1. Home
  2. Lending

Lending

South Korean Bitcoin lender Delio plans to sue regulators: Report

South Korean financial regulators accused Delio of fraud and embezzlement and seized its assets in July earlier this year.

South Korean Bitcoin lender Delio is reportedly preparing for an administrative lawsuit against regulators for the wrong interpretation of law leading to an investigation and hefty fine against the crypto lending firm.

Bitcoin lender Delio said the allegations of fraud and embezzlement levied by the Financial Service Committee (FSC) are baseless, according to a report published in a local daily.  The crypto lender claimed that the regulator implied the law unreasonably in a situation where there were no clear regulations for virtual asset deposit and management products.

The report revealed that the Financial Intelligence Unit (FIU) recommended the dismissal of Delio CEO Jeong Sang-ho through a sanctions announcement on Sept. 1. Delio claimed that this was a clear indication that the financial authorities were putting pressure on Delio to close down the business rather than giving them a chance to revive. The FIU also imposed a three-month business suspension on Delio and a fine of $1.34 million (1.83 billion won.)

The firm also warned that the assets seized by regulators could put its operations in jeopardy.

Delio CEO Jeong Sang-ho said that these FIU sanctions leave a lot of room for unreasonable legal interpretation and arbitrary application,” and such behaviour by financial authorities could kill the domestic virtual asset industry.”

Related: UK banks risk losing licenses for debanking customers over political views

The major issue of conflict remains the interpretation of the existing laws, around whether a lending company that lends cash using virtual assets as collateral is considered a virtual asset business operator and whether the act of imposing a lock-up constitutes 'storage' of virtual assets under the Special Financial Services Act.

Delio argued that it is unclear whether virtual asset deposits and management products are considered financial products under the current law. One of the lawyers for the firm noted that there are no provisions for virtual asset-related laws and regulations regarding the virtual asset management business.

The lawyer said that the FIU arbitrarily interpreted virtual asset deposits and management products as financial investment products and sanctioned them which is the case of wrong interpretation of the law.

Magazine: Home loans using crypto as collateral: Do the risks outweigh the reward?

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

Aave v3 fork debuts noncustodial liquidity markets on Base

Seamless Protocol, a fork of Aave v3 deployed on Base, enables smart contracts with predetermined borrowing strategies to conduct undercollateralized borrowing on-chain.

A collaboration across decentralized finance (DeFi) developers is introducing a non-custodial liquidity markets on layer-2 network Base, promising to enable trustless smart contracts to automatically connect liquidity pools with borrowing strategies.

Behind the initiative are developers from Seashell, RNG Labs, and Loreum Labs, along with advisers and collaborators from Ampleforth, Uniswap and other projects. The group built the Seamless Protocol, a fork of Aave v3 that allows smart contracts with predetermined borrowing strategies to conduct undercollateralized borrowing on-chain.

"As an analogy, Borrowing Strategies are like single-purpose loans, such as home, auto, or school loans — the supplier knows exactly where the liquidity is being used, and the borrower is unable to use it for different purposes,” a contributor for Seamless told Cointelegraph, referring to undercollateralized borrowing options.

Undercollateralized borrowing isn't something new in the crypto space. Protocols such as Maple Finance offer capital to institutional and qualified investors via undercollateralized products. The process, however, requires a combination of off-chain and on-chain steps, meaning the user seeking capital will have terms negotiated with Maple’s team before a loan is issued on-chain.

“Many borrowers already know the purpose of the additional liquidity they seek, so Integrated Borrowing Strategies simply connects these steps together. Because the Borrowing Strategies are on-chain in smart contracts, the Liquidity Suppliers have full visibility into how the funds are used,” the protocol explained regarding its core strategy.

General purpose loans — such as personal loans that can be used for a variety of situations — are also integrated into the protocol, but are governed by the usual DeFi lending rules that require overcollateralization.

Seamless believes its solution is a better fit for DeFi than on-chain reputation scores or on-chain identities, such as WorldCoin's proof of personhood system. “[...] the only way to create conditions for undercollateralized borrowing would be within rails of a smart contract to smart contract system, which brings us back to the fundamentals of crypto and DeFi (trust code over humans),” a Seamless contributor said.

