Hong Kong is not a good place for Coinbase to be based.

Good morning. Here’s what’s happening:

Prices: Crypto traders are optimistic about the Fed skipping a rate hike.

Insights: Hong Kong has rules for crypto, but they aren’t that great.

Prices

#amp-table { content-visibility: hidden; } #widget-container-responsive { padding:3px; font-family:’Helvetica Neue’, Verdana, sans-serif; font-size:13px; min-width:220px; margin-top:15px; display: flex; flex-direction: column; background-color: #fff; content-visibility: visible !important; } #content-responsive { border-radius: 5px 5px 0 0; margin: 0px; box-sizing: border-box; display: grid; } .content-cell { min-width:220px; padding:10px; float:left; } .content-cell-title { padding-bottom: 5px; color: #333; text-align: left; padding-bottom: 5px; } a.content-cell-link { color: #333; text-decoration: none; } .content-cell-value { color: #333; font-size: 18px; line-height: 42px; float:left; } .content-cell-value-row { font-weight: 700; display: block; } .diff-value { font-size: 12px; margin-right: 5px; color: #a3a3a3; line-height: 23px; } .return-success-dark { color: #00D964; } .return-success-light { color: rgb(25,135,84); } .return-danger-dark { color: #FF0000; } .return-danger-light { color: rgb(220,53,69); } .content-variation-container { text-align: right; padding-top: 12px; } .content-cell-value-variation { font-weight: 700; font-size: 16px; line-height”: 42px; } #disclaimer-responsive { font-size: 11px; min-width:300px; width:100%; margin:0 auto; text-align:center; } @media (min-width: 1024px){ #content-responsive { grid-template-columns: 1fr 1fr 1fr; } .content-cell-pos-0 { border-right: 1px solid lightgray; border-bottom: 1px solid lightgray; grid-column: 1 / span 1; grid-row: 1; } .content-cell-pos-1 { border-right: 1px solid lightgray; border-bottom: 1px solid lightgray; grid-column: 2 / span 1; grid-row: 1; } .content-cell-pos-2 { border-right: none; border-bottom: 1px solid lightgray; grid-column: 3 / span 1; grid-row: 1; } .content-cell-pos-3 { border-right: 1px solid lightgray; border-bottom: none; grid-column: 1 / span 1; grid-row: 2; } .content-cell-pos-4 { border-right: 1px solid lightgray; border-bottom: none; grid-column: 2 / span 1; grid-row: 2; } .content-cell-pos-5 { border-right: none; border-bottom: none; grid-column: 3 / span 1; grid-row: 2; } } @media (min-width: 600px) and (max-width: 1023px) { #content-responsive { grid-template-columns: 1fr 1fr; } .content-cell-pos-0 { border-right: 1px solid lightgray; border-bottom: 1px solid lightgray; grid-column: 1 / span 1; grid-row: 1; } .content-cell-pos-1 { border-right: none; border-bottom: 1px solid lightgray; grid-column: 2 / span 1; grid-row: 1; } .content-cell-pos-2 { border-right: 1px solid lightgray; border-bottom: 1px solid lightgray; grid-column: 1 / span 1; grid-row: 2; } .content-cell-pos-3 { border-right: none; border-bottom: 1px solid lightgray; grid-column: 2 / span 1; grid-row: 2; } .content-cell-pos-4 { border-right: 1px solid lightgray; border-bottom: none; grid-column: 1 / span 1; grid-row: 3; } .content-cell-pos-5 { border-right: none; border-bottom: none; grid-column: 2 / span 1; grid-row: 3; } } @media (max-width: 600px) { #content-responsive { grid-template-columns: 1fr; } .content-cell { border-right: none; border-bottom: 1px solid lightgray; } .content-cell-pos-0 { grid-row: 1; grid-column: 1; } .content-cell-pos-1 { grid-row: 2; grid-column: 1; } .content-cell-pos-2 { grid-row: 3; grid-column: 1; } .content-cell-pos-3 { grid-row: 4; grid-column: 1; } .content-cell-pos-4 { grid-row: 5; grid-column: 1; } .content-cell-pos-5 { border-bottom: none; grid-row: 6; grid-column: 1; } } blockchain Market Index (CMI) 1,103 −0.3 ▼ 0.0% Bitcoin (BTC) $25,948 +52.6 ▲ 0.2% Ethereum (ETH) $1,740 −1.7 ▼ 0.1% S&P 500 4,369.01 +30.1 ▲ 0.7% Gold $1,957 +1.7 ▲ 0.1% Nikkei 225 33,018.65 +584.7 ▲ 1.8% BTC/ETH prices per blockchain Indices , as of 7 a.m. ET (11 a.m. UTC)

