Next FOMC meeting: Sept 20th 2023.
HashKey, Hong Kong's first licensed retail virtual asset exchange, is set to launch operations on Aug. 28. This comes after recent regulatory changes in Hong Kong's crypto sector and HashKey's upgrade in its licenses, allowing it to serve retail users. Livio Weng, COO of HashKey Group, emphasized the importance of licensed trading platforms for transparency and investor confidence.
The Securities and Futures Commission (SFC) of Hong Kong has been actively overseeing the region's crypto industry, issuing warnings to non-compliant platforms. Currently, only HashKey and OSL Exchange are regulated in Hong Kong, but more approvals are anticipated. HashKey's launch marks a significant evolution in Hong Kong's crypto environment, promoting transparency and security.
In less than a month since its launch, on-chain social app Friend.tech has garnered over 100,000 users. The platform, which allows users to buy "shares" of social media profiles, recently recorded $1.42 million in fees within 24 hours, ranking it the third most profitable crypto platform after Lido and Ethereum.
Having launched on Coinbase's Base network on Aug. 10, the platform has already overseen 1.3 million transactions, generating over $25 million in fees, according to DefiLlama. Built on the premise of social tokens, the platform has rapidly grown in popularity. Users can sign up, link their account from X (previously Twitter), and others can then buy shares of their profile. These shares grant privileges such as joining group chats with the profile owner, and each purchase gives the owner a "subject fee." Notably, as of Aug. 21, Friend.tech reported 80,000 unique buyers and 30,000 sellers, however, it remains unclear how many of those users are trading bots.
Komainu, a crypto custody joint venture between Nomura, Ledger, and CoinShares, has secured a full Virtual Asset Service Provider (VASP) license from Dubai's Virtual Asset Regulatory Authority (VARA). This positions Komainu among the early recipients of such a license, mirroring the growing crypto industry traction in Dubai since VARA's inception in March 2022. With the completion of VARA's four-stage licensing, Komainu can now extend institutional staking, collateral management, and other custodial services through its Komainu Connect platform to its clientele, which includes asset managers and banks. The firm, which received its preliminary operational nod in July 2022, foresees substantial growth in the Gulf region and plans to double its Dubai team size by year-end.
Stock futures are higher after Nasdaq’s best day in August. It's worth highlighting that both the broad market index and Nasdaq saw gains, even as the 10-year Treasury yield climbed to a peak not seen since October 2007, ending around 4.34%. Given that tech equities typically face headwinds in a high-interest rate scenario, the concurrent surge with yields this past Monday was indeed an attention-grabber for market participants.
Meanwhile, S&P Global took decisive action this Monday, slashing credit scores and revising its forecast for several U.S. banking entities. This move echoes a similar decision by Moody’s, emphasizing looming funding challenges and dwindling profits that may pressure the sector’s creditworthiness. Specifically, S&P reduced ratings for Associated Banc-Corp and Valley National Bancorp due to escalating funding concerns and greater dependence on brokered deposits. Further, UMB Financial Corp, Comerica Bank, and Keycorp faced downgrades, attributed to significant deposit withdrawals and the current high-interest rate climate.
The S&P500 rebounded by 2% off the important support level of 4335 which intersects with the gap posted in June during the debt ceiling debacle. On an intraday basis, price action remains capped by a declining trend line which may be a source of resistance in the short term. On a daily chart, the 20-day moving average is getting close to breaking below the 50-day moving average which would be considered a bearish sign. As long as the index trades below its 50-day moving average near 4480, we expect further downside ahead.
On an intraday basis, Bitcoin has been trading within its own tight range between 25,800 and 26,300. It might be worth taking the trade in the direction of the breakout. It seems that after such a big drop, market participants might be more willing to buy the dip rather than sell at this level, especially that we’re very close from the important support level of 25,250. Zooming out to a daily chart, we notice that the RSI was recently trading at its lowest level since the Covid crash in 2020, indicating that the recent move might be a bit overextended as it has entered oversold territory.
In other news, transaction activity for Optimism, Arbitrum, and Base soared, almost eclipsing their historical peak set in March, spurred by a sizable $1.7 billion ARB token AirDrop. With the imminent EIP-4844 upgrade poised to bolster scalability and cut down costs significantly, there's mounting anticipation for what this could mean for Layer 2 solutions within Ethereum's landscape.
Optimism, Arbitrum and Base have been going head-on recently.
Optimism is 2nd after Base in terms of its seven-day moving average daily transaction count reaching 597k right behind Base’s 610,000 and ahead of Arbitrum’s 576,000. Its daily revenue is also 2nd in line with $231,000 behind Arbitrum's $358,000 and ahead of Base’s $93,000. Daily unique addresses are at the top with 32,000 ahead of 24,000 for Base and 29,000 for Arbitrum.
Let’s take a look at a daily chart.
OPUSDT has been supported by a rising trend line since the summer of 2022. Its recent price action is still capped by a declining trend line formed on the yearly highs. If the network activity continues to improve, we believe this token can trade higher. For now, the price action is quite neutral. However, if prices break above $1.83, it could open the door for a breakout towards $2.05 and $2.35 in extension.
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