Magazine: Recursive inscriptions — Bitcoin ‘supercomputer’ and BTC DeFi coming soon

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

Crypto Biz: Coinbase’s lending bet, a new ads policy at Google and Marathon’s mining performance

This week’s Crypto Biz explores Coinbase's lending platform, Marathon Digital’s latest Bitcoin mining report, Hana Bank’s move to offer crypto custody and Google’s new crypto ads policy.

Crypto giant Coinbase seems to be strategically steering its ship amid constant crypto industry turbulence in 2023. The company recently unveiled its lending platform for institutional investors, aiming to fill the void left behind by major players during 2022’s crypto winter, when firms such as Celsius Network, BlockFi and Genesis went bankrupt. 

The move comes after the company shut down its Borrow service for retail customers in May amid regulatory scrutiny. The service allowed certain customers to use crypto as collateral to receive a cash loan. The new lending solution, however, focuses on institutional investors — companies or organizations investing on behalf of their clients, such as mutual funds and pension plans.

Coinbase’s new venture amassed millions in capital within a few days of launching, documents filed with the United States Securities and Exchange Commission (SEC) show. Despite headwinds and uncertainty, the service debut indicates that crypto lending among high-profile investors is still in demand in the United States.

This week’s Crypto Biz also explores Marathon Digital’s latest Bitcoin mining report, Hana Bank’s move to offer crypto custody and Google’s new crypto ads policy.

Coinbase launches crypto lending platform for U.S. institutions

Crypto exchange Coinbase has rolled out a crypto lending service for institutional investors in the U.S., which reportedly seeks to capitalize on massive failures in the crypto lending market. According to a filing with the SEC, Coinbase customers have already invested over $57 million in the lending program since the first sale occurred on Aug. 28. In another headline, Coinbase’s recently released Base network reached over 700,000 nonfungible tokens (NFTs) minted in August. The tokens minted were part of the launch’s strategy to spur adoption. Base’s launch, however, has not been flawless. The network suffered an outage on Sept. 5 when its sequencer stopped producing blocks. Several scams have also been promoted on the network, including a $6.5 million rug-pull by Magnate Finance.

Data from a SEC filing by Coinbase Credit. Source: Coinbase SEC Filings

Marathon’s Bitcoin mining rate fell 9% in August

Crypto mining operator Marathon Digital Holdings produced 1,072 Bitcoin in August — 9% less than in July. According to the company, the smaller production resulted from increased curtailment activity in Texas due to record-high temperatures. The term curtailment refers to the reduction of electricity generated to maintain a balance between demand and supply. The temporary shutdowns more than offset the progress made by the company to increase its operational hash rate and optimize operations, according to its CEO, Fred Thiel. Marathon increased its U.S. operational hash rate by 2% month-over-month to 19.1 exahashes in August. The performance increase is attributed to the upgrade of Bitmain Antminer S19j Pro miners to the more efficient S19 XP models.

Google will allow ads for NFT games starting Sept. 15

Google has updated its cryptocurrency advertising policy to allow for blockchain-based NFT gaming advertisements as long as they don’t promote gambling or gambling services. The new policy will continue to ban advertisements for games that allow players to wager or stake NFTs against other players or for rewards. NFT casino games offering players to wager or play for prizes — such as NFTs, cash or cryptocurrency — will also continue to be banned. Google previously banned all cryptocurrency-related advertising across its platforms in March 2018. 

South Korean Hana Bank enters crypto custody business with BitGo

One of the largest South Korean banks, KEB Hana Bank, is moving to offer digital asset custody services through a new partnership with cryptocurrency custody firm BitGo Trust Company. According to local media reports, KEB Hana Bank signed a strategic business agreement with BitGo to jointly establish digital asset custody in South Korea. The commercial bank has a network of 111 branches with local banking assets of nearly $10 billion and equity of $490 million. Together, Hana Bank and BitGo plan to launch their joint cryptocurrency custody venture in the second half of 2024.

Crypto Biz is your weekly pulse of the business behind blockchain and crypto, delivered directly to your inbox every Thursday.

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

Coinbase launches crypto lending platform for US institutions

Coinbase’s new institutional lending service has the same operating entity as Coinbase Borrow, which halted issuance of new loans in May.