(Note: This HTML code does not appear to make sense as it includes both HTML code and text in the same paragraph.)

Blockchain Market Index (CMI)
1,103 −0.3 ▼ 0.0%
Bitcoin (BTC)
$25,948 +52.6 ▲ 0.2%
Ethereum (ETH)
$1,740 −1.7 ▼ 0.1%
S&P 500
4,369.01 +30.1 ▲ 0.7%
Gold
$1,957 +1.7 ▲ 0.1%
Nikkei 225
33,018.65 +584.7 ▲ 1.8%
BTC/ETH prices per blockchain Indices , as of 7 a.m. ET (11 a.m. UTC)

Bitcoin is opening Asia’s trading day at $25,948, up 0.2%, while ether is at $1,740, down 0.1%.

Edward Moya, a Senior Market Analyst with OANDA, sees the likely possibility of the Fed skipping a rate hike on Wednesday (prediction markets are giving it a 96% chance of happening) and increased regulatory scrutiny of altcoins as fuel for bitcoin’s support.

“Cooling inflation report is fueling this bull market as the Fed should have no problem skipping a rate hike on Wednesday. Wall Street is becoming a little bit hopeful here that an FOMC June skip could eventually become a July pause,” Moya said in a note. “Bitcoin remains stable around the $26,000 level as investors consider reducing altcoin exposure and increasing Bitcoin holdings.”

Driven by falling car wholesale prices and weaker consumer support, disinflation, alongside the likely rate hike skip, is causing a decrease in the dollar’s value, Moya observes, and a steady demand for used vehicles, and clothing among other necessities; China’s stimulus package and expected Saudi oil price cuts have uplifted crude oil prices, and while low inflation initially boosted gold, continued stock growth may limit its rise.

At the same time, one key bitcoin technical analysis indicator, the moving average convergence divergence (MACD), has flipped bearish, signaling a possible extended price slide, despite Bitcoin maintaining support at $25K. In blockchain’s coverage of this, however, analysts noted U.S. inflation figures and the Fed’s possible rate hike skip could also impact Bitcoin’s price performance.

Biggest Gainers

Asset Ticker Returns DACS Sector
Avalanche AVAX +1.2% Smart Contract Platform
Terra LUNA +0.7% Smart Contract Platform
Chainlink LINK +0.7% Computing

Biggest Losers

Asset Ticker Returns DACS Sector
XRP XRP −2.9% Currency
Solana SOL −2.5% Smart Contract Platform
Polygon MATIC −2.4% Smart Contract Platform

Insights

Hong Kong’s Crypto Rules Aren’t Going to Bring in Exchanges

Amid an ongoing lawsuit from the Securities and Exchange Commission (SEC), one Hong Kong lawmaker has invited Coinbase to set up shop in the territory.

After all, Hong Kong is in the process of making rules for crypto. In the U.S., Coinbase has to sue to try and compel the SEC to make rules for it to operate.

So on paper Coinbase making a move to another jurisdiction would make sense, and Hong Kong, with its rulebook and traditional position as a fast-moving market hub in Asia, would be a logical place to move to.

In theory.

But the reality on the ground is that Hong Kong’s rulebook itself isn’t all that attractive to crypto exchanges.

First, the number of tokens available to trade will be limited compared to what users can expect from established exchanges.

Per rules from the Securities and Futures Commission, Hong Kong’s securities watchdog, there needs to be a 12-month cooling off between token launch and listing. Stablecoins are banned, as are crypto derivatives, earn or lend programs and likely staking services too. Airdrops are a huge no-no.

