serve as a payment method in foreign trade.
Thailand’s SEC Issues New Regulations For Crypto Custodians. The new regulations will require companies operating in the digital asset space to establish a digital wallet management system. This is to help with the efficient custody of digital assets and to ensure the safety of customers’ assets.
South Korea Launches Metaverse Replica of Seoul. South Korea is bringing Seoul to the metaverse, launching a virtual replica of the city with a goal of improving its public services. The virtual world is estimated to be completed by 2026.
Solana Foundation, Ripple, GBBC and Others Form Partnership to Promote Crypto Solutions for Climate Change. Solana Foundation and blockchain platform Ripple are partnering with industry group Global Blockchain Business Council (GBBC) to accelerate the use of crypto-based solutions for climate change.
French Crypto Companies Must Seek Authorization by 2024 Under New Lawmaker Plans. The plans offer more time than a Senate proposal, as the country prepares for a new EU crypto law.
EY and Polygon Ready Privacy-Focused Ethereum for Enterprise Release. EY’s Nightfall, a five-years-in-the-making system allowing businesses to shield the content of transactions on the public Ethereum blockchain, has entered its final phase of production readiness for deployment using the Polygon network.

Source : Coindesk

2. Cryptocurrency Price Trend

1) Cryptocurrency Market State Visualization (1W)

After the CPI announcement, expectations of easing inflation are reflected, along with the stock market, a rebound in the cryptocurrency market, and Bitcoin prices have recovered 21K. The CPI has risen 6.5% year-on-year, an absolute number, but that is the minimum in 14 months, and markets and investors are optimistic that the Fed’s aggressive rate hike will virtually enter the finishing stage and ease the tightening trend. However, the Fed is certainly committed to maintaining a higher benchmark interest rate level until prices catch up, so it is necessary to note what changes will be made to the market after the FOMC scheduled for next month.

Bitcoin rose 23.6% compared to last week and Dominance also rose to its highest level in about six months(41.2%), while major altcoins were also strong, recording ETH +19.4%, BNB +9.7%, and XRP 10.6% SOL +44%.

In particular, Solana’s rise was marked by Vitalik Buterin’s remarks in support of Solana due to the rise of the cryptocurrency market, including the release of Memcoin Bonk, and the discovery of FTX’s cash assets. However, there is a question whether it is possible to re-jump from FTX shock, and there is a mass lock-up release, so attention is also required in terms of price.

On the other hand, the Virtual Asset Fear & Greed Index has moved out of the ‘fear’ zone and reached the ‘neutral’ stage. This is the highest figure in nine months, and it is important to note that we can continue the upward rally.

Cryptocurrency Market State Visualization (1D)

Talking about the last few days, The price of Bitcoin has decreased by 1.50% during the past 24 hours to $20,550, with a $29 billion trading volume. The predicted value of Bitcoin has not changed since the initial projection on January 17th. The immediate support level for Bitcoin on the 4-hour time frame is located close to $20,630 and is extended by the 23.6% Fibonacci retracement. The next support level of $19,985, or the 38.2% Fib level, might be reached by the BTC price if the bearish breakout of $20,630 takes place.

Currently, $1,500 is Ethereum’s most crucial support level. On the basis of its 38.2% Fibonacci retracement, the selling pressure will probably intensify if this falls down and reach $1,440. If it is also broken, ETH can fall even lower than $1,350 and find itself in a tight spot. A break of the $1,500 support level is likely to result in a rise to the $1,660 level, which will act as a resistance level.

Source: The Block, Cryptodaily, Web Desk, Coinshares

2)Weekly Crypto Asset Flows

In the past week, a total of $ 9.2 M has flowed into crypto funds.

AUM increased by 13%. Ethereum stopped an eight-week outflow and recorded an inflow of $5.6M, with inflows of $ 1.3 million and $ 400,000, respectively, for Solana and Polkadat, and $ 3.3 million for Ripple, all of the funds that flowed in last week. Note that the total operating assets(AUM)of crypto funds and investment products are about $ 25.5 billion, with the strongest influence of Grayscale(67%) among commodity providers and Bitcoin(63%)among investment targets.

2)Weekly Crypto Asset Flows

Crypto Funds AUM

Flows by Asset

Bitcoin saw the largest flows of any asset, but small at US $10M, while short-bitcoin investment products saw outflows totalling US$1.5M.