Cryptocurrency exchange Coinbase has rolled out a crypto lending service for institutional investors in the United States, reportedly aiming to capitalize on massive failures in the crypto lending market.

Coinbase has quietly launched an institutional-grade crypto lending platform, Coinbase Prime, to U.S. investors, according to a Bloomberg report on Sept. 5. Coinbase Prime is a full-service prime brokerage platform that lets institutions execute trades and custody assets.

“With this service, institutions can choose to lend digital assets to Coinbase under standardized terms in a product that qualifies for a Regulation D exemption,” the firm reportedly said in the statement.

According to a filing with the U.S. Securities and Exchange Commission, Coinbase customers have already invested $57 million in the lending program since the date of the first sale that occurred on Aug. 28. The offering had attracted five investors as of Sept. 1.

Data from a SEC filing by Coinbase Credit. Source: Coinbase SEC Filings

Coinbase did not immediately respond to Cointelegraph’s request for comment.

The new crypto lending product by Coinbase follows the halt of new loans issuance on Coinbase Borrow in May 2023. The program is designed to allow users to receive up to $1 million through a Bitcoin (BTC) collateral. The new institutional program is operated through Coinbase Credit, the same entity that manages Coinbase Borrow.

Related: SEC vs. Coinbase: New lawyer Patrick Kennedy joins fight

The news comes months after the U.S. SEC charged Coinbase with alleged offering and sale of unregistered securities in connection with its crypto starking services, which allow users to earn yields on giving their crypto to the platform. The exchange opposed the SEC’s allegations, arguing that it strongly disagrees with any allegations that its staking services were securities.

Coinbase eventually had to pause its staking program in four states, including California, New Jersey, South Carolina, and Wisconsin, while the proceedings were going forward.

The crypto lending industry was hit with a massive crisis last year, with major companies like BlockFi, Celsius and Genesis Global going bankrupt amid lack of liquidity caused by the bear market of 2022. Some crypto enthusiasts said that the crypto lending sector must learn lessons from the collapses and solve issues related to short-term assets and short-term liabilities.

Magazine: Magazine: How to protect your crypto in a volatile market — Bitcoin OGs and experts weigh in

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

BlockFi opens crypto withdrawals for eligible US users following court order

The lending platform halted client withdrawals amid filing for bankruptcy in November 2022, but later petitioned the court for authorization to return user funds.

Many customers at defunct crypto lending firm BlockFi have reported being able to withdraw funds for the first time in months following an order from a United States bankruptcy court.

In an Aug. 17 update on X, BlockFi said it had opened withdrawals for wallets of eligible users in the U.S. in accordance with a bankruptcy court order. The lending firm said the withdrawals did not extend to many wallets controlled by international users, but legal proceedings were ongoing.

“As authorized by the Court in the Wallet Order, eligible clients at this time include U.S.-based BlockFi Wallet account holders who [...] did not withdraw or transfer more than $7,575 worth of digital assets from their BlockFi Interest Account (BIA) or BlockFi Private Client (BPC) on or after November 2, 2022 [and] did not hold any trade-only assets in their Wallet at the time of Platform Pause on November 10, 2022, at 8:15 P.M. E.T.,” said BlockFi in its notice to users.

BlockFi was one of many firms that filed for Chapter 11 bankruptcy protection in the United States in 2022, including FTX, Celsius Network, and Voyager Digital. The lending platform halted client withdrawals in November 2022, but filed motions that December to return user funds.

Related: Crypto custodian Prime Trust files for Chapter 11 bankruptcy

A court order filed on Aug. 16 in U.S. Bankruptcy Court for the District of New Jersey gave BlockFi the legal authorization to open withdrawals for the first time in nine months. Many X users have already reported being able to access their funds, but some based outside the U.S. said they still were not eligible.

BlockFi reported on Aug. 2 that the bankruptcy court had conditionally approved its restructuring plan, adding it planned to prioritize recovering funds from firms including Alameda Research, FTX, Three Arrows Capital, Emergent and Core Scientific. The lending firm also faces a $30-million fine from the U.S. Securities and Exchange Commission, which the regulator said in June it would postpone collecting until BlockFi’s users were repaid.

Magazine: ‘Account abstraction’ supercharges Ethereum wallets: Dummies guide

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

CRV exposure risk throws a curveball at the DeFi ecosystem: Finance Redefined

Most DeFi tokens traded in the red on weekly charts due to the chaos caused by the Curve Finance exploit.

