Bitcoin Weekly News 9/5/2023
Bitcoin’s price pumped following Grayscale’s news on Tuesday last week. But all that excitement was absorbed by extreme selling pressure on Thursday. So, Bitcoin has again reached the tight range it established after the drop. The price is again trading between $25,300 to $26,200 range.
Key Takeaways: –
- South Korea’s Hana Bank collaborates with BitGo for digital asset custody services.
- Arthur Hayes explores the relationship between interest rate hikes and Bitcoin.
- Japanese regulators propose changes to ‘Unrealized Gains’ tax for crypto assets.
- El Salvador plans to introduce Bitcoin education in public schools by 2024.
- Former SEC Chairman Jay Clayton believes a Bitcoin ETF approval is inevitable.
The Arrival of South Korean Hana Bank in the Crypto Custody Business
KEB Hana Bank is introducing digital asset custody services in South Korea in collaboration with BitGo. The bank will combine its financial services with BitGo’s custody solutions to provide an effective service to the customers. This partnership is aimed at enhancing consumer protection while establishing trust in the domestic digital asset market.
This joint venture is expected to be launched in the second half of 2024. Hana Bank is also working on introducing an alternative to private stablecoins in the form of tokenized deposit technology.
Bitcoin Price Update by Arthur Hayes
Arthur Hayes has highlighted the relationship between interest rate hikes and Bitcoin during Korea Blockchain Week. Although most analysts are predicting a recession, Bitcoin’s price has doubled since the beginning of the year. Similarly, the tech stocks like Nvidia have shown outstanding growth.
Hayes argues that cryptocurrencies are a favorable option for those who want to mitigate the negative effects of interest rate hikes. Hayes has also discussed the resilience of AI companies in a follow-up interview while predicting a potential default in the global government bond market.
He further added that the crossover between cryptocurrency and AI will potentially benefit Filecoin. However, he has also warned that some AI-based companies might not offer immediate returns for investors.
Japanese Regulator is Making Changes to ‘Unrealized Gains’ Tax
Japanese companies are currently bound to pay tax on their unrealized gains on an annual basis. Japanese Financial Services Agency (FSA) has now proposed to change this practice. Domestic companies will no longer have to pay taxes on unrealized gains unless they’ve converted their crypto assets into fiat currency.
The Ministry of Economy, Trade and Industry has also supported this amendment. FSA has proposed these changes to support the blockchain technology startups in the country.
El Salvador is Planning to Introduce Bitcoin Education in Schools
El Salvador is going to add Bitcoin education to its public school curriculum by 2024 in collaboration with ‘Mi Primer Bitcoin (MPB)’. Ministry of Education is also working with Bitcoin Beach to make this initiative successful. The students will receive a diploma after completing the program.
Bitcoin Beach is going to teach the foundational knowledge of Bitcoin to 150 teachers from 75 schools starting on September 7. These teachers will be responsible for teaching these fundamentals in their respective schools after completing the training. Ministry of Education has planned to expand this program throughout the country if the first project is successful.
John Dennehy, the founder of MPB, has appreciated this step saying that El Salvador is going to set an example for the world with this bold step. El Salvador authorities have already taught more than 25,000 students about Bitcoin through Bitcoin Beach.
Mi Primer Bitcoin is also in talks with two other Latin American governments to implement a similar program because the organization is dedicated to educating the world about Bitcoin.
Connection Between Bitcoin and Oil
Some analysts think that Bitcoin’s price is directly influenced by the prices of oil because the increased prices of oil can lead to higher interest rates while further expanding inflation. It ultimately drives the capital away from Bitcoin into interest-bearing instruments like T-bills.
The effects are recently observed in Bitcoin’s price because Bitcoin has continuously struggled to break out of the range since March 2023. The volatility indicators are currently near record lows and the trading volume has also reached its weakest since 2020. It indicates a sense of apathy in the market.
Bitcoin ETF is Inevitable
Jay Clayton, the former SEC chairman, says that even though the SEC is delaying applications, the approval of a Bitcoin ETF is inevitable. He said that a number of institutional investors are now showing support for spot Bitcoin. So, the SEC will eventually approve such ETFs sooner or later.
Although the SEC approved a Bitcoin futures ETF in 2021, the institute is concerned about market manipulation due to which they’re cautious about a spot Bitcoin ETF. However, the SEC’s previous concerns are now being challenged as some large institutes have introduced innovative surveillance mechanisms.
The federal court’s recent decision about Grayscale may play a vital role in the approval of spot Bitcoin ETFs.
Bitcoin Weekly Technical Analysis
Bitcoin is still trading in the sideways channel that was highlighted last week. The price action shows that the selling pressure has consistently dominated the market since July 14. So, even if the price jumped over the coming days, it will eventually find resistance at around $28,500 to $29,000.
However, once the sideways channel is confirmed, it will be easier to evaluate the future price movement of Bitcoin.
Conclusion
Bitcoin’s journey persists within a narrow range. As institutional collaborations and regulatory adjustments shape the crypto landscape, it remains a space to watch closely. With education initiatives in El Salvador, evolving tax policies in Japan, and the promise of a Bitcoin ETF on the horizon, the crypto world continues to evolve, promising both challenges and opportunities in the days ahead.