Debt Ceiling Debacle, FOMC minutes and Hong Kong opens up Crypto Trading to Retail [Bulls, Bears & Blockchain May 23, 2023]

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Join us on Twitter spaces for today’s Bulls, Bears & Blockchain show, where we’ll be tackling some of the most pressing topics in the financial world.

Be sure to join the conversation as we discuss:

  • Debt Ceiling Debacle
  • New FOMC minutes are scheduled to be released Wednesday afternoon.
  • Hong Kong to Allow Retail Investors to Trade Cryptocurrencies Starting June 1

Don’t miss out on this exciting discussion! Tune in to our live Twitter Spaces show today at 5:30 pm EST and join the conversation.

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Debt Ceiling Debacle – Market Changing its Mind?

The S&P 500 may be close to 52-week highs but traders are cautious ahead of a potential debt ceiling debacle.  Equity funds have seen net outflows for Investors, meanwhile, are seeking safety in long-dated Treasuries.  The options market is also reflecting worries over a debt ceiling impasse: traders are using VIX call options to bet stock volatility will rise at its fastest rate since March 2020.

You can’t make this up:

1. Median Mortgage Payment: $2,800

2. Median Rent Price: $1,850

It now costs nearly $1,000/month more to buy a house than to rent.

Meanwhile, the average new car payment is now at $750/month.

The average interest rate on a used car loan just hit a record 14%.

All while credit card debt is set to cross $1 trillion for the first time ever with record interest rates of 25%.

Basic necessities are becoming unaffordable for Americans.

New FOMC minutes are scheduled to be released Wednesday afternoon.

We’ll get plenty of Fed talk before then with 6 officials (including 4 today) scheduled to speak over the coming days. 

Last Friday, Powell admitted that stresses in the banking sector could reduce the need for further interest rate hikes to fight inflation.  Also on Friday, one of the Fed’s biggest hawks—Neel Kashkari—conceded he was open to a pause/skip at June’s meeting.

Join us today live on twitter spaces for today’s episode of Bulls, Bears & Blockchain as market masters Marc Lopresti and Jon Najarian break it all down.

Hong Kong to Allow Retail Investors to Trade Cryptocurrencies Starting June 1

Bitcoin (BTC) rose to a key price resistance level on Tuesday after Hong Kong announced that it would allow retail investors to trade cryptocurrencies starting June 1.

The Securities and Futures Commission (SFC) of Hong Kong said that it would accept applications from exchanges to offer crypto trading to retail investors from June 1. The SFC added that approved tokens must have a 12-month track record and a substantial market capitalization. The SFC also said that registered exchanges would be barred from providing stablecoin and interest-bearing instruments.

The announcement is consistent with long-held expectations that developments in Asia will catalyze the next crypto bull run. It also contrasts with the lack of regulatory clarity in the West, particularly in the United States.

Bitcoin picked up a bid during the Asian hours and rose more than 2% to $27,500, probing the former support-turned-resistance of the horizontal trendline connecting the first and second trough of the head-and-shoulders (H&S) pattern. The cryptocurrency fell below the trendline early this month, confirming the H&S breakdown and opening doors for a deeper slide toward $25,000.

“This looks like a non-macro-related spot-based move, and the timing coincides with the news that Hong Kong will allow retail trading of BTC and ETH on licensed digital asset platforms as of June 1,” said Noelle Acheson, author of the Crypto Is Macro Now newsletter. “This is not a total surprise – the ruling and the timing were largely expected. But confirmation matters more in a lacklustre market with headwinds coming from other vectors,” Acheson added.

Per Acheson, Hong Kong’s decision to greenlight crypto trading for retail investors does not mean there will be a flood of demand for cryptocurrencies, as local traders are probably already accessing the market through offshore venues. Nevertheless, the announcement is a “a welcome reminder that the crypto adoption pool is likely to grow considerably over the next year and beyond,” Acheson noted.

The announcement from the SFC is a positive development for the cryptocurrency industry and is likely to lead to increased demand for cryptocurrencies in Hong Kong. It is also a sign that regulators in Asia are becoming more open to cryptocurrencies, which could lead to further adoption in the region.

Join us live today on twitter spaces as crypto expert Alex Mascioli takes a deeper dive into these latest developments in the WEB3 space.

Binance Claps Back over ‘Desperate’ Reuters Report which claimed it Commingled Customer and Company Funds

“We’ve addressed this on multiple occasions. We keep our user and corporate funds on completely separate ledgers,” Patrick Hillmann, Binance’s chief communications officer tweeted on Tuesday, though he did not outright deny the report’s claims.

Binance has denied a report from Reuters that the crypto exchange commingled customer funds with company revenue. The report, which cited unnamed “former insiders,” said the funds in question “ran into billions of dollars” and that “commingling happened almost daily” in accounts the exchange had at collapsed U.S. lender Silvergate Bank.

“The allegations in the Reuters report are false and misleading,” Binance said in a statement. “Binance has always maintained strict segregation of customer and company funds, and we have never commingled these funds. We have robust internal controls in place to ensure that customer funds are always safe and secure.”

Reuters said it did not find evidence that clients’ funds were “lost or taken.” However, the report did raise concerns about the exchange’s compliance practices.

“Commingling” or the mixing of customer and company funds is a serious violation of industry standards. It can make it difficult to track customer funds and can increase the risk of fraud.

Binance’s denial of the report comes at a time when the exchange is facing increased scrutiny from regulators around the world. In the United States, Binance is currently under investigation by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC).

The Reuters report is likely to add to the pressure on Binance from regulators. It remains to be seen whether the exchange will be able to convince regulators that it is a safe and compliant platform.

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With so much at stake, it’s crucial to stay informed and involved in these discussions.

Join us today at 5:30 pm EST on our Twitter Spaces, where we’ll delve deeper into each topic, exploring the implications of BJ’s earnings, FED minutes this week, and much much more!

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