Welcome to Finance Redefined, your weekly dose of essential decentralized finance (DeFi) insights — a newsletter crafted to bring you the most significant developments from the past week.

The $47 million Curve Finance exploit on July 30 had a domino effect on the DeFi ecosystem, mainly due to the $100 million loan taken out by the Curve founder against the platform’s native Curve DAO (CRV) token. Several lending protocols have rushed in with new governance proposals to minimize CRV exposure risks as the token price fluctuates. On Aug. 3, the native stablecoin of the ecosystem crvUSD depegged due to market conditions.

Being considered the backbone of the DeFi ecosystem, the Curve exploit could trigger a severe crisis.

The Curve crisis also had a negative impact on the price of the DeFi tokens, with a majority trading in the red on the weekly charts.

Curve Finance pools exploited by over $47 million due to reentrancy vulnerability

Several stable pools on Curve Finance using Vyper were exploited on July 30, with losses reaching over $47 million. According to Vyper, its 0.2.15, 0.2.16 and 0.3.0 versions are vulnerable to malfunctioning reentrancy locks.

“The investigation is ongoing but any project relying on these versions should immediately reach out to us,” Vyper wrote on X (formerly Twitter). Based on an analysis of affected contracts by security firm Ancilia, 136 contracts used Vyper 0.2.15 with reentrant protection, 98 used Vyper 0.2.16 and 226 used Vyper 0.3.0.

Continue reading

CEX price feed prevents Curve price from collapsing amid $100 million vulnerability

The CRV price collapsed on the DeFi market due to the significant draining of several pools; however, it was eventually saved by the centralized exchange price feed. CRV hit $0.086 on decentralized exchanges but traded at $0.60 on centralized exchanges (CEXs), preventing the token’s price from collapsing to zero.

Curve pools use Chainlink’s oracle system, which incorporates several price feeds, including centralized exchanges. If not for the CEX price feed, Curve Finance would have collapsed. This ironic incident drew the attention of Binance CEO Changpeng Zhao, who said that, in the end, it was a CEX price feed that saved the DeFi protocol.

Continue reading

Curve Finance founder’s $100 million debt could trigger a DeFi implosion: Report

While Curve Finance is still weathering the aftermath of its recent $47 million hack, another issue concerning holders of the DeFi protocol’s token has surfaced on the internet, sparking theories about how a massive dump could potentially happen.

On Aug. 1, crypto research firm Delphi Digital published an X thread detailing the loans taken out by Curve Finance founder Michael Egorov that are backed by 47% of the circulating supply of CRV. According to the research firm, Egorov holds around $100 million in loans across various lending protocols backed by 427.5 million CRV.

Continue reading

Curve’s crvUSD depegs as market reacts to shock events

Curve Finance’s native stablecoin, crvUSD, briefly depegged on Aug. 3, reacting to an uncertain environment surrounding the protocol after its recent exploit. On the day, the stablecoin fell by as much as 0.35% before regaining its peg to the United States dollar.

Curve’s crvUSD uses a mechanism for maintaining its peg called the PegKeeper algorithm, which manages the interest rate and liquidation ratio based on the stablecoin supply and demand to maintain its value. In other words, it ensures that the crvUSD value is properly backed by collateral while balancing supply and demand.

Continue reading

DeFi market overview

DeFi’s total market value saw a bearish decline in the past week. Data from Cointelegraph Markets Pro and TradingView shows that DeFi’s top 100 tokens by market capitalization had a bad week, with most tokens trading in the red. The total value locked into DeFi protocols remained below $50 billion.

Thanks for reading our summary of this week’s most impactful DeFi developments. Join us next Friday for more stories, insights and education regarding this dynamically advancing space.

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

Curve founder looks to unexpected counterparties to rescue sinking DeFi loans

Michael Egorov is attempting to pay off his mountain of DeFi debts by selling CRV at a discount.

Curve Finance founder Michael Egorov is attempting to offload some of his DeFi positions to alleviate his mountain of debt, but some have highlighted his liquidity sources.

On Aug. 1, Nansen research analyst Sandra Leow posted a list of liquidity sources for Egorov’s Curve DAO (CRV) positions.

