Celsius Made ‘Mysterious’ $300 million Moves after Stopping Withdrawals

Jenson Nunez
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Celsius Made ‘Mysterious’ $300 million Moves after Stopping Withdrawals

Celsius started to freeze withdrawals, exchanges and transfers frozen. The funds got migrated to the FTX exchange.

Celsius, a bitcoin (BTC) and digital assets lending and investment entity, is currently in the middle of a problematic situation after freezing withdrawals from its platform. After the statement’s release, one of its wallets migrated at least USD 320 million in ether (ETH) and wBTC (bitcoin token in Ethereum) without further explanation.

An address verified as owned by Celsius registered constant movements since the early hours of this June 13. There are withdrawals for more than 6,000 wBTC and 50,000 ETH.

Many withdrawals came from funds that Celsius housed on the decentralized lending platform called Aave as part of its collateral currencies, which got sent to the FTX exchange.

The chronology of the event highlight that the withdrawals took effect minutes after the withdrawal freeze became official on the network. The statement got also revealed on Twitter, while the first withdrawal operation executed by WBTC took effect at 6:46 PM UTC, as the Etherscan portal highlighted. After this situation, there have been another six operations in which more than USD 320 million in cryptocurrencies got moved.

 The company did not highlight any official reason for the migration of these funds. The entity just had withdrawn its collateral on Aave and revealed that it intends to keep liquidity afloat on the network during the withdrawal freeze.

The moves to FTX could intend to request a collateralized loan to support its liquidity. Also, the movement’s goal would be to sell the cryptocurrencies housed by Celsius, but there is no official explanation.

Celsius can Cause its own Perdition

Celsius could fall into default due to the little liquidity it currently possesses. Although it was a possible future panorama, the current situation seems to make it a reality, with the blocking of withdrawals and the unexpected migration of its reserves.

The stETH token theoretically should keep 1:1 parity with ETH, but it is also subject to its own variations determined by supply and demand.

Celsius determined that at least 50% of its ETH reserves were in stETH (more than 400 thousand stETH). In a liquidity emergency, with massive withdrawals, Celsius will have to give its stETH positions which would cause the token to lose its parity.

The token would lose its parity in such a way that the procedure currently applied by Celsius to stop withdrawals may get caused by the protection of its reserve capital in this type of asset.

By: Jenson Nuñez

Changpeng Zhao Questions the Investigation by the SEC into Binance

Alexander Salazar
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The US Securities and Exchange Commission (SEC) is investigating cryptocurrency exchange Binance, which its CEO Changpeng Zhao questions.

Reports from the SEC state that Binance is under investigation over the legitimacy of its initial coin offering (ICO). Zhao recently confirmed that information, indicating that the US agency has been in contact with the exchange.

The executive said that the SEC regularly asks them questions about Binance and its products. He explained that they are always in regular contact with the authorities but have not summoned the exchange.

The Department of Justice (DoJ), the Commodity Futures Trading Commission (CFTC), and the Internal Revenue Service (IRS) are also scrutinizing Binance.

Curiously, the CEO of Binance said that he has a bank account but does not use it regularly.

The SEC Investigates Binance for Possible Violations of Securities Regulations

The Securities and Exchange Commission is reviewing the origins of Binance Coin (BNB) for alleged violations of securities regulations.

The investigators are inspecting whether the initial coin offering in 2017 amounted to the sale of a security not registered with the SEC.

Binance stated they consider it inappropriate to comment on their ongoing discussions with regulators. They mentioned that they have talked about education, assistance, and voluntary responses to requests for information.

They said they would continue to comply with the requirements established by the law.

The Exchange Says It Will Continue to Comply with Regulations

A Binance spokesperson stated they had worked diligently to educate and assist law enforcers and regulators. He said they have done it in the United States and abroad as the industry has rapidly grown.

He added that they would continue to comply with the requirements established by regulators while adhering to the new guidelines.

Changpeng Zhao Reflects on the Regulation of the Cryptocurrency Industry

Changpeng Zhao stated that it was necessary to distinguish between good regulation and over-regulation, as the latter would stifle innovation.

He said that it was crucial to classify cryptocurrencies to avoid placing them in a single bucket. He highlighted there are various types of crypto assets with different use cases.

