Bitcoin Recovers to Above $20,500 While Ethereum Hits $1,156 – Miners Offload BTC
On Saturday, June 18th, intense fear led to sell-offs that forced the price of Bitcoin down to $17,700. Bitcoin has since turned green, gaining 6.5% over the last 24 hours to trade as high as $20,900 on Monday, June 20th.
Ethereum has been on a better rally than Bitcoin, having gained 8.9% over the last 24 hours, with the price of Ethereum (ETH) shooting up to $1,156 from an interday low of $1,025. Ethereum now trades at $1,150 at the time of writing.
The 24 hour price chart for Ethereum (ETH). Source: CoinMarketCap
The price surge saw Bitcoin and Ethereum take critical support levels that could act as the backdrop for further recovery.
Solana Community Votes to Take Control Of Whale Accounts
Solend, a Solana-based lending and borrowing decentralized finance (DeFi) platform, has voted to take control over the protocol’s largest whale account in a bid to “mitigate liquidation risks.”
Solend explained the situation thus: “If SOL drops to $22.30, the whale’s account becomes liquidatable for up to 20% of their borrowings (~21M).” According to Solend, the whale has been unresponsive to on-chain messages.
Solend expressed that it would be difficult for its market to absorb such an impact as liquidators generally market sales on DEXes.
With the majority of the community voting in favor of the motion, Solend Labs has gained “emergency powers” over the whale account, allowing it to liquidate vulnerable assets in over-the-counter trades, rather than through the use of decentralized exchanges.
Albeit through unconventional means, Solend claims to be seeking to protect the protocol and its community from liquidation risks.
MakerDAO Votes to Suspend Aave DAI Deposits to Reduce Celsius Exposure
MakerDAO, the organization behind the DAI stablecoin, has temporarily suspended operations involving the minting and deposit of DAI on the Aave crypto lending platform following a governance vote held on June 15th.
After a unanimous vote in favor, MakerDAO deactivated the ‘DAI Direct Deposit Module (D3M)’ on June 17th as part of an effort to reduce exposure to embattled crypto lending platform Celsius Network,
The Target Borrow Rate was set to 0 in the smart contract responsible for D3M, and the suspension restricts any further borrowing by Celsius through Aave’s D3M.
Celsius has over 100 million DAI collateralized by its stETH. If the lender becomes insolvent, it would likely dump its stETH—causing it to depeg further from ETH. In the event that this happens, MakerDAO’s 100 million DAI loans to Celsius would be rendered irrecoverable.
Suspending deposits will prevent any further borrowing of DAI with stETH, thus limiting potential losses if Celsius indeed reaches insolvency.
Binance Suspends Withdrawals and Deposits in Brazil – Hoo Suspends Withdrawals
Binance, the world’s largest crypto exchange by trade volume, has announced the suspension of deposits and withdrawals in Brazil. The cessation of services will be applied to the government’s payment system, Pix, on Friday.
In its official announcement, Binance revealed that it had terminated a partnership with Capitual. The local payment gateway had been facilitating Binance services via Pix for the past twenty months.
In similar news, Hong Kong-based crypto exchange Hoo.com has suspended all withdrawals on its platform. Hoo cites a transaction overload as the main cause, as investors swarmed to retrieve their funds in light of the collapse of Three Arrows Capital.
Hoo announced that it would resume transactions within 72 hours, claiming that the exchange needs the time to “process a large number of users’ withdrawal demands and ensure the safety and accuracy of withdrawal assets.”
The halting of services coincides with the deadline imposed by the Central Bank of Brazil for Pix providers to implement new KYC requirements.
South Korea Delays Crypto Tax by Two Years, Now Set to Come into Effect By 2025
In May, South Korea’s newly elected President Yoon Suk-yeol had initially announced the postponement of South Korea’s crypto tax to 2023. However, the imposition of tax on crypto gains has now been pushed back a further two years.
South Korea’s Ministry of Economy and Finance Tax Policy Chief Ko Kwang-Hyo announced on Thursday, June 16th, that the taxation of crypto gains would only come into effect starting on January 1st, 2025.
The eventual deployment of the crypto tax will be part of Korea’s ‘Digital Assets Basic Act‘, and will regulate the issuance and listing of cryptocurrencies.
The proposed tax, which was originally expected to come into effect in 2022, would have levied a 20% tax on crypto gains worth over KRW 50 million ($38,624 USD) made within a period of one-year.
South Korea intends to impose a tax on cryptocurrencies only after preparing a sufficient level of market infrastructure for the asset.