Ethereum broke its 8-week spell of outflows with an inflow of US$5.6M, seemingly benefitting from the broader improvement in sentiment.Multi-asset investment products continue to suffer with outflows of US$3.2M, its 7th week of outflows which totals US$16M.

Investors pulling out of broad investment products while there have been inflows into specific digital assets, suggest they are becoming more discerning over what they invest in. In altcoins, only Solana and Polkadot saw inflowstotalling US$1.3M and US$0.4M respectively. XRPreversed the gains it had seen the prior week with outflows of US$3.3M last week.

Source: Coinshares

3. VC Investment Trends

1) The biggest deals of the week

The round is co-led by Pantera Capital and Archetype with participation from Coinbase Ventures, Nascent, BlockTower, Placeholder, Ethereal Ventures, Spartan, and IEX. We also had direct participation from top validators such as Stakely, Cosmostation, Kukis Global, Swiss Staking, Swift Staking, a41, Blockscape, and DSRV.

Parfin has raised $15 million to provide web3 infrastructure solutions to Latin America. The raise is led by Framework Ventures and also sees participation from Alexia Ventures and Valor Capital Group.

Sleepagotchi, a mobile application with gamification and social elements that helps users improve their sleeping habits across the world, raised a $3.5M seed round from investors including 6th Man Ventures, Collab+Currency, Shima Capital, 1kx, DeFi Alliance, Sfermion, Emoote, and LCA Game Guild. Notable angels include Cem Kansu (VP Product at Duolingo), Santiago R Santos, and Justin Melillo (Founder of Mona). Serge Kassardjian, General Partner at 6th Man Ventures and CEO of Staytuned, will join the Board of Sleepagotchi as a Director, and Derek Schloss, Managing Partner at Collab+Currency will join as an Observer.

Jan. 17, 2023 SYKY, a next generation luxury fashion platform, today announced the close of a $9.5 million Series A funding round. The investment is led by Alexis Ohanian’s firm Seven Seven Six. The round is also funded by Brevan Howard Digital, Leadout Capital, First Light Capital Group, and Polygon Ventures.

Web3 security infrastructure Trusta Labs has raised $3+ million in Seed Round. This round is led by SevenX Ventures and Vision Plus Capital, joined by HashKey Capital, Redpoint China Ventures, GGV Capital and SNZ Holding.

The startup announced today that it raised $3 million in a seed round led by crypto VC firm 1 confirmation, with participation from Volt Capital, Flamingo DAO, and Neon DAO.

Intella X raised $12 million from investors that include Polygon, Animoca Brands and Magic Eden.The platform is the product of a partnership between South Korean gaming company Neowiz and Polygon.It’s set to launch later this quarter.

Data accessibility protocol developer Nil Foundation has raised a $22 million round led by Polychain Capital.Other investors in the round include Blockchain Capital, Starkware and Mina Protocol.

4. Weekly Macro Economy Review

1. Central bankers pledge to ‘stay the course’ on high interest rates.

- Investors have been put on notice that central bankers on both sides of the Atlantic will “stay the course” on interest rate increases to cool down their economies and tame high inflation.

2. China’s GDP growth falls to 3% in 2022, second lowest growth in 50 years.

- 2nd slowest pace since the 1970s; retail sales and industrial production gain

3. Global shares trade mostly lower after the year’s biggest Wall St retreat.

- Global shares were mostly lower Thursday as investors grew cautious after Wall Street’s biggest pullback of the year

4. Investment banks are struggling in a high-interest-rate world.

- Investment banks’ trading businesses tend to do well in times of volatility and uncertainty, but their advisory services sell best when markets are healthy and stable. Bank bosses must try to balance their exposure to these forces.

5. Davos Latest: China Underscores Message of Cautious Optimism.

- After a three-year hiatus from its annual January slot, the business and financial elite returned to Davos to discuss urgent global issues including the climate crisis, political stability, the end of the era of cheap money, and food and energy security.

6. UK inflation eases for a second month in December, falling to 10.5%.

- UK inflation eased for a second month in December, boosting confidence that the cost-of-living crisis has peaked

Sources: CNBC, Bloomberg News, The Wall Street Journal, Reuters