2024-04-29 14:15

Also, the CFTC wants to bar Americans from betting on elections – even though it's already illegal in most U.S. states. This week in prediction markets: Polymarket bettors think Binance ex-CEO Changpeng "CZ" Zhao will spend less time in prison than what the U.S. DOJ is asking for. The CFTC weighs a ban on election derivatives. How low will the Federal Reserve go? Binance's founder and former CEO, Changpeng "CZ" Zhao, will be sentenced in a U.S. court in Seattle Tuesday. The Department of Justice said in a recent sentencing memo that he should spend three years in prison, citing the scale of his misconduct. Polymarket bettors think he'll be out much sooner. "Yes" shares for the "less than six months" contract on the crypto-based prediction market platform were trading at about 42 cents Monday, indicating a 42% chance CZ will be out in less than six months. (Each share pays out $1 if the prediction comes true, and zero if not.) Trading levels show a 17% chance he'll get 6-11 months, and a 19% chance that he'll get 12-17. All in all, the money says there's around a 96% chance that he'll be out in less than two years and a less than 2% chance he'll get sentenced for 30-35 months, which is around what the feds are asking. The traders might be counting on letters of support to help convince the presiding judge to trim the sentence significantly from what the DOJ asked for. Among those who signed such letters included in a submission to the courts were Max S. Baucus, former U.S. Ambassador to China; professors from Columbia and CZ's alma mater McGill Universities; Morgan Stanley Managing Director Sean Yang; and members of the ruling family in the United Arab Emirates. "There is no excuse for my failure to establish the necessary compliance controls at Binance,” CZ wrote in his own letter, while giving an assurance that this would be his only “encounter with the criminal justice system.” CFTC vs. political bets The U.S. Commodity Futures Trading Commission is looking to tighten the screws on prediction markets, Bloomberg reports. The regulator is considering a ban on derivatives for betting on U.S. elections and may also restrict other event contracts, including those on sports and global health crises, the news service said. This comes as the CFTC faces a lawsuit from Kalshi, which doesn't offer direct election contracts, but bets on approval rating numbers or other political events like appointments, and is challenging the agency's decision not to approve its plans for election-related contracts. Even though the Republican primary season was one of the shortest in history, as most contestants dropped out in weeks, unable to trump Donald Trump, interest in the general election is at an all-time high, going by the nearly $117 million – up from $100 million a few weeks ago – bet on a Polymarket contract about its outcome. On paper, this $117 million would not have come from Americans, because part of a settlement with the CFTC requires Polymarket to block U.S.-based users. Keep in mind that at a state level, betting on elections is widely illegal. Nevada spells it out clearly in Nevada Revised Statues § 293.830, which says "Any person who makes, offers or accepts any bet or wager upon the result of any election, or upon the success or failure of any person or candidate, or upon the number of votes to be cast, either in the aggregate or for any particular candidate, or upon the vote to be cast by any person, is guilty of a gross misdemeanor." New Jersey and Texas also have similar language on the books. In some other states, gambling on everything is illegal, unless specifically authorized otherwise or if it takes place on Native American tribal territory; this specific authorization is how online sports betting became legal state-by-state. In other countries, election gambling is also illegal. In Taiwan, the Presidential and Vice Presidential Election and Recall Act specifically prohibits it, and a Polymarket contract about that nation's recent general election led to arrests and a complete national-level block of its domain. PredictIt, a popular U.S. election betting site, is allowed to operate under a no-action letter from the CFTC which limits the number of bettors on each question to 5,000 and the size of each bet to $850. The regulator yanked the letter last year and ordered PredictIt to shut down but the platform sued and won the right to stay in business, for now. Will U.S. interest rates drop below 5.25%? There's renewed talk of the Federal Reserve cutting rates, as fears of stagflation grip the traditional finance and crypto markets. On Kalshi – which unlike Polymarket is licensed by the CFTC, does business only in the U.S. and settles bets in dollars – the highest single probability (37%) is for zero cuts this year, although there's a combined 60% odds for 1-3 cuts. When the cuts come, how low will they go? Lower than 5.25%, the hive mind says, giving it a 62% chance, and a 36% chance of it being lower than 5%. The central bank's benchmark rates is currently at 5.5%. Of course, the last time the Fed seriously cut rates was during the Covid-19 pandemic, and before that, in 2019 as a way to hedge against the possible consequences of then-president Trump's trade wars with China. It was a very different time back then, as the Fed said there wasn't enough inflation. https://www.coindesk.com/markets/2024/04/29/binances-cz-will-spend-less-than-a-year-in-prison-polymarket-traders-bet/

