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War ‘Just getting Started’—$1 Trillion Crypto Crash Sparks Serious Bitcoin And Ethereum Price Warning

Bitcoin, ethereum and crypto are reeling from shock regulatory crackdowns over the last week that bitcoin and crypto”>some fear is part of a plan to “quietly” ban bitcoin and crypto.

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The bitcoin price has dipped over the last week from year-to-date highs of over $24,000 per bitcoin, dragging down the ethereum price and other major cryptocurrencies and pushing the combined crypto back under the closely-watched $1 trillion level.

Now, despite one legendary trader making a surprise bitcoin, ethereum and crypto u-turn, fears are growing a looming war on crypto “is just getting started.”

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The bitcoin price has struggled to break out of its downward trend over the last few months, with … [+] the ethereum price and other major cryptocurrencies also swinging wildly.

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The U.S. Securities and Exchange Commission (SEC) is gearing up to sue the issuer of one of the largest so-called stablecoins, Paxos, for selling BUSD BUSD as an unregistered security, it was reported by the Wall Street Journal on Sunday.

On Monday, the New York Department of Financial Services (NYDFS) ordered Paxos to stop issuing BUSD, the Binance-branded, third-largest stablecoin that boasts a market capitalization of around $15 billion—though Binance warned the market cap of BUSD will now “only decrease over time.”

“The SEC war on crypto is only just getting started,” Marcus Sotiriou, market analyst at digital asset broker GlobalBlock, said in an emailed note.

Last week, major crypto exchange Kraken was forced to shutter its U.S. staking service after being fined $30 million by the SEC.

SEC chair Gary Gensler, who has previously said he considers almost all cryptocurrencies to be securities that require registration with his agency, that the charge against Kraken “should put everyone on notice who operates in the crypto marketplace.”

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The bitcoin price has climbed off its recent lows this year but remains far below its peak of almost … [+] $70,000 per bitcoin in late 2021.

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However, some crypto market watchers remain upbeat about the prospects for bitcoin, ethereum and other cryptocurrencies, predicting they’ll be tested in coming days and remain chiefly guided by the Federal Reserve’s program of interest rate hikes.

“While bitcoin has shown general resilience in this rally that started on January 1, we are now looking at a key level, which should, in the coming days, indicate whether the rally continues or if we see a steeper correction,” Joe DiPasquale, CEO of BitBull Capital, said via email.

“After losing both $23,000 and $22,000 levels, bitcoin is now making an underside test, which could see it attempting to reclaim $23,000. If this fails, we could see the market leader falling toward $20,000 rather quickly. As usual, the market is also reliant on macro economic developments, and given how December consumer prices were found to be higher than previously expected, the market may start to consider a bigger rate hike in the next [Fed meeting].”

Meanwhile, Brian Armstrong, the chief executive of Kraken rival Coinbase, has said the exchange will “happily” defend its own crypto staking service in court if needed.

“Coinbase’s staking services are not securities,” Armstrong posted to Twitter.

“Regulations are also a concern for the crypto space, especially after the $30 million fine the SEC imposed on Kraken exchange,” DiPasquale added. “That being said, we believe it is better to get regulatory clarity in a slow market, as opposed to stricter developments during a full-fledged bull market.”

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