2024-11-13 13:49

The core CPI rate rose 0.3% last month, also in line with forecasts. October CPI data for the U.S. met economist estimates. The price of bitcoin rose above $89,000 following the numbers. The chances of another Fed rate cut in mid-December jumped to 69% just after the data. U.S. inflation data for October exactly matched economist estimates, sending bitcoin back towards the $90,000 level. The Consumer Price Index (CPI) rose 0.2% in October versus forecasts for 0.2% and a 0.2% rise in September, according to a government report on Wednesday morning.. On a year-over-year basis, the CPI was higher by 2.6%, also matching forecasts even as it rose from 2.4% in September. Core CPI – which excludes more volatile food and energy costs – rose 0.3% in October versus estimates for 0.3% and 0.3% in August. Year-over-year core CPI was 3.3% versus an expected 3.3% and 3.3% in September. The price of bitcoin (BTC) gained following the numbers to $89,500. It remains higher by nearly 30% over the past week. The U.S. Federal Reserve has cut the federal funds rate by 75 basis points since beginning an easing cycle in September. Easier monetary policy across nearly all Western central banks combined with the crypto-friendly Donald Trump election victory last week has provided the fuel for bitcon's run to new all-time highs. According to CME FedWatch — which factors in short-term interest rate movements into odds on what the Fed may do at its next policy meeting — the chances for an additional 25 basis point rate cut in mid-December were just under 60% prior to this morning's data and rose to 69% just after the print. https://www.coindesk.com/markets/2024/11/13/us-cpi-meets-estimates-rising-02-in-october-bitcoin-moves-above-89k/

2024-11-13 11:04

Headline inflation year-over-year is expected to increase by 0.2% and end a six-month consecutive decline, last seen in March 2024. Consensus for headline inflation year-over-year is expected to increase by 0.2% to 2.6% — the first year-on-year increase since March 2024. Bitcoin's 30-day implied volatility spiked to as high as 90% past week, and could see further volatility when U.S. inflation data is announced. The U.S. inflation report set to be released on Wednesday has the potential to stir up bitcoin (BTC) price volatility, ending the 48-hour period of calm. Its been a whirlwind week for cryptocurrencies, with Donald Trump winning the U.S presidential election on Nov. 6. As a result, the total cryptocurrency market jumped from $2.2 trillion to $3 trillion back down to approximately $2.8 trillion, according to TradingView. While bitcoin (BTC), the largest cryptocurrency by market capitalization, touched $90,000 on Nov. 12 just before U.S. equity markets closed. U.S. inflation data is not squashed Per FXStreet, the U.S. consumer price index (CPI) due at 8:30 ET, is expected to show that the cost of living increased 2.6% year-on-year in October, having risen 2.4% in the preceding month. This would be the first year-on-year increase since March. The issue of embedded inflation is not from headline but from core inflation, year-over-year. Early this year, we saw core come down from 3.9% to 3.2%. However, it turned higher in September to 3.3%, presenting a challenge to the Fed. The concern of inflation not being slayed can be shown in the U.S. yields, which have only soared since the Federal Reserve started the rate-cutting cycle with a 50bps rate cut, followed by a further 25bps rate cut. Since the first rate cut on Sep. 16, the U.S. 10Y has jumped from 3.6% to 4.4%. With the U.S. 3-month treasury yield trading at 4.6%, which follows the effective federal funds rate, it's suggesting that no more than 25bps of rate cuts will occur over the next three months, as the current target rate is 450 - 475. So, with a spike in implied volatility and an expected increase in headline inflation YoY, could bitcoin see a dramatic price swing later today? Implied volatility has risen Implied volatility for options contracts expiring one week from today has spiked from 40% to as high as 90% due to bitcoin's climb to $90,000, an increase of more than $20,000 since Nov. 6. Glassnode defines implied volatility as the market's expectation of volatility. Viewing At-The-Money (ATM) IV over time gives a normalized view of volatility expectations, which will often rise and fall with realized volatility and market sentiment. How has bitcoin fared on previous U.S. CPI releases? Inflation data releases brought downside volatility to bitcoin in the first quarter. It performed negatively as inflation remained almost double the inflation target. For example, bitcoin fell as much as 7.5% on Jan. 12 when the U.S. reported a hotter inflation figure for December. However, as the year progressed and headline inflation YoY continued to slow, this became more of a bullish event for bitcoin, eventually registering a 6.7% price increase on Jul. 15 as an example. As inflation slowed, the market became more efficient and produced three consecutive 0-1% price movements. Now, inflation is expected to rebound again. https://www.coindesk.com/markets/2024/11/13/volatility-expected-in-bitcoin-later-today-as-us-headline-inflation-data-is-expected-to-tick-higher/