2024-04-29 11:31

The Japanese yen swung wildly on Monday, recovering 500 pips from over three-decade lows on suspected BOJ intervention. BTC drew a slight premium in Japanese markets on Monday as the yen swung wildly in holiday-thinned trading. FX volatility is on the rise, and it could impact the crypto market, one observer said. Bitcoin (BTC) traded at a slight premium on Japanese markets on Monday as the sliding yen (JPY) suddenly switched gears and surged against the greenback, bearing all hallmarks of central bank intervention. The bitcoin-japanese yen (BTC/JPY) pair on leading Japanese crypto exchange bitFlyer traded at roughly 0.2% premium to bitcoin’s dollar-denominated price on the Nasdaq-listed Coinbase (COIN), data from charting from TradingView show. CoinDesk reached out to bitFlyer for comments and awaited a response at press time. The leading cryptocurrency by market value has consistently drawn a premium in JPY terms in recent weeks. Early this month, the premium rose as high as 1.49%, the highest since March 2020, a sign of traders diversifying into alternative assets to bypass the yen volatility. “Currently, the bitcoin premium on Japanese markets is hovering around 0.3%-0.4%, having declined from over 1% in mid-April and a yearly high of 1.7% reached in mid-March. However, this could change. Overall, FX volatility is rising due to increasingly divergent monetary policy expectations and geopolitical stress, and this could impact crypto,” Dessislava Aubert, an analyst at Paris-based Kaiko, told CoinDesk. The yen swung wildly in a holiday-thinned Japanese trading session on Monday, initially sliding to 160 percentage in points (pips) per U.S. dollar, the lowest in 34 years, only to bounce back 500 pips to 155 pips per USD during the early European hours. The recovery’s speed and magnitude spurred talks of BOJ intervening or selling dollars to put a floor under the yen. Local media neither confirmed nor denied the rumored BOJ action, saying the low liquidity conditions and caution about potential central bank action near 160 pips led to the sudden yen surge. The yen has fallen out of investor favor as burgeoning public debt keeps the Bank of Japan (BOJ) from matching U.S. interest rates. In other words, Japan’s fiscal crisis has been playing out in the FX market. The Federal Reserve (Fed) is scheduled to hold a policy meeting this week, during which it could stress the need to keep rates elevated at 5.25% for longer amid sticky inflation. Last week, the BOJ kept the benchmark interest rate unchanged at 0-0.1%, having lifted it above zero early this year. The central bank maintained an ultra-lose monetary policy through the 2022-23 Fed tightening cycle, motivating traders to sell the yen. https://www.coindesk.com/markets/2024/04/29/bitcoin-trades-at-slight-premium-in-yen-terms-amid-suspected-boj-intervention/

2024-04-29 08:57

Investment platforms will take some time to establish the necessary compliance framework to sell bitcoin ETF products, the report said. Bitcoin ETF slowdown is a short-term pause not the beginning of a negative trend, the report said. Broker’s expectation of a bitcoin high of $150,000 by 2025 remains the same. The bitcoin mining cycle remains healthy after the halving, Bernstein said. The slowdown in bitcoin (BTC) exchange-traded fund (ETF) inflows is a short-term pause before ETFs become more integrated with private bank platforms, wealth advisors and more brokerage platforms, and not the beginning of a worrying trend, broker Bernstein said in a research report on Monday. The broker notes that the world’s largest cryptocurrency has been range-bound in terms of price, with no clear momentum on either side following the halving. “There is a natural gestation time to bitcoin becoming an acceptable portfolio allocation recommendation and the platforms establishing the compliance framework to sell bitcoin ETF products,” analysts Gautam Chhugani and Mahika Sapra wrote. Bernstein says its expectation of a bitcoin cycle high by 2025 of $150,000 remains the same, as the “unprecedented ETF demand inflows have further reinforced our conviction.” The bitcoin mining cycle remains healthy after the halving, with the leading players continuing to consolidate market shares, the report said. Bitcoin network fees have normalized at a healthy 10% of miners revenues having spiked post the halving, the report added. The quadrennial reward halving took place earlier this month and slowed the rate of growth in bitcoin supply. https://www.coindesk.com/business/2024/04/29/bitcoin-etf-slowdown-is-a-short-term-pause-not-the-beginning-of-a-negative-trend-bernstein/

2024-04-29 08:36

U.S citizens residing abroad are also banned from using the service zkSNACKs has barred U.S. users from Wasabi Wallet indefinitely. The decision is likely due to the recent Samourai Wallet founders’ arrest and the prosecution of Tornado Cash's developers. The developer of privacy-focused Wasabi Wallet, zkSNACKs, has banned U.S. citizens and residents from using the platform. “In light of recent announcements by U.S. authorities, zkSNACKs is now strictly prohibiting U.S. users from using its services. An IP address blocking for U.S. residents is effective on wasabiwallet.io, api.wasabiwallet.io and zksnacks.com,” the team wrote in a blog update. The incident the post is referring to is the arrest of the founders of Samourai Wallet, who have been charged with money laundering. This all follows the arrest of Tornado Cash co-founder Roman Storm, who faces allegations of money laundering and sanctions violations, as the Department of Justice accuses Storm and his co-developer Roman Semenov of facilitating more than $1 billion in money laundering via their mixing protocol, including, allegedly, for North Korea’s Lazarus Group. https://www.coindesk.com/policy/2024/04/29/wasabi-wallet-developer-blocks-us-citizens-and-residents-after-samourai-wallet-arrests/

