Monat: März 2023

Bitcoin Open Interest Drops 15%: Is Spot Buying the Answer?

• Bitcoin open interest has dropped by 15% in the past two weeks, with roughly 300,000 BTC worth of contracts unwound since October 2022.
• The current OI level is similar to that seen in early 2022.
• This trend will continue if OI continues to decline while spot Bitcoin accumulates.

Bitcoin Open Interest Drops Almost 15% In Past Two Weeks

The total amount of funds allocated in open futures contracts, known as Open Interest (OI), peaked in October 2022 at 667,000 BTC. Now, only 368,000 BTC are allocated in OI contracts – a decrease of 300,000 Bitcoin and a drop of almost 15% in the past two weeks.

Price Increase Of Bitcoin Alongside Leverage Unwinding

Bolstered by this significant decrease in OI, Bitcoin’s price has jumped from $19,000 to $26,000 during this period. This increase is indicative of an extremely healthy market structure due to the unwinding of leverage alongside an increased price for the cryptocurrency.

Continuing The Trend

For this trend to continue and sustain itself over time–OI must continue to decline while spot Bitcoin accumulates. With more investors entering into the market and taking up long positions without having to borrow money or use leverage–the trend should persist over time if buyers keep their positions open and do not close them out quickly.

James Van Straten’s Take On The Situation

James Van Straten–Research Analyst at CryptoSlate–describes his take on this situation as “extremely healthy” as it allows for “freedom and technology maximalism” with Bitcoin being labeled as “the greatest invention of the 21st century”.

Disclaimer

CryptoSlate reminds its readers that no content within this article should be considered investment advice nor does CryptoSlate endorse any project mentioned or linked to within this article. Investing and trading cryptocurrencies should always be done with caution due to their volatile nature; CryptoSlate takes no responsibility should you lose money trading cryptocurrencies

Gaming Dominates Web3 Industry Despite Active Wallet Drop

• Gaming accounts for 45% of web3 industry active wallets in February, despite a 12.33% decrease in activity.
• Two games – Oak of Peak and Trickshot Blitz- increased their on-chain user counts, while DeFi’s dominance rate increased to 24%.
• WAX (WAXP) was the only major gaming blockchain to increase its DUAWs numbers in February.

Gaming Dominates Web3 Industry in February

Despite a decrease in Daily Unique Active Wallets (dUAW) of 12.33%, gaming still accounts for 45.43% of the decentralized application (dApp) industry as of the end of February, according to a recent DappRadar report. This marks an increase from January’s 48%, but it is still nearly double the amount of DeFi’s dominance rate which increased to 24%.

Games Increase On-Chain User Counts

Two games – Oak of Peak and Trickshot Blitz- have bucked the trend and recorded increases in on-chain user counts. Additionally, game developer Unity has entered the field by offering 13 blockchain-based software development kits (SDK).

WAX Records Increase In DUAWs

The overall decrease in dUAWs affected all major gaming blockchains apart from WAX (WAXP), which recorded an increase with 342,764 dUAWs at the end of February – 3.26% higher than January’s figures.

Other Blockchains Record Decrease In DUAWs

HIVE (HIVE) recorded the most significant shrink at 36%, followed by Polygon (MATIC), BNB Chain (BNB), and EOS (EOS) who shrunk by 35%, 12%, and 3.44%, respectively.

Conclusion

Despite recording a decrease in activity, gaming remains dominant over web3 industry with more than 45% market share compared to DeFi’s 24%. However, two games – Oak Of Peak and Trickshot Blitz– managed to go against this trend and record increases in their user count while WAX was the only major gaming blockchain that increased its DUAW number

Hong Kong’s Stricter Crypto Regulations Aims to Boost Investor Confidence

• Hong Kong has become a major hub for financial services, blockchain and cryptocurrency.
• The government of Hong Kong has introduced a licensing regime for Virtual Asset Service Providers (VASPs).
• The updated Anti-Money Laundering Ordinance is in line with the Financial Action Task Force (FATF) Recommendation 15.

Hong Kong’s Growing Crypto Scene

Hong Kong has been a major financial hub for many years, and in recent years, it has shown increasing interest in blockchain and cryptocurrency technologies. The government of Hong Kong has indicated its support for the industry’s development, and many initiatives are underway to help create a favorable environment for crypto and blockchain businesses. Hong Kong also boasts active blockchain and cryptocurrency communities that provide support and resources for businesses and developers in the industry. Many events and conferences related to blockchain and cryptocurrency in the city help create networking opportunities and promote the industry’s growth.

New Regulatory Framework

In December 2022, the Legislative Council of Hong Kong passed an amendment to the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), introducing a licensing regime for virtual asset service providers (VASPs). This new regulatory framework requires all VASPs operating in Hong Kong to obtain a license from the Securities and Futures Commission (SFC). Without such a license, individuals or businesses cannot offer VA services or declare themselves as VASPs.

Benefits of Stricter Regulations

The implementation of stricter regulations is expected to benefit both investors as well as companies involved in crypto trading activities. It will help protect investors by ensuring that only legitimate companies are able to operate legally under these regulations. On top of that, it will also increase investor confidence since they know that their investments are secure under these laws. In addition, it will also make it easier for legitimate companies to conduct business without fear of legal repercussions due to lack of compliance with existing regulations.

HKMA’s Initiatives

The Hong Kong Monetary Authority (HKMA) has launched several initiatives to support the development of blockchain and digital currencies. For example, the HKMA is working on developing a central bank digital currency (CBDC), as well as launching a blockchain-based trade finance platform which can facilitate more efficient transactions between parties worldwide.

Conclusion

Overall, stricter crypto regulations implemented by Hong Kong have been met positively by both investors as well as companies involved in this space since they enable better protection against fraudsters while creating an environment conducive for legitimate businesses operating within this space. With increased investor confidence due to strict regulations coupled with initiatives from HKMA towards encouraging further adoption of cryptocurrencies, we can expect great progress from this country when it comes to digital assets going forward into 2023!