Synopsis
- Rising Rates, Crypto and Stocks
- Friend.tech Enhances User Security with 2FA Amidst SIM-Swap Attacks
- Switzerland’s Backed Finance Paves the Way for Asset Tokenization in Crypto Markets
- Biggest winner and loser of the week
Key Observations
Macro Turmoil: How Rising Rates Shake Crypto and Stocks
The crypto market faces a formidable challenge in the form of soaring long-term interest rates. This upward trend is exerting pressure on digital assets and traditional stocks, leaving investors on edge. However, the resilience displayed thus far might result from a deep-seated belief that a continued rise in interest rates could trigger a US bond market shakeup, a scenario akin to the UK’s recent experience. If this disruption materializes, the Federal Reserve might find itself compelled to intervene, much like the Bank of England did.
There’s another concern bubbling beneath the surface, and it revolves around the impact of rising long-term rates on bond prices. As bond prices plummet, banks could grapple with significant unrealized losses. Signs of stress are already evident in the UK’s banking sector, sparking speculation of a second intervention by the Bank of England or, in the worst-case scenario, the involvement of the Federal Reserve. Interestingly, such a scenario could be a silver lining for the cryptocurrency market as investors seek refuge in alternative assets during financial turmoil.
Friend.tech adds new security upgrade in wake of SIM-swap attacks
The creators of the decentralized social media platform, Friend.tech, have introduced an additional security feature(2FA) to combat the rising tide of SIM-swap attacks targeting their user base. Users of Friend.tech will now receive a prompt to set an extra password when signing in on new devices.
The total value locked on Friend.tech currently sits at $43.9 million, down 15.5% from its all-time high of $52 million on Oct. 2, according to DefiLlama.
Tokenized US Treasury Bonds to Debut on Coinbase Exchange
Backed Finance, a Switzerland-based firm specializing in asset tokenization in association with Coinbase is introducing tokenized US Treasury bonds. This innovative product will only be accessible to businesses that adhere to stringent know-your-customer (KYC) and anti-money laundering (AML) regulations. The tokenization businesses are gaining in popularity, and could reach a market capitalization of $16 trillion in 2030, as noted by the Boston Consulting Group report.
Top gainer of the week: Tezos (XTZ) up by 4.66% ⬆️
Opinions:
Fundamental Analysis:
There doesn’t appear to have been any one fundamental catalyst behind Monday’s upside for Tezos.
Technical Analysis:
XTZ appeared to break an important trendline from 2021 on Monday, which could have potentially triggered some technical buying. When an asset breaks out of a long-standing downtrend like this, it signals the end of a long bear market. However, we may also see the support regions of 0.70 and 0.69 being tested if there is a drop.
Oscillator indicators: 0 bearish, 7 neutral, 4 bullish
Moving average indicators: 4 bearish, 1 neutral, 10 bullish
Biggest loser of the week: Arbitrum (ARB) down by 10.76% ⬇️
Opinions:
Fundamental analysis:
ARB was dumped by whales and has not yet found major support. We expect it to breakout with an increase in buy pressure.
Technical analysis:
We anticipate that there will be a correction which shall revisit early September levels of 0.8. There is a probability of ARB moving upwards once it breaks out from such levels.
Oscillator indicators: 2 bearish, 8 neutral, 1 bullish
Moving Average indicators: 13 bearish, 1 neutral, 1 bullish
Conclusion
The cryptocurrency market was marked with important events. The impact of rising interest rates could influence investor confidence in crypto markets. This was followed by news of Coinbase introducing Tokenized US Treasury bonds. The activity in the market suggests that the market has to regain its footing amidst the recent geopolitical tensions as well.