“Hong Kong’s framework as it exists today is highly unattractive. The market is small and unproven, banking partnerships are non-existent, and products are highly restricted,” Leo Weese, co-founder and President of the Bitcoin Association of Hong Kong, told blockchain.

Weese says that the Asian markets are “fundamentally different” from their Western counterparts, and Coinbase would not automatically succeed in Hong Kong, even if they were willing to give up their current customer base.

“What makes Hong Kong potentially attractive is that many tokens are not deemed securities, and those that are do not need to be registered like in the United States, making it possible to offer trading for tokens that are deemed unregistered securities elsewhere, such as decentralized protocols,” he said.

At the same time, Weese notes, moving to Hong Kong will not automatically shield Coinbase from U.S. regulation or the arm of the SEC.

BitMex, which calls Hong Kong home, got ensnared in U.S. regulatory regime despite its tenuous ties to the United States. And so did Binance – its mothership and founder squarely offshore.

So even if Coinbase were to make the move, it wouldn’t be a very productive decision.

Important events.

2:00 a.m. HKT/SGT(18:00 UTC) United States Fed Interest Rate Decision

5:45 a.m. HKT/SGT(21:45 UTC) New Zealand Gross Domestic Product (YoY/Q1)

7:50 a.m. HKT/SGT(23:50 UTC) Japan Exports (YoY/May)

blockchain TV

In case you missed it, here is the most recent episode of “First Mover” on blockchain TV :

The U.S. Consumer Price Index (CPI) for May rose just 0.1% compared to 0.4% in April, which was softer than expected. This was reported by the Bureau of Labor Statistics. The news came one day before the Fed’s latest monetary policy meeting. Clara Medalie, the Kaiko Director of Research, discussed the market reaction on “First Mover”. In addition, Mike Selig, Counsel at Willkie Farr & Gallagher LLP, joined to discuss the impact of the SEC’s actions against Binance and Coinbase on crypto. John Melican, the Elliptic Chief Legal Officer, was also on the show to talk about new findings revealing that attackers behind this month’s $35 million exploit of crypto wallet Atomic Wallet are moving stolen funds via OFAC-sanctioned exchange Garantex. Bitcoin Infrastructure Firm Blockstream is expected to unveil its long-awaited mining rig in 3Q of 2024 and plans to raise more capital to fund its mining business. Binance and Binance.US are going to court against the SEC’s motion to freeze all Binance.US funds. BTC, ETH and stablecoins have a combined market capitalization of 80% of the $1T crypto market cap as investors flee altcoins. XRP’s supporters believe the SEC unfairly targeted Ripple for securities violations while mysteriously giving Ethereum a free pass. Uniswap Labs is releasing its plan for Uniswap v4 and inviting community feedback as the SEC cracks down on its centralized competitors. This article was edited by James Rubin.

We will continue to update Phone&Auto; if you have any questions or suggestions, please contact us!

Share:

Was this article helpful?

93 out of 132 found this helpful

Discover more

Bitcoin

One year after Trudeau's warning, BTC still outperforms inflation and S&P 500.

Amidst the ups and downs of bitcoin in the past year, the world's largest digital asset has demonstrated its resilien...

Market

The Battle of Bitcoin: Bulls vs. Bears

Bitcoin price falls below $35,000 amidst signs of weakening bullish trend.

Market

Brace Yourselves: Crypto Market Crash May Be Looming in March, Warns Expert

Hayes predicts a potential resurgence of the U.S. banking crisis from last year due to the upcoming expiration of a c...

Policy

EU to evaluate export controls on AI tech and semiconductor chips.

The European Commission is actively evaluating these technologies due to their highly innovative nature, potential fo...

BlockChain

Amazon invests $4 billion in Anthropic AI startup.

The partnership will provide Anthropic with exclusive access to Amazon's cutting-edge cloud services, Trainium and In...

Bitcoin

🚀 Surprise! Bitcoin ETFs Soar, But BTC Price Responds with a Yawn 😴

CryptoQuant CEO Ki Young Ju has uncovered the true reason behind Bitcoin's recent subdued price movements, providing ...