The Crypto
market is drifting along calmly as Bitcoin is hovering around $19,000 per coin.
Altcoins are following without any significant signs of activity. The same description
of drifting along could be applied to traditional financial markets that remain
under pressure. Investors have gotten tired of being afraid and are inspired by
any minor positive news.
The Federal
Reserve (Fed) interest rates are expected to be raised by 75 basis points in
November and 50 bp in December 2022. These jumbo hikes are now treated as a
positive sign of a possible slowdown of monetary tightening by the American
monetary watchdog. But even as this is the case, the Fed is unlikely to perform a U-turn as
inflation must slow down from 8.2% to 4.4% at least for tactics to change. A
poor performance of consumer prices was the outcome of the Fed’s anti-inflation
measures. So, several months would need to pass until inflation can be brought
down to this level.
Crypto
assets which, along with stocks, are high-risk assets are reacting in a similar
manner to the stock market. U.S. stock indexes are in rebound amid the Fed’s possible
tightening monetary strategy review that could be put into motion at the start
of a possible recession. But the Fed has said several times that it is
literally ready to sacrifice economic growth in order to bring inflation under
control. The same inflation troubles are spotted across the globe and prices
are rising dramatically in Europe. So, the demand for safe haven assets is
expected to last for a long time.
Bitcoin
prices are charting a downside wedge with the upper margin at $69,000 (a peak
of 2021), down to $48,000 and $19,000. The lower margin is at $32,800 down to
17,600. For the moment a bullish trap has emerged, where prices are spiking
above the upper margin and cryptoenthusiasts are doomed to lose their money because
they are not able to defend important support levels. If prices go below
$18,000, Bitcoin may accelerate down with the final target at $4,000. This is a
long-term target and goes beyond the current crypto winter season.
Nevertheless, Bitcoin may lose half of the current values quickly if the
risk-off mode in the market continues to direct investors.
Apple has
introduced new rules on cryptocurrencies and Non-fungible tokens (NFT). It
seems that the tech giant is willing to monopolise the NFT market. According to
new Apple regulations the app can only be offered in countries or regions where
it is licensed and where It has permission to operate a crypto exchange. The guidelines say that apps may use in-app
purchases to sell NFTs and sell services related to them but any sort of
trading service for NFTs must use Apple’s in-app payment mechanism. Apple takes
an up to 30% cut of in-app payments. Any third-party payment solutions,
including redirecting to such solutions, are prohibited. NFT’s acquired from third-party
ecosystems cannot enjoy the same privileged regime as the App Store tokens.
New
regulations are severely limiting decentralised protocols, such as OpenSea and
Moonpay, as they cannot fairly compete with such giants as Apple. Developers
are likely to find ways in which other apps can communicate with the Apple
ecosystem and thing could be better than they are right now. Crypto exchanges
are the major beneficiaries of the new regulation as they have received clear
guidance not to cooperate with the App Store.