The CEO of Binance also pointed out that governments should establish a new regulator for the industry. Even though he considers there should be regulation, he believes the industry can self-regulate in some areas.

Zhao thinks regulators should take a relaxed approach in some areas to see how the industry grows and develops.

Regulators are becoming increasingly interested in what happens within the cryptocurrency ecosystem. However, they should allow the industry to grow to become part of the world economy.

BNB is trading at around USD 222.29 and has accumulated a 0.5% loss over the last 24 hours. While its daily trading volume is above USD 2.12 billion, its market capitalization is about USD 36.26 billion. It occupies 5th place in the cryptocurrency ranking, according to CoinGecko.

By Alexander Salazar

Ethereum Price Drops Below $1,100 and Data Suggests Bottom is Still Far Away

Audy Castañeda
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Ethereum Price Drops Below $1,100 and Data Suggests Bottom is Still Far Away

ETH price has stalled around the $1,100 level, but various data suggest the altcoin sell-off is far from complete.

Ether (ETH) price plummeted below $1,100 in the early hours of June 14 at prices not seen since January 2021. The move lower marks a 78% correction from the all-time high of USD 4,870 on November 10, 2021.

More importantly, Ether has outperformed Bitcoin (BTC) by 33% between May 10 and June 14, 2022, and the last time a similar event occurred was in mid-2021.

Although Bitcoin oscillated in a tight range two weeks before the 0.082 ETH/BTC peak, this period marked the peak of “DeFi summer” when Ethereum’s Total Value Locked (TVL) catapulted to $93B from $42B two months before.

What’s Behind Ether’s Underperformance in 2021

Before jumping to conclusions, a larger dataset is needed to understand what led to the 31% correction in the ETH/BTC price in 2021. Looking at the number of active addresses is a good place to start.

The data shows steady growth in active addresses, rising from 595,620 in mid-March to 857,520 in mid-May. So not only did the growth of TVL take investors by surprise but also the number of users.

Ether’s 31% underperformance against Bitcoin in June 2021 reflected a cooling-off period after unprecedented growth in the Ethereum ecosystem. The consequence for the price of Ether was devastating and a 56% correction followed that “DeFi summer”.

One must compare recent data to understand if Ether is headed for a similar outcome. In that sense, those who expected the 31% failure against the Bitcoin price bought the altcoin at a cycle low near $1,800 on June 27, 2021, and the price increased by 83% in 50 days.

Is Ether Showing a Buy Signal Right Now?

This time, there is no DeFi Summer and before this year’s 33% negative return against Bitcoin, the active direction indicator was already slightly bearish.

As of May 10, 2022, Ethereum had 563,160 active addresses, in the lowest range in recent months. This is the exact opposite of the mid-2021 move that occurred when Ether price accelerated its losses in BTC terms.

Sentiment in the Ethereum market is currently bearish, with the Fear and Greed Index showing extreme fear. The major support levels are $1,777.97, $1,755.25, and $1,720.61, while $1,835.32, $1,869.96, and $1,892.67 are key resistance levels.

The current forecast for the price of Ethereum is bearish. ETH would need to drop -by 10.87% to reach our target of $1,586.45 in the next five days. Going forward, it will be important to monitor ETH market sentiment, key support and resistance levels, and other indicators. However, we must remember that the cryptocurrency market is unpredictable and even the largest crypto assets show high price volatility.

One would still think that despite a relatively flat number of users, the Ethereum network has been growing by featuring a higher TVL.

The data shows that on May 10, 2022, the Ethereum TVL network had $87 billion in deposits, up from $102 billion the previous month. Thus, there is no correlation between the mid-2021 cool down after “DeFi summer” and the current 33% Ether price drop against BTC.

These metrics show no evidence of similarity between the two periods, but $1,200 could also be a cycle low, and this will depend on factors other than network usage.

Considering how weak active addresses and TVL data were before the recent price correction, investors should be very careful when trying to predict a market bottom.

By Audy Castaneda

Cryptocurrencies Inalienable Option for Savings, Future of Money to Be Digital, According to Venezuelan Economist

Audy Castañeda
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Cryptocurrencies Inalienable Option for Savings, Future of Money to Be Digital, According to Venezuelan Economist

Leonardo Buniak pointed out that financially speaking, the future of money was digital and that cryptocurrencies were an interesting opportunity to consider.

