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Crypto News

Major Policy Shift: Trust Funds Gain Green Light to Promote Cryptocurrency on Google

Google, the world's largest web search engine, has made a significant policy shift by allowing advertisers in the U.S. to promote cryptocurrency coin trusts on its platform. The company initially expressed its intention to permit such advertising in December of the previous year, and this change finally came into effect last Tuesday. This decision is believed to be influenced by the anticipation surrounding the potential approval of the first U.S. Bitcoin Spot ETFs by the Securities Exchange Commission (SEC), a milestone that was officially reached on January 10, 2024.

Historically maintaining a strict no-advertising policy for cryptocurrencies since March 2018, Google's revised stance requires advertisers to adhere to the specific laws and regulations of the countries they target. A crucial aspect of these regulations is the obligation to warn potential investors about the inherent risks, emphasising the potential loss of funds associated with cryptocurrency investments.

Following the recent policy update, notable financial entities such as BlackRock and VanEck, managing their Bitcoin Spot ETFs, became the first to advertise on Google. Likely, other companies will soon follow suit with their cryptocurrency offerings. This development is anticipated to profoundly impact these firms and, more broadly, contribute to the ongoing global adoption of cryptocurrencies.

Transak Revolutionises Web3 Payments: Unleashing Swift Currency Transactions Through Visa Direct

Transak, the decentralised payments firm serving as a fiat-to-crypto on and off-ramp for decentralised applications (dApps) and crypto wallets, has forged a strategic alliance with Visa Direct. This collaboration aims to empower customers to seamlessly convert their cryptocurrency holdings directly to traditional fiat currency, instantly accessible through their Visa cards.

As a pioneering web3 startup that successfully secured $20 million in funding last year, Transak is dedicated to streamlining the cryptocurrency exchange process. This partnership now allows Visa users across 145 countries and 130 million merchant locations to exchange their cryptocurrencies for local currencies effortlessly. Transak also addresses the crucial 'Know Your Customer' (KYC) process, a requirement for users engaging in cryptocurrency transactions, by handling risk monitoring and compliance procedures.

Yanilsa Gonzalez-Ore, the North American head of Visa Direct, emphasised the significance of this collaboration. The partnership supports more than 40 major cryptocurrencies, including Bitcoin, Ethereum, Solana, and Dogecoin, providing users with a swift and efficient means to process their transactions in less than 30 minutes. This integration facilitates the seamless conversion of crypto to fiat and ensures compliance with regulatory requirements, marking a significant step towards a more accessible and user-friendly cryptocurrency experience. 

As cryptocurrency continues to gain traction, partnerships like these contribute to creating a more user-friendly environment for individuals looking to integrate digital assets into their everyday transactions seamlessly and this collaboration marks yet another stride in the cryptocurrency space towards widespread adoption.

Galactic Debut: Jupiter DEX Soars on Solana with Airdrop Launch

The highly anticipated Jupiter project, a decentralised exchange (DEX) operating on the Solana network, made its debut on Wednesday, distributing approximately $700 million worth of its native JUP token to nearly a million wallets. Claiming to build the ultimate decentralised exchange replacement, Jupiter swiftly achieved a $6 billion market cap post-launch. Initial bids priced at $0.47 surged to $0.87 on the Binance Exchange and an impressive $2.10 on the Kucoin Exchange.

The launch was deemed successful despite concerns over potential strain on the Solana network due to heightened activity. While the first 30 minutes saw challenges with RPC nodes—acting as intermediaries between wallets and the network—these issues were swiftly resolved. A notable 20% of the 1 billion tokens allocated for user distribution were claimed, contributing to the brief disruptions.

To ensure a seamless main airdrop, the project conducted mockJUP and WEN mock airdrops, testing liquidity pools and launchpad infrastructure (LFG). These preliminary trials likely contributed to the overall success of the launch. George Harrap, co-founder of Step Finance, a Solana-based data service, highlighted validators as the true beneficiaries, earning MEV priority fees, akin to tips.

As of the latest update, the JUP token is valued at $0.63, with a fully diluted market cap surpassing $6.2 billion. The project's strategic testing measures and positive market response position Jupiter as a noteworthy player in the evolving decentralized exchange landscape.

