The week is behind us, which means it's time for another PointPay Crypto Digest. This time the focus is on Mastercard with USDC payments, Binance news, FED rate hike, new SEC lawsuits and US monetary policy.
Let's find out more!
USDC payments via Mastercard
Mastercard has partnered with Stables and will now offer USDC payment services in the APAC region.
Stables will provide a cryptocurrency wallet that will be linked to Mastercard, allowing cryptocurrency payments to be made quickly and conveniently.
It is noteworthy that any stablecoins will be available for deposit, however, all of them will be converted to USDC without commission and stored further in this form.
It is reported that the project will be launched in 2023 in Australia. Later, services will be provided in Europe, the United States, the United Kingdom and the entire APAC region.
FED meeting results
The FED meeting, which was important for the US economy and cryptocurrencies, took place on March 22. In anticipation of the meeting, the price of bitcoin fell by 3%. The FED's decision this time was influenced by the recent bank collapse and the general pressure on the banking system against this background.
At the end of the meeting it was decided to raise the interest rate by 25 basis points. This was the most popular option among all analysts, so the bitcoin price got its own back and went up.
According to FED head Powell's speech after the meeting, the FED will continue to adhere to the intended policy and raise the rate to reduce inflation. According to him, the US banking system is stable and there is no need to worry. The current goal of the FED is to bring inflation back to the 2% level. By 2024, the goal is to reach 4.3%.
The dual policy of the FED
During the pandemic, the FED greatly expanded its balance sheet and put large amounts of money into circulation. This may have been necessary, but it led to a serious increase in inflation. After almost a year, the FED changed its policy to a stricter one aimed at reducing the money supply and lowering inflation by raising interest rates.
The policy was quite successful for a year until the banks collapsed. In order to resolve the situation and save depositors, the FED hastily increased its balance sheet to half of what it had achieved in one year of strict policy.
At the moment, the FED is trying to pursue a dual policy, keeping it strict through rate hikes, but adding softness through a forced increase in reserves.
Further rate hikes, however, could lead to more banking system crashes, as has already been clearly demonstrated. On the other hand, easing after sctict politicy could cause inflation to rise even further.
Impact of bank collapse on cryptocurrency
Amid the collapse of several banks and the ensuing panic, investors began to withdraw their money from the banking system and invest in other financial instruments. Cryptocurrencies became one of them.
Against the background of the influx of new funds and investments, the price of the top cryptocurrencies went up, overcoming barriers. However, in some time the panic will end and the inflow of new investments will decrease. A possible future scenario would be a price pullback or a slowdown in growth.
However, large investors continue to actively support and develop cryptocurrencies and blockchain technology to further integrate them into familiar processes. Despite the financial difficulties associated with the loss of some funds in collapsed banks, investors see this field as promising and profitable in the long term.
Head of Binance
The week was also memorable with several posts from the head of Binance. First of all, CZ talked about the current situation with stablecoins. He emphasized that BUSD is the most fiat-backed coin of all, as well as being audited by large audit firms and regulated by NYDFS. But all of it couldn't stop regulators.
USDT is much less reliable in this regard, but the regulators have no questions about it. Meanwhile, its capitalization is growing amid falling BUSD and USDC (amid recent problems with banks).
A little later CZ posted another post with the number 4 and a picture of CZ showing 4 fingers. As it turned out, he was alluding to Binance's 4 rule for this year, which is to ignore FUD.
Soon, the media spread the information that Binance employees were spreading the ways to circumvent the restrictions on Binance for the countries where the exchange doesn't officially work. Of course, Binance responded by saying that this was just a rumor and that if violations were found, the employees would be fired immediately.
SEC sues TRON creator Justin Sun
According to the SEC, Justin Sun is accused of selling and promoting TRX and BitTorrent (BTT) tokens. According to the SEC, these tokens are unregistered securities. In addition, it is alleged that the defendants (Sun and the Tron Foundation, the BitTorrent Foundation, and BitTorrent (Rainberry)) "fraudulently manipulated the secondary market for TRX through a scheme of 'extensive sham trading.'"
Justin Sun allegedly had employees make more than 600,000 fictitious TRX trades between accounts he controlled. The daily trading volume ranged from 4.5 million to 7.4 million TRXs.
According to the SEC, Sun targeted US investors' money and inflated TRX trading volumes.
This week was extremely exciting as cryptocurrency prices were heavily influenced by new investors as well as waiting for the FED decision. Now we can see good conditions for growth due to the influx of new investors and the easing of US monetary policy. However, the FED intends to remain strict and the panic that followed the banking collapse should soon subside. The result could be a pullback or stagnation at one level.
The SEC has also made its presence known by continuing to declare various cryptocurrencies as securities. This time, TRX and BTT have caught the regulator's attention. In addition, the SEC claims the existence of a fraud scheme run by Justin Sun.
Binance is also facing charges, as its employees are suspected of distributing ways to circumvent the current blocking scheme in countries where Binance does not operate. CZ warned of the impending FUD on its Twitter feed in advance. Also, the head of Binance spoke on Twitter about the situation with stablecoins, where he pointed out that it looks a bit strange from the outside.
But there was some good news as well. For example, Mastercard made a serious step in the direction of crypto payments. In cooperation with Stable, Mastercard will issue cards with which you can pay for goods and services as usual. However, the funds will be stored in USDC. The first launch will be in Australia, followed by Europe, the US, the UK and the APAC region.
That's it for last week's news. Come back next week for more news and developments in the latest edition of the PointPay Crypto Digest. To make sure you don't miss out, subscribe to our social media where we'll post various PointPay news, including the release of articles!
See you next week!
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