Volatility Returned To Crypto Markets, Regulatory Tightening Continues

Bitcoin jumped past US$25k for the first time since August, but retreated to mid-US$23k with increased volatility.
Volatility Returned To Crypto Markets, Regulatory Tightening Continues

February 17, 2023 - Volatility has definitely returned to crypto markets with Bitcoin prices jumping past US$25k for the first time since August, but retreated to mid-US$23k right after that. It is not clear what specifically triggered the movement, but some market participants attributed it to improved bullish sentiment, which faced a strong resistance at US$25k. Other analysts were pointing to a spike in the US producer price index released yesterday, but this doesn’t seem to make much sense after the market response to January inflation release, which came above-than-expected, although it decelerated month-on-month, in our view.

The US regulators’ movement against the crypto industry continues at full throttle, with the SEC charging Do Kwon and Terraform Labs on fraud allegations. No one is questioning the former founder of the TerraLuna protocol wrongdoings, but crypto lawyers argue that is concerning that the SEC characterizes the algorithmic stablecoin TerraUSD Classic (USTC) as a security, giving room to frame nearly anything as a security. Meanwhile, Binance’s Chief Strategy Officer (CSO) Patrick Hillmann told the Wall Street Journal in an interview that the exchange had “gaps” in regulatory compliance in the first few years after its launch in 2017. As we have been mentioning, regulation will only increase and missteps from the past may haunt market participants that were not much diligent in the past. At, we have governance and compliance with regulation as some of our core values.

Binance is also facing accusations of secretly transferring more than US$400mn from Binance US to accounts controlled by CEO Changpeng Zhao. This also could involve Silvergate Bank, which was hit by the FTX collapse last year, given that the bank operated some of the transferring. This is concerning given Binance’s relevance in the market, in our view. Moreover, this could not happen at as we keep all funds segregated at our custodian partner Fireblocks under an insurance policy.

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We are a global cryptoassets exchange. We became the first business worldwide to use NASDAQ’s technology to offer cryptocurrencies trading. We are also the first exchange not charging trading fees, keeping our clients assets with Fireblocks, the main institutional cryptoassets storage company in the world, and also having insurance for those assets.
Therefore, we built a governance level in the crypto market only compared with that of traditional financial institutions.