2024-11-13 10:29

Daren Li oversaw the transfer of more than $73 million from crypto scam victims to wallets he and his co-conspirators controlled. Daren Li used multiple bank accounts and Tether to move money stolen from victims. More than $4.5 billion was lost to cryptocurrency investment scams last year. A Chinese citizen linked to Cambodian "pig butchering" operations pleaded guilty to one count of conspiracy to commit money laundering in a scheme to launder millions of dollars in proceeds of cryptocurrency investment scams, the U.S. Department of Justice (DOJ) said on Nov. 12. Daren Li, a 41-year-old native of Shaanxi province in China who also holds citizenship from St. Kitts and Nevis, laundered over $73 million from scam victims using a web of shell companies and international bank accounts, the DOJ said. He will be sentenced on March 3 and faces a maximum of 20 years in prison. Li was arrested on April 12 at Hartsfield-Jackson Atlanta International Airport. The DOJ described him as a resident of China, Cambodia and the United Arab Emirates. Co-conspirator Yicheng Zhang, a 38-year-old Chinese national who lives in California, was arrested in Los Angeles on May 16. “Although Li committed this offense from outside the United States, he was not beyond the reach of the Justice Department," Nicole M. Argentieri, head of the Justice Department’s criminal division, said in a statement. "Today’s plea reflects our ongoing commitment to working with our domestic and international partners to hold accountable anyone responsible for cryptocurrency investment fraud against U.S. victims — wherever the perpetrators are located.” Losses from crypto investment scams hit $4.5 billion in 2023, according to the FBI. As the figure is based on reported incidents, the real total is likely to be much higher. Among the different types of scams, pig butchering has garnered significant attention. It targets victims by having perpetrators strike up friendships online before enticing them to invest in a cryptocurrency platform, sometimes even pretending to have secret knowledge of the inner workings of the platform to make an investment a sure bet. Victims are initially able to withdraw money from the platform, which encourages them to invest more significant amounts before withdrawals are frozen. Pig butchering scams are conducted at scale by companies with links to organized crime, particularly in Southeast Asia. Myanmar and Cambodia alone are suspected of having over 220,000 individuals involved, some of whom have been trafficked to the region on false pretenses of legitimate jobs, according to the United Nations. Li played a role in laundering the money from victims, according to court documents. He instructed co-conspirators to open U.S. bank accounts established on behalf of shell companies and would monitor the receipt and execution of interstate and international wire transfers of victim funds. Li and his co-conspirators would then receive victims’ funds in financial accounts they controlled and monitor the conversion to virtual currency, specifically Tether's USDT stablecoin and its subsequent distribution to cryptocurrency wallets they also controlled. Some of these proceeds were to bank accounts at Deltec Bank in the Bahamas. In June, authorities seized over $58 million in funds from the bank during an investigation into international money laundering, wire and bank fraud. A representative for Deltec Bank told CoinDesk at the time that the investigation related to crimes committed by individuals and denied any wrongdoing https://www.coindesk.com/policy/2024/11/13/money-launderer-who-moved-scam-victims-funds-faces-up-to-two-decades-in-us-prison/

