The Fed, FTX, and Falling Prices: Key Events Shaping the Crypto Market This Week


Market Price Action

This week saw dramatic shifts in the crypto market, starting with Bitcoin reaching an all-time high of $108,319, driven by former U.S. President Donald Trump’s hint about a potential Bitcoin Reserve. However, a statement by Federal Reserve Chair Jerome Powell, confirming the Fed’s inability to own Bitcoin, caused a sharp crash, with Bitcoin now trading at $93,000, down 7.4% on the week. Other major cryptocurrencies experienced significant losses as well: Ethereum (ETH) plunged 19%, XRP dropped 15%, and Solana (SOL) saw a staggering decline of 21%, as red dominated the market. Altcoins across the board mirrored the bloodbath, reflecting a brutal week for the crypto space.


African Crypto News

  • Yeshara Tokens Joins Kenya’s Regulatory Sandbox: Kenyan blockchain platform Yeshara Tokens entered the Capital Markets Authority (CMA) Regulatory Sandbox to test its real estate tokenization platform. Over the next 12 months, the platform will focus on enhancing retail participation in tokenized assets, adhering to CMA regulations while testing its blockchain-powered innovation.
  • EFCC Busts Crypto Fraud Syndicate in Lagos: The Economic and Financial Crimes Commission (EFCC) in Nigeria arrested 193 foreign nationals linked to a crypto fraud syndicate in Lagos. The operation highlights Nigeria’s ongoing efforts to combat crypto-related scams, emphasizing the importance of regulation and awareness in Africa’s largest crypto market.
  • Ethereum Dominates Africa’s Crypto Developer Report: The 2024 Developer Report revealed Ethereum remains the most popular blockchain among African developers. Its robust ecosystem, community support, and versatility continue to attract builders, cementing Ethereum’s position as the preferred choice on the continent.
  • South Africa Approves 248 Crypto Providers: The Financial Sector Conduct Authority (FSCA) of South Africa announced the approval of 248 crypto service providers out of 420 applications, marking a significant step toward regulatory clarity in one of Africa’s leading crypto markets. This move underscores the country’s commitment to fostering a compliant and secure crypto ecosystem.

Global Crypto News

  • Michael Saylor Adds to Bitcoin Holdings: MicroStrategy’s CEO, Michael Saylor, made another massive Bitcoin purchase, acquiring 15,350 BTC for $1.5 billion, bringing the company’s total holdings to 439,000 BTC. Saylor continues to double down on his bullish stance despite market volatility.
  • VanEck Predicts a Bullish Future for Bitcoin: Investment firm VanEck released a bullish forecast for Bitcoin, predicting it will hit $180,000 by 2025, with Ethereum climbing to $66,000. However, the firm cautioned about a 30% summer correction for Bitcoin and a steeper 60% decline for altcoins, urging traders to brace for short-term volatility.
  • Solana Outpaces Ethereum in Developer Growth: For the first time since 2016, the Solana ecosystem attracted more new developers than Ethereum, growing by 83% year-on-year. This growth highlights Solana’s rising appeal among builders, driven by its high-speed transactions and low fees.
  • Binance Dominates Crypto Deposits: Binance cemented its position as the leading crypto exchange, reporting $21.6 billion in deposits this year—more than the combined deposits of the top 10 exchanges. The platform’s dominance reflects strong user trust and a growing institutional footprint.
  • FTX to Use Stablecoins for Bankruptcy Payments: Embattled exchange FTX announced plans to process bankruptcy payments using stablecoins through BitGo and Kraken exchanges. This move aims to streamline repayments and rebuild user trust as the company navigates its ongoing legal challenges.
  • U.S. Federal Reserve Cuts Interest Rates: The Federal Reserve reduced interest rates by 25 basis points, a move that could potentially influence crypto markets. Lower rates often drive risk-on sentiment, potentially benefiting Bitcoin and other digital assets in the medium term.

Ecosystem Updates

  • Pudgy Penguins Launch $PENGU Token: Popular NFT project Pudgy Penguins launched its $PENGU token on Solana. Token claims will remain open for 88 days before any unclaimed tokens are burned, marking another major NFT project expanding into Solana’s vibrant ecosystem.
  • Lido to End Polygon Services: Liquid staking platform Lido announced plans to terminate its services on Polygon due to low user adoption. The decision highlights the challenges of scaling DeFi solutions across multiple chains with varying user demand.
  • $FARTCOIN Leads AI Memecoin Market: In an unexpected turn, $FARTCOIN emerged as the largest AI-powered memecoin by market capitalization, demonstrating the continued fascination with meme-driven crypto projects even in a challenging market environment.

Regulation and Legal News

  • Texas Man Sentenced for Crypto Tax Evasion: Frank Richard Allen III, a Texas-based crypto trader, was sentenced to two years in prison and fined $1.1 million for evading taxes on $4 million in crypto profits. This case serves as a stark reminder of the importance of tax compliance in the crypto space.

Conclusion

This week in crypto was marked by dramatic price action, regulatory developments, and innovation across ecosystems. While Bitcoin’s all-time high and subsequent crash dominated headlines, Africa’s growing crypto adoption and developer activity also took center stage. Stay tuned for next week’s updates as the crypto landscape continues to evolve.

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