The much-awaited executive order by Vice President Biden has been hailed as a positive development for cryptocurrency. The Polygon network has been experiencing prolonged outages following the upgrade. All of these stories and more are included in this week’s newsletter.
We begin with a remarkable positive impact on digital assets. President Joe Biden signed an executive order this week aimed at cryptocurrencies, marking a landmark moment in the history of digital currencies, taking bitcoin, Ethereum, and other crypto tokens a step closer to being accepted as legitimate financial instruments by all Americans, and globally. As a result, it was viewed as a positive sign for the development of crypto adaption.
As part of the executive order, Biden directed the Treasury Department and other federal agencies to study the impact of cryptocurrency on financial stability and national security. In addition, the Fed was instructed to explore whether it should create its own digital currency. The finance industry and crypto traders have widely anticipated Mr. Biden’s executive order, along with lawmakers who have compared today’s crypto market to the Wild West. Despite this, the most popular cryptocurrencies, such as bitcoin, Solana, and ripple, declined or remained flat during Friday’s trading activity.
In a statement released Wednesday, the European Union clarified that certain companies and individuals from Russia and Belarus are restricted from trading digital assets in the EU. Updates were part of a notification that the EU had extended its sanctions to Belarus for its participation in the Russian invasion of Ukraine. Following a request from the European Central Bank and the European Union’s treasuries to clarify the EU’s position Wednesday, the Commission released a statement clarifying the position of the EU.
In other news, Polygon’s network is experiencing extended service outages following an upgrade. Polygon network developers informed users on the Polygon project’s forum that there could be downtime beginning at approximately 5:50 pm UTC due to maintenance required on one of the network’s three layers. A recent upgrade may have resulted in an error in the network’s ability to reach consensus.
A Polygon update was issued at 1:30 am UTC explaining that the team was still working to fix the error and that a hotfix had been deployed to allow the process to continue. To the best of our knowledge(as of the time of writing), the hotfix has not yet taken effect. Moreover, the team assured users that all funds and data on the blockchain are secure.
Every day, ALPEX Global provides market wrap — following analyses are based on keeping an eye on the markets and what we anticipate.
Amidst the volatility, the world is moving toward crypto regulations. Cryptocurrency prices have been volatile over the past week. Due to the ongoing tension between Russia and Ukraine, Bitcoin fell to its lowest point of $37,000 on March 7.
When US President Joe Biden signed the executive order on March 9th, Bitcoin reached its highest value of $42,000. Over the past day, it has traded above $39,000 with a dominance of nearly 42 percent.
Meanwhile, Ethereum, the second-largest cryptocurrency, is trading at US$2,500. As a result of inflation caused by the war, the market may fluctuate next week as well.
*Disclaimer* Investment in cryptos carries various risks and is not suitable for all investors. Be sure to do your research thoroughly before making any decisions to invest.
The latest draft proposal for the legislative framework governing cryptocurrencies (MiCA), as presented by the European Parliament, still contains cryptocurrencies provisions that could limit the use of proof-of-work (POW). In this regard, Dr. Stefan Berger, a member of the EU parliament responsible for the legislative framework of MiCA, said that the POW paragraph had been deleted, but the final decision was still pending. The European Parliament will vote on the latest draft of the MiCA on March 14.
Bitcoin transactions exceeding $100,000 account for more than 99% of all bitcoin transactions. Crypto analytics platform IntoTheBlock reports that volume miners are no longer relevant in terms of market impact, but institutions are playing a greater role in cryptocurrencies. Since the third quarter of 2020, institutional dominance and structural changes have increased, and the share of large transactions continues to exceed 90%. The number of bitcoins held by miners has decreased by a significant amount over the past decade. The arithmetic of Bitcoin, however, is near record levels at the same time that the price is declining. There is a possibility that both of these scenarios will put pressure on the margins of miners and that they may be forced to sell assets to cover operating expenses.
This concludes our weekly newsletter. We thank you for reading. We hope it was informative and helpful for you. We look forward to bringing you more news about crypto and blockchain next week.
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