2024-11-13 09:31

All we would say here is not to fight this emerging dollar uptrend, ING said. BTC takes a bull breather at the key $90,000 barrier that CoinDesk identified last week. Crypto traders anticipate an eventual breakout toward $110,000. Continued dollar strength, anticipated by FX traders, might lead to financial tightening and slow BTC's ascent. Bitcoin (BTC) is taking a bull breather at the $90,000 resistance level CoinDesk identified last week as foreign-exchange traders focus on the rally in the dollar index (DXY), raising the risk of financial tightening that often weighs on risk assets. Since early Tuesday, bitcoin's supposedly euphoric rise has hit a snag at the $90,000 barrier, with prices briefly dipping to $85,000, CoinDesk data show. It's completely normal for such a pause to occur after a staggering $20,000 price surge in just a week, shattering previous lifetime peaks. Such pauses typically recharge bulls' engines for the next leg higher and traders in the options market are positioning for a breakout to $110,000-$120,000, according to data shared by QCP Capital. Betting on a dollar rally Still, it could be more than coincidence that the rally has paused alongside reports of traders betting on a continued rise in the dollar index, which tracks the U.S. currency's value against major fiat currencies. "Traded levels of volatility are rising notably as it seems the market is actively positioning (investors) or hedging (corporate treasurers) in expectation of a stronger dollar," ING said Tuesday. "All we would say here is not to fight this emerging trend." Both BTC and USD, part of the so-called "Trump trades," have surged since Donald Trump's victory in the U.S. election held a week ago. The DXY has risen by 2.7% to 106.78, hitting a six-month high, according to TradingView. Persistent dollar strength, however, could restore the historical negative correlation between the two and at least slow down BTC's ascent, if not halt it altogether. That's because the U.S. dollar is a global reserve currency with an outsized role in global trade, international debt and non-bank borrowing. An appreciating dollar commonly has investors with dollar-denominated debt and servicing costs trim exposure to riskier assets such as stocks and cryptocurrencies. Hardening bond yields Yields on U.S. Treasury notes are also hardening, providing additional support for the dollar. The yield on the two-year note rose to 4.36% Tuesday, the highest since July 31. The 10-year note bounced close to the multimonth high of 4.46% seen a week ago. The market action likely reflects concerns that President-elect Donald Trump's policies, especially mass deportations, could breed inflation, making it harder for the Federal Reserve to cut interest rates next year. "Strong immigration was one of the big things that made central banks (not just the Fed) much more relaxed about underlying price dynamics," Dario Perkins, managing director of global macro at TS Lombard, said in a Nov. 11 note to clients. "It helped to solve post-COVID labor shortages (not just in the U.S.). Sending millions of people back to their country of origin would reverse those trends and – depending on how many people were deported – recreate the situation we were in two years ago." https://www.coindesk.com/markets/2024/11/13/bitcoin-price-rally-hits-a-wall-at-90k-resistance-while-fx-traders-back-the-dollar-bull-run/

2024-11-13 09:07

The scheme promised 20x returns through investing in tokens that in reality had little value. An unidentified YouTuber ran a fake investment company and induced Koreans to invest in worthless tokens, South Korean police said. Between late 2021 and March 2023, the scheme allegedly took more than $232 million from victims. Police in South Korea arrested 215 people in an investigation into a suspected 325.6 billion won ($232 million) cryptocurrency investment scam, Yonhap reported. The Gyeonggi Southern Provincial Police Agency's Anti-Corruption and Economic Crime Investigation Unit said the arrests included staff from a fake investment consulting firm and an unidentified YouTuber with 620,000 subscribers. Gyeonggi is a South Korean province that surrounds the capital, Seoul. Between December 2021 and March last year, the scheme allegedly defrauded more than 15,000 people by promising high returns from investments in virtual assets. Targeting mostly middle-aged and older people, it promised 20x returns and encouraged people to sell their apartments and take out loans to fund their investments. The investment itself included 28 different tokens, six of which were created by the group. The remaining 22 had low trading volumes and were determined to have little value. Twelve of those arrested remain in detention, including the YouTuber, who also headed the consulting firm. He initially fled South Korea to Australia via Hong Kong and Singapore. The report did not give the names of those involved. https://www.coindesk.com/policy/2024/11/13/south-korean-police-arrest-215-in-suspected-232m-crypto-investment-scam-investigation-yonhap/