In Other News

IllumineX Dex Takes Off on Oasis Network

Bitcoin Bandit Busted: £1.4 Billion Seized as Former Takeaway Worker Faces Justice in Court

Stella Bug : Foundation Backs Delay of Smart Contracts Upgrade

Hong Kong Welcomes Its Inaugural Bitcoin Spot ETF Application

Crypto Analysis

Bitcoin (BTC)

Bitcoin's recent performance has been relatively stagnant, maintaining a position above the 10-day exponential moving average (EMA) with attempts to breach daily and weekly resistance. In the past week, a surge on Monday propelled the price to a weekly high of $43,882, yet it fell short of breaking through the anticipated resistance, denoted by the green horizontal box and the red arrows on the daily chart. Subsequently, the price retraced towards the week's opening, followed by another upward move. However, the current sideways movement suggests a cautious "wait and see" approach within the world's largest digital asset.

Examining indicators, the Stochastic RSI remains in overbought territory without significant downward pressure, indicating a positive trend. Meanwhile, the RSI indicator resides in a mid-range, signifying potential price movement in any direction, with notably weak volume. The crucial horizontal support line shown by the green arrows from the previous week, positioned at around $41,250 region retains significance and warrants close observation in case of a descent to that level.

On the weekly chart, a bullish pin bar from the preceding week led to a bounce off the 50% level, corresponding to the swing high of $48,969 and swing low of $38,555. This pivotal point, at $43,762, holds importance despite not being a Fibonacci number, acting as a crucial midpoint between bullish and bearish sentiments. Visible resistance is apparent at this juncture, indicated by the highlighted black line hovering over the 50% line.

In conclusion, breaking the $44,000 level is paramount, given its recent struggle to surpass in previous weeks. A retest of this price with substantial volume and solid price action could propel Bitcoin to the 0.618 Fibonacci level of $44,991 on the weekly chart and beyond to new monthly highs. We will continue to monitor Bitcoin on a weekly basis.

TOTAL3 (All Altcoins excluding major stablecoins)

The Total 3 chart, encompassing all altcoins excluding major stablecoins, is currently tracing a downward-sloping trend channel marked by successive lower lows and lower highs. The price appears to be in search of a base, evident in the lower horizontal green shaded zone and indicated by red arrows on the daily chart as it has tested this area about 5 times since December of last year. An intriguing prospect emerges if the price manages to break above the upper horizontal resistance zone, highlighted by green arrows and positioned around the $370 billion mark. Such a breakthrough would mark the first deviation from the daily structure since the early January highs and a break to the upside of the established trend channel.

A potential retest of the lower green horizontal support should not be immediately deemed negative. In fact, if the descent to that level occurs with lower-than-average volume, there is a likelihood of forming a daily double bottom. The mid-ranging RSI indicator indicates flexibility in price movement across all directions.

Turning attention to the weekly chart, there are signs that a major low may have been established. The bounce off the 0.382 Fibonacci level, calculated from the December 2022 lows to the recent January highs at $320.114 billion, suggests a potential turning point. Taking all factors into consideration, it appears that altcoins might be in the process of finding a low around these price levels. However, a decisive break in structure, particularly around the previous swing high (last green arrow), combined with a breach above the trend channel, is essential for confirmation. We look forward to coming back to the Total 3 chart when any further developments occur.

Ethereum (ETH)

For our third chart of the week, let's dive back into Ethereum. The current situation is interesting, as the price is at a crossroads—either it bounces back from support or breaks through resistance. We're right in the middle, and both scenarios could unfold in the next few days.

Last week, Ethereum made a move, testing the daily resistance around $2,391, marked by a blue line and arrows. Unfortunately, it couldn't breach that level, and took a step back. Now, we're eyeing a potential drop toward support at $2,177 shown by the black horizontal line and black arrows.

On the flip side, if Ethereum regains momentum and manages to retest the recent highs, breaking and closing above around $2,391 with decent volume, we might see a revisit to the January high at $2,717. The StochasticRSI and RSI indicators are sitting mid-range, indicating the price could swing in either direction.

Zooming out to the monthly chart, Ethereum's price bounced off the 0.382 Fibonacci retracement from the highs in November 2021 ($4,868) to the lows in June 2022 ($881), landing at $2,404. There's a cluster of resistance around this area, marked by a blue line and two red arrows, indicating a significant challenge.

In the unfolding narrative, the areas of support and resistance we've mentioned deserve a close watch in the upcoming weeks and days. The Ethereum saga continues, and the market's short term daily price action will likely guide our next moves.