Leonardo Buniak, a Venezuelan economist and risk assessor, spoke with the renowned Venezuelan journalist Roman Lozinski on his radio program about the financial possibilities that Venezuelan citizens had to face inflation and protect their savings in the face of an economy hit hard by slight signs of recovery in some sectors.

Buniak’s View Highlights

First, Buniak pointed out that banking was one of the hardest hit and most affected sectors in the South American nation, and that therefore placing money in savings instruments of Venezuelan banks when interest rates are deeply negative is losing the money because you save in bolivars.

“In Venezuela today we have negative real rates, the interest rate is well below the inflation rate, and in real terms, the negative real interest rate not only does not remunerate savings but also does not preserve the power of savings. In this case, the worst thing I can recommend is that they save in bolivars, whoever saves in bolivars loses dollars and finally loses the bolivars”, detailed the economist.

That said, Buniak also commented “financially speaking” that the future of money was definitely digital and cryptocurrencies will become a “definitely inalienable option for savings because the crypto asset, cryptocurrencies is definitely the future,” he emphasized.

“That does not mean investing in things that are not cryptocurrencies, like the petro. I recommend that in Venezuela… they try to earn money in two ways, mining or betting on the cryptocurrency business, there is definitely an extremely interesting opportunity there,” added Buniak on Lozinski’s radio show.

Likewise, Buniak advised Venezuelans that beyond putting their money in assets that will increase in value with inflation, they should see it more as an act of protecting money rather than of speculating.

It is worth noting that on May 30, Venezuelan Bitcoin (BTC) and cryptocurrency exchange CoinCoinX launched its new Cointerest service, a savings module in the stablecoin Tether (USDT) that allows people to obtain a return for depositing that currency on the platform.

The company launched Cointerest so that, “all Venezuelans have access to large projects in their own country.” They add that the Caribbean nation has a great future in relation to the cryptocurrency industry, claiming that, “We believe in the potential that this industry has for the country. We see how day by day our Venezuelan workers with their knowledge have built innovative systems and structures that no country has in this niche.”

Venezuela: Economic data

In this sense, it should be noted that Venezuela has already come out of its hyperinflationary spiral, and according to the Venezuelan Finance Observatory (OVF), an independent entity made up of economic experts, inflation in Venezuela accelerated and reached 10.1 % in May, which represented an increase of 6.5% compared to April. Regarding year-on-year inflation (May 2021-May 2022), according to the same entity, this was 151%, being the accumulated rate this year 34.3%.

On the other hand, the growth projections -which vary-, show the International Monetary Fund a projection for a growth of 1.5%, the Credit Suisse bank has estimated the increase in Venezuelan GDP for this year at 20%, and the other Venezuelan economist, Asdrúbal Oliveros, who has said that he foresees a growth in the GDP of 8%.

By Audy Castaneda

Investors Should Not Wait for Absolute Bottoms but Seize the Opportunity to Buy Bitcoin

Alexander Salazar
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Strong bearish momentum close to support at USD 23,500 is underway, but there might be a respite in the short term. The price is around relevant support but might drop further before visiting the 200-week SMA.

The price of Bitcoin (BTC) continues to drop as uncertainty and fear spread in the overall markets. The current weekly forecast might seem slightly bearish for those hoping for quick gains. However, others could view it as a generational opportunity to accumulate wealth.

Bitcoin is trading at around USD 22,544 and has accumulated a USD 28.1% loss over the last week. While its daily trading volume is above USD 54,12 billion, its market capitalization is about 428,69 billion, according to CoinGecko.

The new wave of sales occurs amid a sharp collapse in the stock market, as the fear sentiment injects the weakness of the macroeconomic environment.

The US Consumer Price Index reached a 40-year high, indicating that inflation had a year-on-year increase to 8.6%.

The Weekly Forecast of the Price of Bitcoin

This time the price of BTC continues to search for the bottom, with a lot of volatility. It does not seem a good idea to wait for the lowest price to enter despite the possibility of further sales.

Analyst PlanB believes that retailers are not buying due to greed and fear as the price hovered around USD 60,000. The cryptocurrency analyst says investors should not expect it to reach absolute bottoms and focus on a strategy.

