Crypto Monday: Weekly market prep
1. Upcoming US presidential election’s impact on Bitcoin’s trajectory
Bitfinex and J.P. Morgan noted a correlation between US presidential candidate Donald Trump's election odds and Bitcoin's price trajectory.
Bitfinex's report details how geopolitical uncertainty and macroeconomic factors intensified BTC volatility, with a notable 6.2% pullback last week, followed by a rebound. This movement underscores the growing impact of the US presidential election on short-term price fluctuations. J.P. Morgan analysts have suggested that a Trump victory would further boost Bitcoin, capitalizing on what they describe as a "devaluation trade" among retail investors.
However, Temasek's CIO Rohit Sipahimalani has said that a Trump win could slow global economic growth.
2. Hong Kong accelerates crypto licensing and plans stablecoin regulation
The Hong Kong Securities and Futures Commission (SFC) is setting up a virtual asset trading platform advisory group to launch in early 2025. This move, possibly inspired by recent stringent regulations in Singapore, is part of Hong Kong's broader strategy to embrace cryptocurrency. This strategy includes establishing advisory groups, introducing AI policy guidelines in finance, extending tax incentives for virtual assets, and collaborating internationally on cross-border tokenized transactions.
The SFC is accelerating the licensing process for virtual asset trading platforms, with 14 pending approvals, and aims to regulate stablecoin products by the end of the year.
3. FTX sues KuCoin to recover $50 million in locked assets from Alameda Research account
FTX has filed a lawsuit to recover over $50 million in assets allegedly retained by KuCoin. These assets were in an account of the now-defunct Alameda Research at KuCoin, which declared bankruptcy in November 2022. FTX claims KuCoin locked access to these assets shortly after bankruptcy proceedings began, with the account holding assets initially worth about $30 million, which has since appreciated to over $50 million. If recovered, these assets could be used to partially repay FTX's debts, potentially impacting the market.
4. Optimism Foundation grants Kraken 25 million OP tokens to enhance DeFi services
The Optimism Foundation has agreed to grant Kraken 25 million OP tokens, a deal finalized early this year. This will pave the way for Kraken to use Optimism's OP Stack. Initially valued at $100 million, these tokens are now worth about $42.5 million.
Following this, Kraken announced plans on October 25 to build a second-layer network, Ink, atop the OP Stack framework to support DeFi transactions, lending, and staking services, similar to Coinbase's Base.
5. South Korea to convene first virtual asset committee meeting to discuss advanced crypto legislation
South Korea's Virtual Asset Committee is set to hold its inaugural meeting on November 6 to review and advise on the "Second Phase of Virtual Asset Legislation," focusing on the legalization of corporate virtual asset accounts and self-regulatory organizations.
Additionally, the Financial Supervisory Service (FSS) plans to enhance its cryptocurrency monitoring systems under the Virtual Asset User Protection Law, establishing its standards for identifying suspicious transactions and monitoring sudden price changes and volume spikes.
6. Japan's crypto industry to implement self-regulation for stablecoins
Japan's largest crypto exchanges and blockchain company alliance, the Japan Virtual Currency Exchange Association (JVCEA), will begin "self-regulating" stablecoins. This move comes as governments worldwide show increasing interest in stablecoin oversight. The JVCEA, which already regulates Japan's crypto exchange industry and handles issues like token listing protocols, has been formally recognized by Japan's top financial regulator, the Financial Services Agency (FSA).
Meanwhile, Brazil's Central Bank is exploring taxing remittances based on stablecoins, with potential inclusion in next year's final cryptocurrency regulations. Legislator Qiu Dageng from Hong Kong also mentioned at an event for the Hong Kong Compliance Association that exploring the issuance of a Hong Kong stablecoin pegged to the Chinese yuan is a worthy direction.
Disclaimer
The development and market cap of stablecoins mentioned in the above content is speculative and based on market analysis at the time of writing and should not be interpreted as guaranteed outcomes. Market conditions can fluctuate widely and unpredictably due to numerous factors such as regulatory changes, market demand, and global economic developments.
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