Crypto Flipsider News – BTC and ETH Lead Market Correction, Novogratz Remains Bullish; EU Parliament Passes Anti-Privacy Crypto Bill, 115K Investors Get Liquidated; BNY Mellon to Hold Custody of USDC Reserves; Chiliz Launches Public Testnet

Read in the Digest:

Bitcoin and Ethereum lead market correction, Novogratz sees crypto ending 2022 on a high.

EU parliament pass anti-privacy crypto bill, 115K investors get liquidated.

Circle chooses BNY Mellon as custodian for USDC stablecoin reserves.

Chiliz launches Scoville, the public testnet for its Layer-1 blockchain.

Bitcoin and Ethereum Lead Market Correction, Novogratz Sees Crypto Ending 2022 On a High

After gaining over 25% within two weeks to set a new high for 2022, the crypto market has been forced into a steep correction. Market leaders Bitcoin and Ethereum led the downtrend, having lost 5% and 4% respectively over the last 24 hours.

Bitcoin dropped from its recent 90-day high of $48,086 down to $44,403, though a few solid hours of recovery has seen Bitcoin stabilize to trade at $45,238 as of this writing.

The 24 hour price chart for Bitcoin (BTC). Source: Tradingview

The market correction also saw Ethereum, the world’s second-largest crypto, retract from its recent high of $3,470 down to $3,309.

The 24 hour price chart for Ethereum (ETH). Source: Tradingview

The faltering of its market leaders spread to the broader crypto space, with Avalanche (AVA), XRP (XRP), Cardano (ADA), and Polkadot (DOT) each losing 7% over the last 24 hours. As a result, the global crypto market cap has been cut by $100 billion in the last 48 hours.

Flipsider:

Despite the lackluster performance of cryptos, Mike Novogratz of Galaxy Digital has remained bullish about crypto’s prospects for the year.

Novogratz asserted that it wouldn’t surprise him if cryptos were trading “significantly” higher than they are now at the end of the year.

EU Parliament Passes Anti-Privacy Crypto Bill, 115K Investors Get Liquidated

Citing concerns about their potential disruption of the stability of financial markets and their use in crimes, the EU parliament passed stricter laws for the crypto industry as members of the parliament voted in favor of outlawing anonymous crypto transactions.

The bill also proposes that AML be required for all crypto transactions, including those from unhosted or self-hosted wallets. In addition, unregulated crypto exchanges may be cut off from conventional financial systems.

In the wake of the bill, pushed by members of the EU parliament, the crypto market was dragged into its third consecutive day of losses. As a result, 115,015 crypto traders have liquidated over the last 24 hours.

According to data from ‘CoinGlass’, traders saw more than $387 million in liquidations as the cryptocurrency market tanked by over 5%. Approximately $40 million in Bitcoin long positions were liquidated.

Flipsider:

Many members of the European People’s Party (EPP) opposed the changes, calling it a “de facto ban of self-hosted wallets.”

Why You Should Care

Beyond the immediate impact of the news, the move could potentially stifle innovation in the crypto industry.

Circle Chooses BNY Mellon as Custodian for USDC Stablecoin Reserves

The issuers of the second-largest stablecoin, Circle, have selected BNY Mellon to manage custody of its USD Coin (USDC) reserves. The decision diverges from Circle’s previous decision to hold its reserves in cash and treasuries.

In a public announcement, Circle Internet Financial revealed that America’s oldest investment bank will become the primary custodian for USDC. Announcing the partnership, Jeremy Allaire, co-founder and CEO at Circle, said;

“The opportunity to work with BNY Mellon is one way we build bridges between traditional financial services and emerging digital asset markets without sacrificing trust.”

Circle’s USDC is currently the world’s second-largest stablecoin, second only to pioneer stablecoin Tether. Pegged 1:1 with the USD, USDC has a market cap of $51.36 billion.

Flipsider:

Terra, the issuer of TetherUSD, USDC’s main competitor, has opted to back its stablecoin with Bitcoin.

Why You Should Care

Circle hopes the decision will create a bridge between the traditional and digital capital markets and aid the exploration of digital cash for settlement purposes.

Chiliz Launches Scoville, the Public Testnet for Its Layer-1 Blockchain

Chiliz, a project developed to bridge sports entertainment and the crypto industry, has announced the launch of its public testnet Scoville. The testnet is preparation for the project’s migration to its Layer-1 blockchain network ‘Chiliz Chain 2.0 (CC2)’.

With the launch of Chiliz Chain 2.0, Chiliz claims that its second-generation blockchain will allow sports and entertainment brands to build Web 3.0 applications, such as play-to-earn games and other decentralized applications.

Pending the successful launch of the public testnet, the firm intends launch the mainnet for Chiliz Chain 2.0 by the end of 2022. CC2 will be powered by the $CHZ token.

The full deployment of CC2 will see Chiliz migrate from its existing Ethereum-based blockchain to the Binance Smart Chain. Chiliz has promised EVM compatibility, with gas fees up to 200x cheaper than ETH.

Flipsider:

Chiliz has also unveiled an accelerator program — Chiliz Labs — to foster on-chain development on CC2.

Why You Should Care

Moving to a Layer 1 blockchain could increase the demand for Chiliz as the project looks to attain even greater inclusion of sports entertainment in the crypto space.