Crypto Market in Recent Days
In recent days, events in the crypto world have been more dynamic on social media than on price charts. From regulatory actions in the United States and Europe to institutional investments in Bitcoin, there has been no shortage of changes.
Regulatory Changes and Their Impact
U.S. regulatory agencies have shifted, bringing a new approach to the crypto industry. The SEC has initiated new actions, with KuCoin already reaching a settlement with the institution. A similar outcome is expected for Ripple, although, at the time of writing, no settlement has yet been reached.
Meanwhile, France is planning a more detailed investigation into Binance to determine potential illegal activities. However, instead of targeting individual users who violate laws, French regulators are focusing on the entire platform, which may not be the most effective way to address irregularities.
Europe continues to tighten regulations. For instance, Crypto.com will be required to remove USDT by January 31, 2025, signaling further restrictions on financial instruments that could offer investors higher profits.
Additional pressure also comes from France, which is introducing the “unproductive wealth” tax in its 2025 budget. This policy aims to tax unrealized gains, meaning Bitcoin holders will be taxed on its value even if they haven’t sold it. If the price drops, the loss is borne solely by investors, while the state always remains in profit.
Reserve Debates and Bitcoin’s Dominance
In the United States, a debate is ongoing about which cryptocurrencies should be included in official reserves. The discussion involves supporters of Bitcoin, Ethereum, and Ripple, although holding tokens issued by private companies could create opportunities for manipulation and corruption.
Unlike centralized projects, Bitcoin remains maximally decentralized and transparent. No central institution can “print” new Bitcoins, nor can anyone manipulate its supply. For this reason, filling state reserves with Bitcoin would be the most logical choice.
Institutional Investments in Bitcoin
Despite regulations and debates, major companies continue to buy Bitcoin. Japanese firm Metaplanet plans to invest $870 million in the cryptocurrency, while Senator Cynthia Lummis has proposed that the U.S. purchase 200,000 Bitcoins annually over five years to strengthen its financial reserves in the long term.
Additionally, BlackRock and other major institutions are now demanding the introduction of an “in-kind redemptions” mechanism for Bitcoin ETFs. This change would allow investors to receive Bitcoin instead of dollars when exiting ETFs, further stabilizing the value of the leading cryptocurrency.
Market Stability and Lack of Retail Investors
Although January is traditionally a month of reduced investor activity, an additional factor is now at play: inflation has increased the cost of living, while wages have not risen at the same rate. This means that average investors have fewer funds to invest in crypto. Moreover, after recent market turbulence, many remain cautious, focusing more on when to sell rather than when to buy.
USDC Expansion and Solana
One of the most interesting market indicators is the increased issuance of the USDC stablecoin. Just a month ago, there were 43 billion USDC in circulation, while today that number stands at 53 billion. A significant portion of these new tokens has been issued on Solana, potentially signaling major developments and growth within this ecosystem.
Conclusion
In recent days, the crypto industry has faced numerous regulatory challenges, institutional investments, and discussions about the future of reserves. While the situation differs between the U.S. and Europe, it is clear that the crypto market continues to evolve, bringing both uncertainties and significant opportunities.
As these changes unfold, we will see what long-term impact they will have on the industry and investors.