💡 Crypto Weekly Wrap: 16th June
🏢 Is the FED pivot here?
This week, the Federal Reserve decided to keep interest rates on hold for the first time in 15 months. There have been 10 consecutive interest rate hikes in the US. Jerome Powell stated that there would be another 2 possible rate hikes later this year, with analysts calling it a "Hawkish Pivot". Is this a classic case of Jawboning the market? The market's immediate reaction was a risk-off move with equities and cryptocurrencies falling to the downside. However, since the initial reaction, equities and cryptos have recovered some ground and the US Dollar Index has declined to the 102.10 support level.
🏦 US Banking Crisis Not Over
This year has already seen a number of high-profile banking failures, including the second-largest in US history. As the US banking industry struggles with a confidence and liquidity crisis, it has relied significantly on the Federal Reserve's lending lifeline. The newest numbers show borrowings through the Fed's Bank Term Fund Programme (BTFP), which assists struggling banks, surpassed the critical $100 billion mark. The outstanding loans from BTFP stood at $100.16 billion on June 7th, up from $93.61 billion at the end of May. According to reports, the US banking sector is suffering from unrealized losses totalling $620 billion.
📈 BlackRock Close to Filing for Bitcoin ETF Application:
The largest asset manager in the world, BlackRock, applied for a bitcoin exchange-traded fund (ETF) on Thursday, giving investors access to the cryptocurrency as the asset class comes under heavy regulatory scrutiny. According to the source, BlackRock will use Coinbase (COIN) Custody for the ETF and spot market data from the cryptocurrency exchange for pricing. Applications for spot bitcoin ETFs have yet to receive approval from the American regulator. The SEC turned down Grayscale Investment LLC's request to turn its primary cryptocurrency trust, Grayscale Bitcoin Trust (GBTC.PK), into an ETF last year.
👉 XRP Continues its CBDC Quest:
Ripple, a prominent contributor to the blockchain payment field, has made an unexpected move by working with Colombia's Central Bank, Banco de la Republica. The breakthrough collaboration aims to harness the XRP Ledger's powerful capabilities to create a cutting-edge CBDC. The collaborative effort intends to improve the country's payment infrastructure by leveraging the possibilities of blockchain technology. Ripple's CBDC platform will be rigorously tested and trialled in a controlled setting. The purpose of this experimental pilot programme is to assess the use of Ripple's CBDC platform in high-value payment scenarios. It is an important component in the third phase of blockchain experimentation at the Ministry of Information and Communications Technologies.
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