This week in parts. Illustration by Mitchell Preffer for Decrypt.
Most of the top thirty cryptocurrencies by market capitalization have risen in value over the past seven days, with Bitcoin (BTC), Solana (SOL) and Internet Computer Project (ICP) leading the rally.
Bitcoin is around 7.5% more expensive than it was last weekend and is trading for $29,295 at the time of writing.
On Monday, the world's favorite cryptocurrency fell to $27,500but on Wednesday he recovered $29,000 after another potential insolvency shook the world of traditional finance; First Republic Bank shares dropped 50% Tuesday, a day after its latest quarterly report revealed a sharp drop in deposits.
Ever since the Bitcoin whitepaper, crypto has been introduced to the world as an alternative to the banking system. So when TradFi institutions are struggling, investors often flock to crypto, as happened last month when news of Credit Suisse's insolvency pumped the price of bitcoin.
The second largest cryptocurrency in the market, Ethereum, only managed to add 2.7% to its value this week and is currently trading at $1,906.
The biggest rallies among major cryptocurrencies came from Solana, which rose 11% and is now worth $23.35, and ICP soared 16.6% to change hands at $6.58.
Holders of Cosmos Hub (ATOM) saw their reserves rise this Saturday as the token rose 8.5% over the week to trade at $11.68.
The glare from regulators' headlights has intensified recently as U.S. agencies like the Security and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) continue to take enforcement action against the industry in lieu of new guidelines.
On Monday, Democratic and California lawmaker Matt Haney introduced Assembly Bill 1229a legal framework for Decentralized Autonomous Organizations (DAOs) that would amend state law to allow DAOs to incorporate and pay taxes in California while providing better safeguards for Californians participating in the web economy3 .
The bill already has the backing of crypto investment firm Andreessen Horowitz and the Crypto Council for Innovation.
On Tuesday, news broke on Twitter that Binance US had went away of a deal to acquire the assets of crypto lender Voyager, one of the most high-profile victims of Terra's collapse last May. In a statement to Decryptthe exchange cited "the hostile and uncertain regulatory climate in the United States" as the primary factor behind the decision to terminate the deal.
Wednesday, reports emerged that Binance CEO Changpeng Zhao had lawyers hired to defend against multiple legal threats filed against him and his exchange by the SEC, CFTC and the Department of Justice.
That day, cryptocurrency-friendly Texas Senator Ted Cruz went on a rant against the idea of a US central bank digital currency (CBDC) during the Bitcoin Policy Summit.
CBDCs are currently being researched by governments around the world, including those in the US and EU. A CBDC is a stablecoin pegged to the local currency, and proponents say it would facilitate online payments while taking advantage of blockchain features like instant settlement and smart contracts. However, critics fear the result will lead to increased centralized control over our money, which goes against the very philosophy of crypto.
Cruz argued that US leaders would use a CBDC “to destroy any value of Bitcoin, to destroy anonymity, to destroy decentralization. He added, “The same people who want to see a CBDC, they hate bitcoin and they hate cash. Let's be clear; they don't like cash for exactly the reason I like cash because it's not under centralized control that's not under constant surveillance. And so hopefully we'll see growing resistance to a CBDC.
CBDC skepticism is prevalent in Republican circles. Last month, Florida Governor Ron DeSantis and Ohio Rep. Warren Davidson echoes Cruz's sentiments.
Finally, at a Thursday Bloomberg EventHong Kong Securities and Futures Commission (SFC) CEO Julia Leung has announced that the special administrative region will launch its crypto licensing regime next month.
The new rules promise to allow retail investors to trade major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) with fewer restrictions from June 1st.