Terraform Labs and Do Kwon Reach SEC Settlement, Mastercard Debuts Crypto Credential
Market Update
April PCE data mostly met expectations with a slightly cool reading in Core MoM data (0.2% vs. 0.3% exp.), causing rates to roll over. The US10Y has declined 1.02% to 4.51%, and the DXY has decreased 0.20%. Despite rates and the dollar rolling over, risk assets are selling off in the last trading day of the month. The SPY -0.75% has fallen to $520 and the QQQ -0.38% has dropped to $444. BTC -0.76% is trading in the high $66,000s, while ETH -0.03% is roughly flat on the day, showing some relative strength amid excitement surrounding the ETF launch. Reports yesterday stated that the SEC asked issuers to submit S-1 amendments by the end of day today. Multiple issuers have already submitted amendments, showing that both parties are moving quickly to launch the new product. It is expected that there will be another round or two of comments and amendments before they are declared effective.
Terraform Labs and Do Kwon Reach Settlement With SEC
Terraform Labs and founder Do Kown have reached a tentative settlement with the SEC surrounding fraud charges contributing to the collapse of Luna and UST in 2022. The SEC accused Do Kwon of misleading investors about the stability of its algorithmic stablecoin, which led to the loss of over $40 billion in value for investors. Terraform Labs and Kwon were found guilty of civil fraud charges in April, after which the SEC sought a $5.3 billion penalty to settle the case, along with banning Kwon from dealing in crypto assets. The settlement was announced yesterday without disclosing the terms or details. The Judge asked both parties to submit settlement paperwork by June 12th. Do Kwon is currently on bail in Montenegro, expecting extradition to the U.S. or South Korea as he faces criminal charges in both countries. Following the news, the LUNA token surged upwards of 38% before quickly retracing about half the move.
Mastercard Debuts Crypto Credential Product
Payments giant Mastercard has gone live with Crypto Credential, its peer-to-peer blockchain payments network. Crypto Credential completed its first pilot transactions, allowing users to transfer digital assets using their Crypto Credential “alias” instead of the typical long blockchain address. Crypto Credential assures that a user has met verification standards and that the recipient’s wallet supports the transferred asset, removing the complexity of worrying about sending the right asset across the proper chain. If the recipient’s wallet does not support an asset, Mastercard will notify the sender and not allow the transaction to proceed, protecting users from potential loss of funds. Crypto Credential is enabled on the Bit2Me, Lirium, and Mercado Bitcoin exchanges, enabling cross-border payments within the LATAM and European regions. Traditional payment players like Mastercard and Visa continue to dive into the digital asset space, recognizing the additional utility blockchains and digital currencies they can bring to the sector.
Technical Strategy
Despite the consolidation that’s gripped the Crypto market in recent weeks, not dissimilar from Equities, Bitcoin’s consolidation is now reaching an attractive area of support which likely represents a good risk/reward for BTC -0.76% . Technically speaking the area at $65.5k -$66k lines up with the ongoing uptrend for BTC from early May lows, along with representing former swing high peaks from 5/6, both of which are important technical levels to cushion the short-term decline. Daily BTC chart shows the mild ABC consolidation pattern that started on 5/20 but has done little to no real damage to the current trend. Unless BTC undercuts $64k, this pullback should be buyable for a push back to new all-time highs in June. Any evidence of TNX breaking 4.50% next week should serve as a technical catalyst for Bitcoin to bottom and start to turn higher. Key resistance lies near $72k, but when broken, it’s likely that BTC begins its ascent up to the mid-$80’s into mid-to-late June.
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All metrics as of 2024-05-31 16:19:52 All Funding rates are in bps Crypto Prices
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