The daily chart suggests considerable bearish momentum close to support at USD 23,500. There might be a respite soon before investors expect further sales.

There could be further declines if the price did not reach increasingly high lows on the daily chart.

However, the selling space may be running out, as the current correction from the all-time high is significant.

The macro-environment has never been better for the pioneering cryptocurrency, which remains scarcer and safer. In contrast, the global economy is getting weaker year after year.

The Price is Close to the 200-Week SMA

Will Clemente is another cryptocurrency analyst who agrees this is an excellent opportunity to buy fear. He sees it as a chance for multi-generational success.

Clemente says the price is close to the 200-week simple moving average (SMA). That indicator has frequently worked as support while searching for bottoms in bearish markets.

According to the weekly chart, the price is approaching relevant support, but there might be further drops to visit the 200-week SMA. If it broke through those supports, the ground would be clear for the low of around USD 19,000, which is very unlikely.

Bitcoin plays a significant role in the economy, which many cryptocurrency analysts do not overlook. Despite the decline in its price, the crypto asset has proved to be able to recover from its worst crises. It is only a matter of time before it resumes and exceeds its previous all-time highs.

By Alexander Salazar

Specialists Give this Advice before the Bitcoin Price Drops below USD 23,000

Alexander Salazar
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Specialists Give this Advice before the Bitcoin Price Drops below USD 23,000

Amid the current market fall, specialists recommend maintaining a personal trading strategy to avoid the negative effect of emotions. Enthusiasts express their long-term bullish position, advising investors to follow the fear in the market before making decisions.

The sharp drop in the Bitcoin (BTC) price below USD 25,500, its low in 18 months, has fueled fear in the market. Various specialists have expressed their position on Twitter amid the possibility of investors getting rid of their holdings.

Bitcoiner David Battaglia recently advised BTC investors never to make decisions in a panic, saying they must capitalize on the fear of others. Likewise, trader adrig_iv estimated that remaining firm and objective in hard times would make them good investors.

In that regard, investors need to anticipate sharp price drops for their risk plan. Since those situations will not take them by surprise, they can act according to their original trading strategy. That will allow them to avoid the negative effect of emotions or thoughtless decisions.

The Price of Bitcoin Close to USD 20,000 Is also an Opportunity

Investors with a long-term bullish conviction made more comments on social media as fear increased in the market. For example, the specialist Jess_btc reported that those who think in the short term see it as a tragedy. On the contrary, she stated that those who see Bitcoin as a long-term store of value view it as an opportunity.

She anticipates the current bearish market is an excellent buying opportunity at low prices for long-term holders. In other words, those who store the cryptocurrency as a store of value can speculate that its price will increase over time. ManiThawani is among those who think that this is the best time for investing in BTC.

In contrast, those traders who want to make quick profits temporarily move away from the market until its bullish trend returns. The Mexican trader Oscar Ortega follows this strategy, stating that he will not buy Bitcoin during the crypto winter (bearish trend).

Enthusiasts Remain Bullish amid the Bitcoin Crash

Jess_btc pointed out that those drops are good in the long term as they serve to clean the market. Those who entered to become rich quickly will leave, while those who entered for technological advancement will stay. Those who know the world needs Bitcoin will continue to invest until the end.

Mauricio Di Bartolomeo, the co-founder of Ledn, thinks that the adoption of Bitcoin is on the rise regardless of the price. He argues that the cryptocurrency is solving problems in different countries thanks to its fundamentals and economic restrictions.

He predicts that the bearish market will end when the United States stops raising interest rates, a factor leading to its current fall. He thus maintains his long-term bullish vision, saying that adoption is on the rise despite the price drop.

Concerning the growing adoption he expects for BTC, David Battaglia stated that the macro environment has never been better for Bitcoin. He said that a study by Deloitte and PayPal validates that optimistic outlook amid the bearish market. Those companies estimate that 75% of surveyed US merchants will accept cryptocurrencies as a payment method in the coming months.

It is best to follow a pre-established risk plan amid a sea of short-term bearish thoughts and some long-term bullish ones. Investors will thus avoid selling for fear of a worse low or buying for fear of missing out (FOMO).

By Alexander Salazar

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