Macro News

Inflation and Monetary Policy

The US economy continues to be resilient, with 2023 Q3 GDP growth at 4.90%, 2023 Q4 growth at 3.3% and Atlanta Fed’s GDP Nowcast estimating 20204 Q1 growth at 4.2% to date:

Unemployment at 3.7% which is back to pre-covid levels and below the long term average:

Whilst Fed chair Jerome Powell has stated strong growth and low unemployment are good, such strong growth numbers are well above the long-term annual GDP growth trend of 2-3%. This is keeping the Fed wary of cutting rates too soon, as above-trend growth tends to lead to inflation remaining stubbornly above the central bank’s 2% inflation target.

One indicator used by those calling for a recession has been the Institute of Supply Management (ISM) Purchasing Managers’ Index (PMI), which surveys hundreds of manufacturing and service suppliers. PMI prints above 50 indicate growth and below 50 indicate contraction, with prolonged periods in the mid to low 40s typically signalling imminent recession. Combined goods and services PMI levels have been below 50 since November 2022:

T his led many (myself included, initially) to mistakenly believe a recession is around the corner. What was missed is that the global economy was shutdown during covid, followed by a re-opening growth shock and then a post growth shock rebound. As the chart above shows, the post covid ISM index hit levels not seen since the 1980s which is unsustainable for any length of time. As supply chains adjusted to the post-covid economy of work from home, changes in purchasing habits and goods/services demand, along with coming off the growth high, sub-50 ISM prints were merely signalling a return to trend and not an impending recession.

US Commercial Real Estate

New York Community Bancorp (NYSE:NYCB) made the headlines last Wednesday with their share price being cut in half following a disappointing earnings call, although this was largely due to a number of idiosyncratic factors and not indicative of wider banking trouble.

NYCB reported a $260 million loss for Q4 2023, significantly disappointing analyst expectations. Along with a 71% cut to NYCB’s dividend, this is largely what sparked the dramatic post-earnings sell-off.

The losses were due to troubled office and multi-family commercial real estate loans and costs related to the acquisition non-crypto assets held by failed Signature Bank (OTC:SBNY). Acquisition of SBNY assets pushed NYCB’s assets over the $100 billion threshold for capital requirements. Amongst other regulatory requirements, this meant the bank had to increase its loan loss provisions which are shown as a loss on the balance sheet.

Hawk-eyed market pundits noted that the NYCB news, which fell on the same day as the FOMC rate decision, coincided with the removal the statement “The U.S. banking system is sound and resilient” from the Wednesday’s FOMC statement. Is there a connection? We can’t be sure. But some are putting 2 and 2 together and concluding this may suggest further trouble in the banking sector.

Another story came from Japan’s Arizona Bank, which reported a net loss of 28 billion yen for the current financial year, which is primarily related to bad debt in the US office real estate sector.

Whilst the sharp decline in NYCB’s stock price was likely an overreaction, given the case-specific idiosyncrasies, it’s notable that this news comes ahead of the 1 year anniversary of March 2023’s banking crisis.

Mighty Meta’s Record-Setting Market Cap Growth

Meta (NASDAQ:META) impressed markets after Thursday’s trading session with better-than-forecast fourth-quarter sales, an improved outlook and a surprise announcement of the company’s first-ever quarterly dividend.

Post market gains on Thursday were around $170bn. To put it into perspective, some names in the $160-180bn market cap range are Verizon (NYSE:VZ) $178bn, Disney (NYSE:DIS) $178bn, Intuit (NASDAQ:INTU) $177bn and IBM (NYSE:IBM) $170bn.

By Friday’s close, Meta’s market cap had surged by 20.3% to $1.2bn, from $1bn on at Thursday’s close. The $197 billion of inflows into the stock marked the largest ever single-day gain in a company’s value.

Events This Week

Earnings Calendar

Earnings season continues with retail names in the spotlight this week:

Financial Market CalendarMonday

• Australia & Germany balance of trade

• US ISM Services PMI

Tuesday

• Germany factory orders

• Cleveland Fed President Loretta Mester, Philadelphia Fed President Patrick Harker speak

• RBA interest rate decision

• Canada Ivey PMI

Wednesday

• Bank of England Deputy Governor Sarah Breeden speech

• Fed Governor Adriana Kugler, Richmond Fed President Tom Barkin speak

• Canada balance of trade

Thursday

• China PPI, CPI

• Pakistan general election

• ECB Chief Economist Philip Lane, ECB Governing Council member Pierre Wunsch speeches

• ECB economic bulletin

• US initial jobless claims

• US Treasury Secretary Janet Yellen speaks at Senate banking committee hearing

Friday

• Australian Reserve Bank Governor Michele Bullock delivers parliamentary testimony

• China aggregate financing, money supply, new yuan loans

• Germany CPI