Information abound in the world of crypto lately. In the first six months of the year, Ether, the token of the Ethereum blockchain, experienced a robust 61% rise. Things look even more promising, with traders casting their bets on another rally in the second half of the year. A trader made a significant move recently, acquiring around 63,250 “bull call spreads” linked to Ether, set to expire at the end of December.
However, it’s not all about gains. The strategy’s deployment cost was $10 million, revealing that the trader spent more on the $1,900 call option than they earned from the sale of the $2,500 call. It’s an intricate dance of balance and calculation, with a call buyer securing protection against price rallies from the seller, and the seller getting an upfront premium from the buyer.
Favorable tides seem to be brewing in the US Securities and Exchange Commission (SEC) too. The SEC’s position on spot bitcoin exchange traded funds (ETF) is reportedly steadily moving from steep to promising, according to brokerage firm Bernstein. With the SEC already permitting futures-based bitcoin ETFs, even green-lighting leverage-based futures ETFs on the strength that futures pricing hails from a regulated exchange such as the CME, the chances are looking good.
Nonetheless, analysts led by Gautam Chhugani point out an area of concern, emphasizing that a spot bitcoin (ETF) might not hold reliability due to the SEC’s perspective. The Commission sees the spot exchanges, for instance, Coinbase, not being under its regulation making spot prices susceptible to manipulation.
Shifting scenes over in Singapore, as crypto service providers received news from the Monetary Authority of Singapore (MAS) about a new mandate set to improve customer protection. Providers are expected by year-end to put into a statutory trust all customer assets for safekeeping. Accompanying this announcement is the restriction barring cryptocurrency service providers from aiding retail customers with token lending and staking. However, institutional and accredited investors remain privileged to capitalize on these services.
Parallels can be seen in the global economy where slumps in the average year-on-year growth rate of four Asian economies – Taiwan, South Korea, Japan, and China are igniting potential devaluation of currency. This adverse trend in export growth could thus drive demand for perceived inflation hedges like gold and bitcoin.
Navigating the crypto world demands a keen eye, weighing out the opportunities and pitfalls inherent in blockchain technology and its accompanying markets and regulations. Stay tuned and informed.
Source: Coindesk
