Here are some of the major developments in the world of crypto over the past few days.
The Crypto Fear and Greed Index came in at 27, the lowest since January 2023, when Bitcoin was changing hands for $16,500. Several major factors seem to be instrumental in such a steep slide. First, the German and U.S. governments are selling large portions of confiscated Bitcoin, thus putting considerable selling pressure on the market.
Another event adding to the selling pressure is the start of Mt. Gox repayments amounting to more than $9 billion in Bitcoin and Bitcoin Cash, with the overall intention of the creditors being able to realize assets.
Against these strong headwinds, there are some positive signs. The Bitcoin Exchange Reserve has consistently fallen since 2021 and might mean investors are taking their BTC off exchanges, thus limiting the downside accordingly. Further, Bitcoin miners seem to be exhausted in selling pressure, with both the Miner Supply Ratio and Miners Position Index showing very few sell-offs are coming from this cohort.
Though near-term prospects remain uncertain, with prices as low as $50,000, a timely Federal Reserve interest rate cut in September might trigger a market rally, once again boosting investor sentiment.
DeFi Technologies to Acquire Stillman Digital, to Become "Smaller Version of Galaxy Digital"
DeFi Technologies (CBOE: CA DEFI) has agreed to a deal to acquire Stillman Digital, one of the larger OTC desks and digital-asset liquidity providers, in an all-equity deal worth about CA$4.22 million ($3.1 million). This buy will transform DeFi Technologies into a "smaller version of Galaxy Digital", industry experts estimated.
This will bring about results not far from Galaxy Digital's product offerings—a DeFi platform that will have crypto-asset management, execution trading, and proprietary trading all under one roof. Such a strategic move will further aid DeFi Technologies in rising with momentum in the industry, increasing competition, and firmly establishing it as a formidable player in the evolving crypto market.
DeFi Technologies CEO Olivier Roussy Newton viewed the acquisition as pertinent and regarded it as "a strategic step that not only expands our capabilities in the trading sector but also diversifies our client base and revenue streams." This acquisition is part of a broader trend in the crypto industry where platforms will be chasing scale and diversification to get the ability to succeed in this extremely dynamic market.
Argentina Leads in Crypto Adoption Amid High Inflation
Argentina leads the crypto market across the Western Hemisphere, pumped up by an inflation rate of 276%. Such a dire economic reality has pointed its people to find solace in digital assets, as stated in a recent study featured in Forbes magazine. According to the study, 2.5 million out of the 130 million visitors to the 55 largest crypto exchanges worldwide come from Argentina.
The country is the top market on the world's biggest crypto exchange giant, Binance. Argentina represents 6.9 per cent of the total web traffic for the platform, indicating an ever-growing interest in the country for digital currencies. However, in stark contrast to an upsurge in the memecoin industry, Argentinians prefer holding stablecoins like Tether (USDT) to protect their savings from the onslaught of the country's high inflation rates.
Contrary to these general intentions, Argentina has not yet brought in a comprehensive and well-structured regulatory framework for the industry. Though Argentina made some headway into them in 2014 by passing the crypto firm registration requirements, none of the major exchanges in Argentina has registered with the national securities regulator, the Comisión Nacional de Valores (CNV). This grey area in regulation is posing problems for the expansion and growth of the sector.