Large investment in bitcoin, miner price volatility and tighter regulation

This week was marked by a change of "bullish" sentiment to "bearish". On December 9, the bitcoin rate fell by 5% per day and was trading at $18,300, the daily minimum was at around $17,640. Other top cryptocurrencies also appeared in the red zone. Perhaps the reason for the fall was the significant volumes of BTC on the exchanges that put up the whales for sale.

On December 11, Bitcoin again lost value and traded at $17,616.

Despite this, Glassnode sees "bullish" metrics that can trigger the growth of bitcoin tenfold. Note that bitcoin was in a position above $19,000 for seven whole days, while in 2017 it was only three days.

All stocks of ASIC miners, as well as their production line, have been sold out until May 2021, which is why their demand in the secondary market has intensified. With the increase in the price of BTC by 166% for the current year, all devices were sold out, buyers showed special interest in the 19th series of Bitmain. The volatility of prices for used devices is no worse than the volatility of the price of bitcoin itself: recently, prices for used ASIC miners of previous generations have increased by 40-50%.

CryptoQuant analysts believe that bitcoin cannot overcome the $20,000 mark due to sales by miners. Expecting a further fall in the exchange rate, they began to sell their impressive stocks of BTC and from this the price of bitcoin may still decrease.

Massachusetts Mutual Life Insurance has invested $100 million in bitcoin, as well as $5 million in the authorized capital of New York Digital Investments Group. The company provides insurance services for 5 million customers. The reason for buying cryptocurrencies was the growing inflation rate of the dollar. In total, over the past week, institutional investors made investments in cryptocurrency funds and exchange-traded products in the amount of $429 million, and the total value of crypto assets under management reached $15 billion (CoinShares data).

Wall Street financial giants S&P Global and State Street Corp. we also invested in the cryptocurrency industry. $15 million went to the cryptocurrency data provider Lukka, which developed a set of tools for tax accounting in the crypto industry.

MicroStrategy is investing in digital gold again, this time using debt funds in the amount of $650 million.

At the G7 conference, they reacted to the change of the name of the Libra Association to the Diem Association. The German Ministry of Finance believes that Facebook's cryptocurrency rebranding is not enough for regulators to allay their concerns:

«A wolf in sheep's clothing remains a wolf. It is clear to me that Germany and Europe cannot and will not agree to accept its entry into the market until regulatory risks are properly eliminated».

The head of Facebook's blockchain division, David Marcus, predicts the launch of Diem together with the Novi cryptocurrency wallet next year.

The member countries of the Big Seven (G7) see the need to regulate cryptocurrencies. In their opinion, this is necessary to prevent the use of digital assets in illegal transactions. It is equally important for regulators to respond promptly to all the changes in the cryptocurrency industry that are happening so rapidly.

France wants to tighten regulation of the cryptocurrency industry after recent terrorist attacks. With the help of cryptocurrencies, funding is received for terrorist groups, including from Turkey and Syria. The French Ministry of Finance has prepared a package of documents tightening the requirements for KYC, as well as assuming mandatory registration of all cryptocurrency exchanges. This resolution does not require adoption by Parliament. After that, France will become the jurisdiction with the strictest regulation of cryptocurrencies: the amount of the transaction, which will require identification, will decrease from 1,000 euros to just 1 euro.

Russian officials will now report on the ownership of cryptocurrencies. In order to submit reports, six months are allotted — the deadline for filing a declaration is June 30, 2021. In the information, you must specify the name of the digital asset, the date of acquisition, the total amount and data about the operator of the issued asset.

The country also has a Committee on Digital Financial Assets and Digital Currency. A new organization under the Council of the Digital Economy Development Fund will deal with the regulation of cryptocurrencies, as well as their taxation. President Vladimir Putin called for active actions to digitalize the state in order to remain competitive on the global market.

Paxos, which already has permission to store fiat money and gold, provide cryptocurrency services and other services, has applied for a license from the US federal bank. Similar applications have already been submitted by cryptocurrency companies BitPay and Anchorage. A major cryptocurrency payment operator BitPay claims to be registered as a national bank and will be named BitPay National Trust Bank.

Fidelity will launch a cryptocurrency-backed lending service. Thus, investors will be able to borrow in fiat currencies using BTC as collateral. To get a loan, clients of a financial company need to open an account with a BlockFi partner company. The new service is intended mainly for hedge funds, cryptocurrency miners and over-the-counter trading platforms.

Previously we wrote: Ten-year crypto-assets worth millions of dollars