BTC is currently trading around $38,400 and ETH around $2,800. Stablecoins are the best performing crypto assets over the last 24 hours. The global crypto market cap is $1.9T, down 10.3% over the last day. DeFi Total Value Locked is ~$216b and BTC dominance is around 41%.
Bitcoin bled overnight and fell as low as $37,885 a bit over an hour ago. With seemingly no single major catalyst, many are pointing to falling risk asset prices and particularly poor tech stock performance to start the year and over the last day with NFLX down 21% premarket. Others have pinned it on continued concerns around monetary policy accommodation removal, a downside break below $40,000, and rumors that Raoul Pal has sold all but one of his bitcoin. In sum, over $900m in total liquidations have occurred over the last 24 hours.
Elsewhere, the Federal Reserve released its highly anticipated discussion paper on a potential US CBDC yesterday. Though the paper stated it “does not favor any policy outcome,” it did review the pros and cons of issuing a CBDC. The Fed concluded that a CBDC could provide a safe digital payment option for households and businesses as the payments system continues to evolve and may result in faster payment options between countries, but that it would also introduce risks, such as those around monetary and financial stability. The Fed has now opened up a 120 day comment period with questions for the public around benefits, risks, design, and policy considerations.
Also yesterday, the US congress heard testimony on crypto mining, where witnesses presented and members of congress debated topics like the renewables usage and less energy-intensive consensus mechanisms. The hearing was generally characterized as moderate, with seemingly little political momentum behind a proper crackdown. It remains unclear how congress plans to follow up on the hearing.
Other notable news includes: Robinhood has launched a beta version of its crypto wallet, and Twitter is rolling out iOS support for NFTs starting with paid Twitter Blue subscribers.
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