First Mover Asia: Signs Point Upward for Crypto in India and South Korea; Bitcoin and Ether Soar on US Executive Order
By Amitoj Singh, Damanick Dantes, James Rubin
India’s finance minister says the country will launch a central bank digital currency sooner than she’d previously indicated; cryptos rise as investors view the Biden administration’s executive order as a positive development.
Prices: Bitcoin, ether and other major cryptos spiked following U.S. President Joe Biden’s executive order.
Insights: The signs for crypto in India, South Korea and other parts of the world pointed upward on Wednesday
Bitcoin (BTC): $42,020 +3.2%
Ether (ETH): $2,729 +1.6%
|Stellar||XLM||+9.3%||Smart Contract Platform|
Prices Rise After Executive Order
After near five days of bad news and sagging prices, crypto hit a gusher on Wednesday.
For once the drumbeat of horror stories from Ukraine, ongoing angst about inflation and energy supplies, and uncertainty about crypto regulation evaporated with the release of U.S. President Joe Biden’s executive order on cryptocurrency. The document provided few specifics but allayed many investors’ fears the administration would adopt a ham-fisted approach, hindering innovation and discouraging consumers and financial institutions from diving deeper into the market. Those groups, particularly the institutions, fueled the massive increase in bitcoin, ether and other major cryptos last year.
Instead, the order acknowledged crypto’s importance and instructed agencies responsible for regulation to coordinate their efforts. Investors saw this approach as a positive.
“The market hates uncertainty,” John Sarson, CEO and founder of Sarson Funds, a provider of blockchain and crypto investment products and services, told CoinDesk TV’s “First Mover” program. He added: “We’ve been saying for some time this executive order would be a springboard for a rally in the crypto market, and that’s exactly what we’re seeing.
Recently, bitcoin, the largest cryptocurrency by market capitalization, was trading at around $42,000, up about 3% over the past 24 hours. Ether, the second-largest crypto by market cap, was changing hands at about $2,700, a roughly 1.5% gain over the same period. Both bitcoin were up even higher earlier on Wednesday All other cryptos in the CoinDesk top 20 by market cap were in the green, most of them significantly.
In a CoinDesk op-ed Kristin Smith, the executive director of the Blockchain Association, the powerhouse, Washington, D.C., trade group, called the Biden order “a major milestone for the industry in the United States.”
“If you are bullish on the long-term possibilities for cryptocurrencies to transform many of the foundational services of our lives, then this recognition by the federal government of crypto’s fundamental importance can only be viewed as an affirmation of that position,” Smith wrote.
Wednesday’s price increases dovetailed with the performance of equity markets that have been battered lately as Russia escalated its unprovoked attack on Ukraine and the U.S. and other countries that condemned the invasion responded with severe sanctions. Sarson noted bitcoin is now functioning both as “a safe haven and risk-on asset, which is where we can really start to see new all-time highs made for the asset category.”
S&P 500: 4,277 +2.5%
DJIA: 33,286 +2%
Nasdaq: 13,255 +3.5%
Crypto Regulatory Signs Also Point Upward in India and South Korea
Wednesday was a good day for crypto in parts of Asia, as well as the U.S. and Dubai.
Prices soared on the Biden Administration’s release of a crypto executive order that recognized the importance of crypto and mapped some reasonable next steps for regulating the rapidly growing industry. U.S. investors and beyond expecting a more stringent approach were relieved.
But the news was far from the only boost on the regulatory and political front for cryptos. South Korea elected a new president in an election that was marked partly by the two main candidates’ efforts to woo younger voters by promising crypto friendly policies. India’s finance minister said that the nation’s central bank would launch a central bank digital currency sooner than previously indicated. In the Middle East, where a number of countries have accelerated their efforts to cultivate blockchain projects, Dubai’s ruler tweeted about the adoption of a crypto law.
In a close election, South Korea picked the conservative People Power Party candidate Yoon Seok-youl as president. In an effort to connect with younger, tech-savvy voters, both Seok-youl and his opponent, Lee Jae-myung of the governing Democratic Party promised to promote crypto friendly policies during their campaigns.
Yoon Seok-youl pledged to raise the threshold for a crypto capital gains tax to be the same as equities, taking it from the current 20% tax which kicks in at KRW 2.5 million (US$2,024) to KRW 52.4 million ($42,450). He also promised something similar to Lee, which was to “take legal measures to confiscate crypto profits gained through illegitimate means and return them to the victims.”
Jae-myung said he would use security token offerings as a way to issue tokenized securities to return ill-earned profits from real estate speculation to the people, to establish a monitoring agency and to bring back initial coin offerings (ICO), which the nation banned in 2017.
India Finance Minister Nirmala Sitharaman said that she expected the nation’s central bank to launch a central bank digital currency (CBDC) or digital rupee “this year,” veering from her earlier statement that it would launch some time between 2022 and 2023. The announcement ratcheted up the competition with China in which will be the first country to make a CBDC a staple of their monetary system. China, the world’s most populated nation, is increasingly embracing blockchain and the metaverse, even recently holding a metaverse job fair.
Sheikh Mohammed bin Rashid Al Maktoum, Dubai’s ruler, addressed uncertainty and concerns in his country about crypto when he tweeted about the adoption of a crypto law and the establishment of an independent authority for oversight.
Al Maktoum said that Dubai hopes to create the “best business environment in the world for virtual assets” and coincides with its hosting Dubai Blockchain Week and several crypto or metaverse related events throughout the month.
According to the South China Morning Post, the state-backed Shanghai Data Exchange has launched what it describes as a metaverse-based recruitment program in which job seekers “enter the metaverse and adopt the avatar of an animated man in a black suit and then meet recruiters who represent nine departments. Controversially, job seekers cannot interact with human recruiters while in the metaverse and the gender of the avatar, a man, cannot be changed.
Bitcoin Enters Resistance Zone Between $40K-$45K
Bitcoin four-hour chart shows support/resistance with RSI on bottom (Damanick Dantes/CoinDesk, TradingView)
Bitcoin (BTC) rallied as much as 10% over the past 24 hours as buyers reacted to short-term oversold readings.
Resistance, or the pointwhere an uptrend is expected to pause temporarily due to a concentration of supply, at around the $40,000-$45,000 price zone could stall the current upswing, similar to what occurred last week.
The relative strength index (RSI) on the four-hour chart is oversold, which typically precedes a brief pullback in price. On the daily chart, however, the RSI is neutral, suggesting that lower support around $37,000-$40,000 could stabilize pullbacks into the Asia trading day.
For now, bitcoin remains in a tight trading range, although downside momentum has slowed over the past two months. That means bulls could remain active at short-term support levels.
BTC was recently trading near $42,000 at press time and is down 3% over the past week.
Start investing In cryptocurrency with Bitxchange www.bit-xchange.org. If you’re new to the world of crypto and figuring out how to buy cryptocurrencies, then cryptocurrency exchanges like Bitxchange can help you to easily buy and sell crypto.