Market Wrap: Cryptoassets Dip Slightly, Equities Rise After Fed Minutes

Major equities and cryptoassets stayed mostly flat Wednesday — despite the Federal Reserve indicating additional rate rises are likely on the horizon.

Bitcoin traded in a relatively narrow band after dropping to around $19,800 overnight. Both BTC and ether chugged higher throughout the US stock-trading day, but both ended in the red Wednesday with bitcoin down by 1.44% at the close of stock-trading. Ether dipped .7% to $1,150 over the same period. 

The day started with cryptocurrency company Voyager filing for bankruptcy. An estimated $1 billion to $10 billion worth of cryptocurrencies is now stuck in limbo. The move came just a few days after the crypto lender suspended trading and withdrawals. Digital assets-focused hedge fund firm Three Arrows Capital (3AC) — which owes Voyager $650 million — previously filed for Chapter 15. 

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Traders had been closely watching for today’s minutes from the Fed’s June 14-15 meeting. As futures markets have largely priced in, policymakers agreed that rates may need to increase by either 50 or 75 basis points this month. 

“Many participants judged that a significant risk now facing the committee was that elevated inflation could become entrenched if the public began to question the resolve of the committee to adjust the stance of policy as warranted,” the minutes said. 

Betting markets have priced about a 93% chance of a 75 basis point hike and about a 7% chance of a 50 basis point rise this month, according to CME Group data. 

Major US stock markets were unmoved: The Dow Jones was up 0.23% by close while the S&P 500 was up 0.36%. The Nasdaq increased 0.35%. 

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Tuesday marked the long-awaited drop in the cost of crude oil. The ICE Brent Crude futures contract for September delivery fell 2.31% to $100.40. Jeffrey Halley, senior market analyst at OANDA, wrote in a note Wednesday the price action overnight “hints more at panic and forced liquidation, than a structural change in the tight supply/demand situation globally.”

It’s worth noting some of the decentralized finance (DeFi) platforms that provide crypto lending and borrowing services have weathered the turbulence well. Aave was up 2.93%, while Maker has seen a 4.52% increase in the past 24 hours.

Top Stories

Celsius Reorganizes Board of Directors Amid Liquidity Issues

• Finance executives David Barse and Alan Jeffrey Carr were appointed as new directors at Celsius Network June 28 and June 29, respectively.
• The crypto lending firm also dismissed Gilbert Nathan, John Stephen Dubel and Laurence Anthony Tosi as directors at the end of June.
• Celsius said it was working to stabilize liquidity and operations following its pause of withdrawals and transfers on its platform.

NFT Markets Experienced a Roller Coaster Month During June

• The largest NFT marketplace, OpenSea, traded $646.6 million in volume in June, down more than 65% from the previous month, while Solana NFT (non-fungible token) marketplace Magic Eden registered nearly $111 million in trading volume, down 63.5% over the same period.
• The entire NFT market capitalization went from $35.6 billion to $22.3 billion during the second quarter. With the number of traders going down 14%, the number of NFT holders has been steadily increasing.
• “The reduction in the price of ETH has removed trading barriers for many traders,” Boris Rebo, DappRadar research analyst, told Blockworks.

CoinShares Gets Regulatory Nod To Acquire Napoleon Asset Management

• CoinShares said Monday it had wrapped up its acquisition of EU-regulated crypto company Napoleon Asset Management, furthering its ambitions to market its products and services across the region. 
• The deal has been in the consultation process since CoinShares entered into a sale and purchase agreement to acquire the entirety of Napoleon and its subsidiaries for $14.5 million last November.
• “After the recent events in the digital asset sector, it has never been more clear that strong regulation is needed for crypto to thrive,” CoinShares’ CEO Jean-Marie Mognetti said in the statement, referencing recent market turmoil spurred on by crypto lender bankruptcy filings and sector-related layoffs.

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