According to Leow, Egorov sold around 50 million CRV tokens over the counter to several buyers at a below-market rate of $0.40 per token. The sale includes a three to six-month vesting agreement or they can be sold should prices reach $0.80.

Some of the bigger players involved include Tron founder Justin Sun, who was recently sued by the United States Securities and Exchange Commission.

Other notable buyers included tech entrepreneur Jeffrey Huang, better known as “MachiBigBrother” who Twitter personality ZachXBT accused of embezzling 22,000 Ether (ETH), currently valued at over $41 million, over several projects. Huang has denied the claims and sued ZachXBT for defamation.

DWF Labs, an investment firm that also engages in market making, also snapped up some discounted tokens.

Others include the DeFi lending protocol Cream Finance, "DCFGod" who is listed as part of a team for a nonfungible token (NFT) project and three other crypto wallets.

Wintermute CEO Evgeny Gaevoy suggested some of the people and entities Egorov is dealing with "are kind of questionable" adding Wintermute hadn't onboarded Egorov as a counterparty.

The Curve founder took out a $100 million DeFi stablecoin loan using his own CRV stash as collateral. However, the protocol was exploited on July 30 resulting in a 30% crash in CRV prices.

As the price of CRV neared the liquidation price, which is $0.362 according to DeFiLlama, fears have mounted of a DeFi black swan event with so much CRV potentially flooding markets with limited liquidity.

However, since some of the debts have been repaid, the token has recovered over the past 24 hours and was trading at $0.597 at the time of writing.

Related: Ethical hacker retrieves $5.4M for Curve Finance amid exploit

Egorov has paid off more than $17 million in stablecoin loans increasing the health of the loan slightly, according to Debank.

However, the DeFi founder still has a mountain of debt to pay with $60 million in stablecoins on Aave, $12 million on Abracadabra and around $8 million on Inverse.

He also has a $9 million loan on Frax, which concerned some onlookers due to its 85% interest rate.

Magazine: Should crypto projects ever negotiate with hackers? Probably

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

Bankrupt Celsius to spend $24M from GK8 sale on legal expenses

After buying GK8 for $115 million in 2021, Celsius is selling it for $25 million, spending 96% of the sale proceeds on legal fees.

Bankrupt cryptocurrency lending firm Celsius has requested the court to grant relief in the motion related to the distribution of funds from its sale of the self-custody platform GK8.

The Celsius Network’s debtors on July 17 submitted a filing stating that its Series B holders have agreed on a settlement to distribute $25 million from the proceeds of GK8’s sale.

The agreement was reached between debtors, the creditors’ committee and the initial consenting Series B preferred holders.

According to the document, the shareholders proposed allocating $24 million for legal expenses and the remaining $1 million to be distributed among the holders.

“In light of the fact that the primary purpose of the settlement is to reduce administrative costs, the debtors agreed to and remain supportive of the proposed allocation, which provides the initial consenting Series B holders with reciprocal benefits,” the filing reads.

According to the court document, the settlement agreement was borne out of the “mutual desire” to avoid costly litigation and a lengthy confirmation process with a corresponding increase in professional fees. The filing notes:

“The settlement not only unlocks tremendous value for the debtors’ creditors but also affords the debtors and all parties priceless certainty of the way forward. For the reasons set forth herein and the motion, the court should overrule the objections and grant the relief requested in the motion.”

As previously reported, Celsius acquired the Israeli self-custody startup GK8 in late 2021 for $115 million. The troubled crypto lender was soon forced to sell GK8 as part of its restructuring plan following Celsius’ collapse in 2022.

Related: Former Celsius CEO Alex Mashinsky reportedly arrested

In late 2022, Mike Novogratz-led investment firm Galaxy Digital won the bidding to buy GK8. As part of the acquisition, Galaxy acquired GK8’s team consisting of 40 experts, including cryptographers and blockchain engineers, alongside an office in Tel Aviv. In July 2023, GK8 hosted a meeting with financial executives in its New York offices.

The news comes as Celsius tackles a series of legal issues in mid-July. On July 13, the United States Securities and Exchange Commission filed a lawsuit against Celsius, which accompanies reports on the arrest of the former CEO Alex Mashinsky. The U.S. Federal Trade Commission also issued a $4.7-billion fine against Celsius the same day.

