Is BTC losing its edge?

Good morning! Welcome to The Daily Moon. Jesse Powell is tired. The CEO of crypto exchange Kraken is giving it all up to become chairman. Powell claims he wasn’t having fun anymore. Or was it making fun of others? That always confuses us.

The Fed rate hike spooked the markets. Bitcoin was at $19,100 levels while Ethereum slipped to ~$1,300. Nasdaq slid in early trade. Back home, Sensex and Nifty also fell due to the Fed impact.

BTC Isn’t Your Cushion Yet

The US Fed hiked interest rates again and Bitcoin fell almost immediately. But this time around, there was not as much whale activity to buy Bitcoin. The token seems to have lost its “shield against price rise” tag.

Not an inflation hedge?Let us break this down first. Inflation, aka price rise, happens when the demand for goods is more than the supply. That is when central banks step in to control inflation through interest rate hikes. The argument has been that Bitcoin is a hedge or barricade against it. The reasons?

1. Bitcoin is decentralised, so no government or central bank can control it.

2. Token supply is predictable since only 21 million BTC can ever exist.

3. It is easy to access on exchanges via mobile wallets.

But volatile crypto prices have disproved the argument. Bitcoin fell ~60% since the beginning of the year. Inflation is still high.

There’s still hopeInflation is also caused because of public distrust in central banks. Crypto may become the alternative since these don’t have too many terms and conditions attached. But the Terra-Luna crash led to chaos in the market. Transaction volumes have dipped. Plus, regulators such as the US SEC are keen on regulating crypto in the harshest way.

At a time when governments want to control monies, Bitcoin is one avenue to keep the state away from our cash. Maybe it isn’t the magic pill just yet, but who knows what the future holds?

Ripple Is Headed For A Climax

The Ripple vs SEC finale is here. Both parties want to wrap up the legal case as soon as possible. Ripple’s XRP token is in celebration mode and is at a 16-week high.

FYI Ripple and SEC have been fighting a case over XRP since 2020. SEC wants XRP to be regulated just like stocks, something that Ripple doesn’t want.

What’s brewing?Ripple’s confident that their side will win the case. That is huge, not just for XRP, but for the crypto community. There’s some buzz after a meeting between a US markets official and Ripple. So it is no surprise that the token’s been on the rise since last week.

What’s next?While the SEC-Ripple case outcome is unclear, it may lay a benchmark for other tokens. If Ripple wins, the SEC will have to budge. XRP, that’s borne the weight of this lawsuit for two years, will finally get a breather.

Cash Is Running Out For Miners

It’s a tough road for crypto miners. Profits have slumped, costs have increased, and debt has piled up. And Ethereum’s Merge took away another opportunity. To top it all, banks have refused to fund crypto mining.

Wanna stay awayLoans to crypto miners don’t make business sense. Miner revenues have slipped, which means they won’t have enough funds to repay loans. Plus, there’s the ESG issue. Mining needs a lot of electricity, and banks don’t want to support the not-so-eco-friendly sector. Simultaneously, politicians want to monitor crypto mining’s negative impact on the environment.

Now what?Miners have turned to crowdsourcing to stay in business. DeFi platform Maple Finance will set up a $300 million capital pool to help miners. The market predicts that mergers and acquisitions will become common among miners. The community has huddled together to somehow survive this cycle.

FTX’s Messiah Complex

Maybe you are tired of hearing this, but here we go again. Sam Bankman-Fried wants more capital, to save crypto. Obviously. His crypto exchange FTX wants to raise $1 billion to acquire more crypto firms.

I am here to save youFTX raised $400 million in January to buy out companies. It’s ready to buy BlockFi and is keen to snap up the bankrupt Voyager next.

What’s on his mind?SBF wants to own a crypto powerhouse that has companies across DeFi, lending, and trading. He’s lobbied hard to push the crypto agenda in the US. Now he’s eager to walk the talk. This is his time to become a major player on the world stage. And he wants to take it.

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Who are we? There is a lot happening in our world. Everything has layers, and each layer has to be carefully peeled so you, the reader, know how the world of money is changing every day. That’s our promise. Help you unpeel the onions, which are the public markets in the US, India, and crypto, so that you know just a little more.