Bitcoin Rises, Cryptos Savor FOMC Data


Good morning. This is what is happening:

Prices:

CoinDesk Market Index (CMIP)

837.58

+12.1 1.5%

Bitcoin (BTC)

$16,820

+107.3 0.6%

Ethereum (ETH)

$1,253

+28.2 23%

S&P 500 daily close

3,852.97

+28.8 0.8%

Prayed

$1,862

+9.0 0.5%

Treasury Yield 10 Years

3.71%

0.1

BTC/ETH prices for CoinDesk Indices; gold is the COMEX spot price. Prices starting at 4 pm ET

Perspectives: Square Enix has pledged to invest in Web3, but the Japanese gaming company faces an uphill battle given the country’s strict rules on anything resembling gambling.

Prices

Favorable economic conditions create a flat market

By Sam Reynolds

By all accounts, the Fed’s moves to curb inflation are working, and that has been good for cryptocurrencies.

Bitcoin started the day in Asia fairly flat, up 1.2%, trading at $16,851 based on CoinDesk pricing data. Ethereum rose 3.46%, coming in at $1,254.

But the question is, has inflation peaked? Will the Fed ease up on raising interest rates?

recently published proceedings of the Federal Open Market Committee do not paint a clear picture of what is to come. The Fed calls price increases stubborn, saying it “proves to be more persistent than anticipated,” while raising interest rates another half percentage point.

A smaller increase than the three-quarter percentage point increases of earlier, indicative that inflation has peaked, but yet another rate hike.

“In general, participants noted that a tight policy stance would need to be maintained until incoming data provided confidence that inflation was on a sustained downward path to 2 percent, which would likely take some time,” the minutes said. “In view of the persistent and unacceptably high level of inflation, several participants commented that historical experience cautioned against premature easing of monetary policy.”

The minutes also say that despite the need for a continued restrictive policy stance, flexibility is also on the agenda.

“Most participants emphasized the need to maintain flexibility and optionality when shifting policy to a more restrictive stance,” suggesting that the next interest rate increase could be a quarter of a percentage point, or 25 basic points.

Before the tumultuous year that was 2022 for cryptocurrencies, interest rate hikes were seen as a problem by digital asset traders; its price pressure for bitcoin and ether, which are seen as risky assets like technology.

But now that the Federal Reserve is lowering interest rates and the market has eliminated the trifecta of toxins that is Terra, Three Arrows and FTX, a price recovery should be on the cards. If there is no other black swan event.

biggest winners

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perspectives

Square Enix uphill commitment to invest in Web3

By Sam Reynolds

Japan’s gaming industry has produced some of the world’s most recognizable intellectual properties with its best-selling franchises.

But corporate Japan is known for its caution and conservatism; The likes of Nintendo and Sega have shown no interest in Web3 or NFT gaming. nintendo has aggressively defended its intellectual property against those who have tried to hijack it for crypto games.

Square Enix is ​​a rarity for the country, since the president of the company, Yosuke Matsuda recently committed the game company to invest in Web3.

“In terms of new business domains, we named three focus investment fields in our medium-term business plan.” Matsuda wrote in a blog post.. “Among them, we are most focused on blockchain entertainment, to which we have devoted aggressive investment and business development efforts.”

Although Square Enix isn’t as big as Nintendo or Sega, among Japanese RPG gamers, the company has a lot of influence. Officially licensed Non-Fungible Tokens (NFTs) of some of Square Enix’s most well-known characters, like Sephiroth from Final Fantasy VII or Cloud Strife, would definitely be a hot item among fans.

A likely clash with regulators

But Square Enix will face regulations in Japan that many legal experts believe would be hostile to Web3 games, classifying them under the country’s gaming framework.

“In the case of blockchain gaming, gaming laws also need to be considered,” Tokyo-based law firm So & Sato wrote in a 2021 review of how Web3 gaming and gaming laws intersect. Japan. “Blockchain games that include user incentives, such as free NFT issuance, must comply with the Premiums and Representation Act.”

The Premiums and Representations Act, So & Sato wrote in an article, regulates the free provision of goods and services by a company that is intended to induce potential customers to buy the company’s products or services.

What CoinDesk previously reported, Axie Infinity’s game structure would constitute gambling based on So & Sato’s analysis. “Since a user must pay a certain amount of soft love potion [or SLP, an in-game token] to breed new randomly generated Axies, there is a possibility that breeding new Axies could be considered illegal gambling,” the firm wrote. In-game tournaments, which require an entry fee, would also fall into this category.

To be sure, playing to win is just one type of Web3 game, and a dying one. by ubisoft (unsuccessful) foray into Web3 games involved selling collectible skins for use in one of their Ghost Recon games. But the market didn’t seem all that keen on the prospect, though that might change when it comes to recognizable Square Enix characters.

NFT and the unknown

If blockchain gaming for Square Enix just means collectible NFTs for character skins are added to a normal game, that’s probably okay under Japanese law.

“It is understood that NFTs are not subject to financial or trade regulations under the Financial Instruments and Exchange Law, Payment Services Law, or other Japanese laws,” Japanese law firm TMI Associates wrote. in a recent article.

TMI Associates cautions that much is unknown about how NFTs would be viewed by courts in the event of a dispute, as their legal status has yet to be proven.

“While NFTs have hidden possibilities as a new content distribution medium, their structure and legal positioning are not necessarily known at this time,” the firm said.

This huge unknown is probably why wary Japanese corporations like gaming giants Nintendo and Sega haven’t gotten into the space yet.

Important events.

21:15 HKT/SGT (13:15 UTC) ADP US Employment Changes (December)

21:30 HKT/SGT (13:30 UTC) Canada International Merchandise Trade (November)

22:45 HKT/SGT (14:45 UTC) United States S&P Global Composite PMI (December)

Coin Desk TV

In case you missed it, here’s the latest episode of “First Engine” on Coin Desk TV:

Sam Bankman-Fried Trial Date Set; Ethereum Shanghai Update: What’s at Stake

“First Mover” dove into today’s hot topics in crypto, including US-Bahamian liquidators fighting for jurisdiction over bankrupt cryptocurrency exchange FTX and Sam Bankman-Fried pleading ‘not guilty’ ‘ of the fraud charges. 507 Capital managing partner Thomas Braziel weighed in. Also, a closer look at the Ethereum upgrade in Shanghai. Why are you pushing for liquid staking governance tokens and what does it mean for ETH participants? And, an update on the crypto markets as bitcoin and ether prices inched higher. OANDA Senior Market Analyst Edward Moya and Messari Research Analyst Kunal Goel joined the conversation.

Headlines

Crypto Broker Genesis CEO Tells Clients He Needs More Time To Work Out Finances: Genesis halted withdrawals in November in the wake of the FTX crash.

Ethereum in 2023, here’s what to expect: Staked ETH withdrawals, scalability, and more cool events are on the horizon for Ethereum.

The UK’s top crime agency is assembling a team of crypto experts: The National Crime Agency posted a job for “cryptocurrency investigator.”

1,000% for Solana Liquidity Providers: The meme coin is up more than 150% in the last 24 hours and has recorded some of the highest trading volumes on Solana-based decentralized exchanges.

A dose of ‘Hopium’ for 1970s Bitcoin Bulls: US inflation has slowed in a move analogous to the late 1974 CPI peak that heralded a rally in the S&P 500, a benchmark for risk assets. Some observers, however, see limited upside for bitcoin.

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