Mashinsky pleaded not guilty to charges of misleading customers and inflating the CEL token, and was subsequently released on bail of $40 million.

Magazine: Should you ‘orange pill’ children? The case for Bitcoin kids books

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

Everything that’s happened with Celsius and Alex Mashinsky so far

A look back at the rise and fall of Celsius, starting with the firm's growth during the pandemic to the arrest of its former CEO and resolutions with federal regulators.

On July 13, authorities arrested Alex Mashinsky, the former chief executive officer of Celsius Network. He faces criminal and civil charges stemming from his time at the cryptocurrency lending platform, which he helped co-found in 2017.

Though the potential criminal proceedings of Mashinsky and indictment of Celsius are ongoing, the events of this week have been a culmination for many crypto users affected by the collapse of the platform. There were likely issues facing Celsius prior to the crypto market crash of 2022, buthe collapse of Terra put a spotlight on the lending platform’s instability.

Founded in 2017, Celsius Network grew to have more than 1.7 million customers and $25 billion in assets under management at its peak during the global pandemic. However, a crypto market downturn shed light on the firm’s leveraged trading practices and contributed to its downfall.

The price of the Celsius (CEL) token dropped significantly in early 2022 amid stablecoins like Tether (USDT) depegging from the U.S. dollar and the fall of Terra. In June 2022, Celsius announced it would pause all withdrawals to “put Celsius in a better position to honor, over time, its withdrawal obligations,” without providing a definitive timeline.

Celsius filed for Chapter 11 bankruptcy on July 14, 2022, leaving depositors uncertain as to the fate of their assets locked up on the lending platform. Prior to and following the announcement, many U.S. state financial regulators issued warnings to Celsius, with calls ranging from ordering the platform to stop offering securities to alleging Mashinsky made misleading statements.

Mashinsky resigned as CEO in September 2022, saying his role had become an “increasing distraction” amid users facing “difficult financial circumstances”. Reports at the time over the firm’s bankruptcy proceedings suggested Celsius had roughly $2.8 billion in debt.

By the end of 2022, the U.S. Justice Department already had an indictment against Mashinsky, Celsius, and former chief revenue officer Roni Cohen-Pavon for multiple charges related to fraud, but the proceedings remained sealed until July 2023. The Commodity Futures Trading Commission (CFTC), Federal Trade Commission (FTC), and Securities and Exchange Commission (SEC) were likely starting to build their own cases against Celsius for violating regulations under their respective purviews.

Related: Eligible Celsius users can withdraw all ‘Distributable Custody Assets’ following court approval

In January 2023, the New York Attorney General filed a lawsuit against the former CEO for allegedly making numerous “false and misleading statements” leading to investors losing billions. The CFTC and SEC followed in July announcing civil cases against Mashinsky amid the former CEO’s criminal charges, but settlements with the platform itself. The FTC issued $4.7 billion in fines to the lending platform for allegedly “squander[ing] billions in user deposits” after “duping” users.

At the time of publication, Mashinsky has pleaded not guilty to all charges, is free on a $40 million bond and not allowed to travel except under special circumstances. Celsius debtors said they were “pleased” by the resolution of cases with federal regulators as the platform continued with its bankruptcy proceedings.

Mashinsky joins the growing number of individuals in the crypto space targeted by authorities for allegedly defrauding users. Former FTX CEO Sam Bankman-Fried remains free on bail in the U.S. until his first criminal trial in October, and Terra co-founder Do Kwon was sentenced to four months in prison in Montenegro, from where he may be extradited to the U.S. or South Korea to face fraud charges.

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

Magazine: Tiffany Fong flames Celsius, FTX and NY Post: Hall of Flame

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst

3 reasons why Bitcoin’s price is primed to hold the $30,000 level as support

Bitcoin’s price has been showing weakness near the $30,000 level, but multiple data points highlight the fact that bears remain at a disadvantage.

Bitcoin’s price gave back some of its recent gains this week, but multiple data points suggest that $30,000 should hold as support going forward.

Bitcoin (BTC) remained within a narrow 4.3% range for the 15 days leading up to July 7. Despite the proximity of the $29,895 to $31,165 range, investors’ sentiment was significantly impacted by an unsuccessful attempt to break above $31,400 on July 6.