2024-11-13 08:45

The long-anticipated LINEA token comes as the next U.S. president is expected to usher in a more favorable regulatory environment for cryptocurrency. Consensys, a leading Ethereum development firm, is ready to release a token for Linea, its layer-2 blockchain network. The plan comes after Donald Trump's reelection has lifted a regulatory "cloud" over blockchain companies in the U.S. LINEA will be issued as rewards to active contributors and users of the rollup network, sometime in Q1. Linea, the rollup blockchain built by Ethereum development firm Consensys, is on the brink of releasing its "LINEA" token, the company told CoinDesk. Consensys was founded by Joe Lubin, one of the co-founders of Ethereum, and is today best-known as the company behind MetaMask, the most popular Ethereum wallet. The Linea network was released last year and represents Consensys' attempt to compete with a growing fray of layer-2 networks — blockchains that help scale Ethereum by offering users an extra lane for transacting more quickly and cheaply. According to Texas-based Consensys, the LINEA token will be issued as rewards to active contributors to, and users of, the Linea network. The exact distribution criteria and timeline have yet to be disclosed, but Consensys said it expects to release LINEA sometime in the first quarter of next year. Ethereum's layer-2 ecosystem has flourished over the past two years, with networks such as Arbitrum, Optimism and Base gradually outpacing the main Ethereum chain in terms of overall transaction volume. Linea sought to differentiate itself from many early rollup networks by centering itself around zero-knowledge technology—a kind of cryptography that Ethereum developers expect to eventually become the dominant method for scaling the network. But its lack of a token has long been viewed as a disadvantage, as most other layer-2 platforms dangled the prospect of tokens in part as a way to attract users. Regulatory 'cloud' lifted The LINEA announcement comes just after Donald Trump's re-election to the U.S. presidency. Consensys was one of the most closely watched U.S.-based blockchain companies during the Biden administration's crackdown on the industry. MetaMask is nearly ubiquitous among Ethereum users, and some feared that position would make Consensys a target of anti-crypto regulators looking for potential points of network centralization. The incoming administration is widely expected to take a more favorable view of the crypto industry. Several teams at Ethereum's Devcon conference in Bangkok, where Consensys unveiled its plans for LINEA, told CoinDesk they were optimistic a second Trump administration would foster a friendlier environment for issuing tokens. Lubin said the election did not play a role in Consensys' decision to finally announce LINEA, but he acknowledged that "we've been operating under a cloud of uncertainty for a long time." "To the extent that we were concerned that the SEC would come after us, years ago we stopped doing tokenizations," said Lubin. An association and a DAO The token marks a major step toward decentralizing the Linea ecosystem. It comes months after Consensys made a similar move to decentralize core components of its widely-used Infura data platform. Along with the LINEA token, Consensys has announced the formation of the Linea Association, a non-profit tasked with distributing the token and stewarding development of the Linea protocol. Furthermore, "there'll be a DAO [decentralized autonomous organization] and probably sub-DAOs to organize the work," Lubin told CoinDesk. "It'll be lots and lots of tokens, a high percentage of tokens, dedicated to the community." Lubin would not specify how many tokens will be distributed to Linea's community or to other network stakeholders. The DAO will eventually be able to award token grants to Linea contributors. "As people land new innovations for Linea, land products and users and TVL [total value locked] on Linea, there will be programs to award those," said Lubin. Avoiding 'sybil' attacks While tokens have proven a reliable recruitment tool, they haven't always proven durable in the long run. Months after their public debuts, most of the tokens linked to Linea's layer-2 competitors have fallen sharply below their initial price levels. Lubin said he is convinced that LINEA will fare more favorably than similar Layer-2 tokens. In part, this comes down to Linea's user-attestation system, which was designed to suss out individual humans to prevent any single person from spoofing the network across multiple different accounts, thereby accruing tokens to each of them via so-called "sybil" attacks. "When we introduced Linea, very early on we introduced proof of humanity, and we put it as a main element of our point system," said Nicolas Liochon, the head of Linea at Consensys. "Points" refers to the internal scores that Linea uses to track who should receive LINEA tokens. Other tokens have "allocated tokens to many Sybils who had no interest in being productive members of the ecosystem and dumped tokens," said Lubin. "We believe we've taken effective and prudent steps to drastically minimize the number of Sybils that will receive LINEA." https://www.coindesk.com/tech/2024/11/13/ethereum-developer-consensys-plots-token-issuance-in-sign-of-trump-thaw/