2024-04-29 07:17

Brandt's latest view is based on a statistics concept called "exponential decay." Bitcoin’s bull market may have ended at the recent record high of over $73,000, veteran chart analyst Peter Brandt said. Brandt said that bitcoin's recent price high of near $74K has already topped according to historical data. Peter Brandt, veteran chart analyst and CEO of Factor LLC, who was previously uber-bullish on bitcoin (BTC), has switched sides. In a report shared with CoinDesk, Brandt suggested that bitcoin’s upward trajectory may have reached its peak. This starkly contrasts his February prediction that the bullish cycle, starting from the bear market lows in November 2022, could extend out to September 2025, with prices reaching as high as $200,000. The latest projection is based on a statistical concept called “exponential decay,” which describes the process of reducing an amount by a consistent percentage rate over a period. “Bitcoin has historically traded within an approximately 4yr bull/bear cycle, often associated with the halving events. There have been three major bull market cycles since the initial bull cycle and each cycle has been 80% less powerful than its predecessor in terms of the price multiple gained,” Brandt said. “If the statistical constant of the 80% decay holds true, the [record] high in bitcoin of $73,835 of March 14, 2024, has already reached a price consistent with the historical Exponential Decay,” Brandt added. Brandt predicted bitcoin's 2018 collapse to under $4,000. The table shows the magnitude or gain multiple of previous bitcoin bull runs and exponential decays. The first rally saw prices rise from $0.01 to $31.91, marking a 3,391x increase in less than two years. Subsequent bull markets have been longer in duration but smaller in magnitude, consistently suffering a roughly 80% exponential decay. Bitcoin’s rally to record highs above $73,000 in March marked a 79.1% upswing from the bear market low of $15,473 reached after the collapse of the crypto exchange FTX in November 2022. So, if exponential decay theory is a guide, the bull market may be over. That said, past data does not guarantee future results, more so, as historically, Bitcoin blockchain’s quadrennial mining reward halvings have bolstered bullish trends. The fourth reward halving took place on April 20, reducing the pace of per-block supply emission to 3.125 BTC from 6.5 BTC. As such, the consensus in the crypto community is that bitcoin’s ongoing consolidation between $60,000 and $70,000 would resolve in a bullish move. "The ‘Pre/Post Halving’ cycle construct would suggest that the current bull trend will reach a top in the $140,000 to $160,000 range sometime in late summer/early fall 2025,” Brandt said, adding that the thesis remains the primary driver of his bitcoin ownership status. Brandt, however, added that the exponential theory remains on his radar until evidence emerges that “such decay will not influence the bull trend that began in November 2022.” Bitcoin changed hands at $62,300 at press time, down 1.5% on a 24-hour basis. https://www.coindesk.com/markets/2024/04/29/chart-veteran-who-predicted-bitcoins-2018-collapse-says-the-bull-market-may-be-over/

2024-04-29 06:50

Bloomberg's report cited "people familiar with the matter, who asked not to be identified as the information is private." Australian Securities Exchange (ASX) is expected to approve the first batch of spot bitcoin ETFs before the end of 2024, according to a Bloomberg report. At least two entities have applied with the ASX, and another is working towards it, the report said. The Australian Securities Exchange (ASX), which accounts for 90% of Australia’s equity market, is expected to approve the first spot-Bitcoin {BTC} exchange-traded funds (ETFs) before the end of 2024, Bloomberg has reported, citing people familiar with the matter. Local entity, DigitalX Ltd. applied in February, the report said. VanEck resubmitted an application in February, it announced last month. Sydney-based BetaShares told Bloomberg it is working toward launching a product on the ASX. ASX said it could not add anything to its last email response to a CoinDesk request for comment in January. Back then, ASX told CoinDesk that it “does not comment on investment product applications” but that it “continues to engage with a number of issuers that are interested in admitting crypto-asset-based ETFs.” Momentum for Bitcoin ETFs in and around Asia has picked up after U.S. approvals. Hong Kong officially approved the first batch of spot bitcoin and ether ETFs last week. Earlier this month, Australia-based Monochrome Asset Management applied for a spot bitcoin ETF with the global listing exchange, Cboe Australia, CoinDesk reported. Cboe Australia is a smaller rival of ASX. At the time of the announcement, Monochrome said it selected Cboe Australia because of its expertise across Asia and broader investor access, among other aspects. Read More: Bitcoin ETFs in and Around Asia After U.S. Approvals? Analysts Are Optimistic About Momentum https://www.coindesk.com/policy/2024/04/29/australian-securities-exchange-could-approve-spot-bitcoin-etfs-before-2024-end-bloomberg/