Traders’ tendency to overreact to short-term price movements rather than Bitcoin’s year-to-date gains of 82% could be part of the reason for the short-term correction. This same rationale applies to the events related to other cryptocurrencies.

At the forefront of investors’ minds are questions about whether the recent price gains were solely driven by multiple spot Bitcoin exchange-traded fund (ETF) requests.

Other pressing developments include Binance’s chief strategy officer, Patrick Hillmann, and other top compliance officers reportedly leaving the exchange on July 6 over CEO Changpeng Zhao’s response to the United States Justice Department’s investigation. On June 29, the crypto exchange also informed users that its euro banking payment gateway would cease services by September, potentially halting deposits and withdrawals via SEPA bank transfer.

Meanwhile, the yield curve on interest rates reached its deepest inversion since 1981 on July 3, reflecting the two-year note’s 4.94% yield compared to the 10-year note trading at 3.86%, the opposite of what is expected from longer-term bonds. The phenomenon is closely watched by investors, as it has preceded past recessions.

All of these events are likely having some impact on the Bitcoin price and investor sentiment. Both topics are explored in greater depth below.

Traders show strength in margin, options and futures markets

OKX stablecoin/BTC margin lending ratio. Source: OKX

The OKX margin lending indicator based on the stablecoin/BTC ratio has steadily increased from 20x favoring longs on July 1 to the current 29x ratio on July 7, indicating growing confidence among traders using margin lending. However, it remains within a neutral-to-bullish range, below the historical 30x threshold associated with excessive optimism.

Besides leaving room for further long leverage, the indicator shows no signs of potential stress on margin markets in case of a sudden Bitcoin price correction.

Traders aren’t buying protective puts or increasing their shorts

Traders can also gauge the market’s sentiment by measuring whether more activity is going through call (buy) options or put (sell) options. A 0.70 put-to-call ratio indicates that put option open interest lags the more bullish calls and is, therefore, bullish. In contrast, a 1.40 indicator favors put options, which can be deemed bearish.

BTC options volume put-to-call ratio. Source: Laevitas

The put-to-call ratio for Bitcoin options volume has remained below 1.0 for the past three days, suggesting a higher preference for neutral-to-bullish call options. The important thing here is, despite Bitcoin’s price briefly correcting to $29,750 on July 7, there was not a significant surge in demand for protective put options.

The top traders’ long-to-short net ratio excludes externalities that might have solely impacted the options markets. There are occasional methodological discrepancies between different exchanges, so readers should monitor changes instead of absolute figures.

Exchanges' top traders' long-to-short ratio. Source: CoinGlass

The long-to-short ratio for OKX’s top traders increased from 0.52 on July 3 to 1.68 on July 7, indicating strong demand for leveraged long positions despite Bitcoin’s failure to break above $31,000. At Binance, the indicator declined from 1.52 on July 3 to 1.39 on July 7, remaining above its 1.33 average for the previous 30 days, which suggests a neutral reading.

Related: Bitcoin mining stocks outperform BTC in 2023, but on-chain data points to a potential stall

Bears will have a tough time given the markets’ expectation of a potential ETF approval

Natalie Brunell, an award-winning TV journalist, podcast host and educator in the Bitcoin space, spoke to Cointelegraph on how crypto is now being taken more seriously as an asset class by institutional investors, as evidenced by the multiple Bitcoin ETF filings, including by some of the world’s largest asset fund managers.

Speaking on Fox Business on July 5, Larry Fink, the CEO of BlackRock, also said that Bitcoin’s role was largely “digitizing gold," suggesting U.S. regulators consider how a spot ETF could democratize finance. Fink suggested that investors could turn to Bitcoin as a hedge against inflation or the devaluation of certain currencies.

So, from a bird’s-eye view, for those questioning whether Bitcoin is poised for a correction after a rally fueled by ETF hype, the resilience of traders’ bullish conviction and lack of excessive optimism observed in the BTC margin show they need to relax.

Bitcoin options and futures markets indicate that challenging times are ahead for Bitcoin bears and those expecting a sharp price correction solely due to regulatory and recessionary concerns.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Crypto Whales Load Up $640,500,000 Worth of Dogecoin (DOGE) in Just Two Days, Says Analyst