Bitcoin soars on Spot ETF optimism while Binance stops UK sign-ups and Reddit ditches tokens
Data from CryptoCompare shows that the price of the flagship cryptocurrency, Bitcoin (BTC), moved up steadily throughout last week, starting it at around $27,500 and breaking through the psychological $30,000 barrier to now trade above $30,500.
Ethereum’s Ether, the second-largest digital asset by market capitalisation, failed to perform as well as BTC. It started the week off with a drop from $1,575 to $1,550 before surging to test the $1,700 and failed to break through it, now trading at $1,675.
The past week started with positive headlines after the US Securities and Exchange Commission (SEC) chose not to appeal a court decision reversing its denial of Grayscale’s Bitcoin Trust (GBTC) becoming a spot Bitcoin exchange-traded fund (ETF).
In August, a court in Washington ruled that the SEC was wrong to reject Grayscale’s proposal to convert the fund into a spot Bitcoin ETF, which would make it simpler for investors to trade the digital currency.
The SEC did not appeal the court’s decision, meaning the regulator will soon review Grayscale’s application again. This case has been followed closely by the industry, which has been waiting for a decade for such products to be approved.
A spot Bitcoin ETF would allow investors to gain exposure to the cryptocurrency without having to manage their own private keys. Crypto market participants believe that such a product could help bring in mainstream investors into the space. Over the week, Grayscale submitted a new application for a spot ETF.
The SEC also notably dropped its claims that Ripple’s CEO Brad Garlinghouse and Executive Chairman Chris Larsen, helped the fintech firm break federal securities laws by selling XRP, ending a trial that was set for next year.
The SEC’s changing attitude saw the discount on Grayscale’s GBTC diminish by 14.8% in October, to its lowest level since December 2021. The discount narrowed as GBTC outperformed BTC amid hopes it could be allowed to become a spot Bitcoin ETF.
Meanwhile, the European Central Bank (ECB) Governing Council has announced plans to “begin building the groundwork for the potential issuance of a digital euro” by starting a “preparation phase” that follows a two-year investigation.
The ECB said the new phase will commence on November 1, and added that a final decision on issuing a digital currency from the central bank has not been made.
Binance stops accepting new UK users
Leading cryptocurrency exchange Binance has said that it will stop taking new users from the U.K. to follow the country’s rules on crypto advertising. The company said that its users who have passed the “Investor Declaration and Appropriateness Test” can still use its services, but they will not be able to access any new products and services.
The new rules, which came into effect on October 8, allow firms that are registered with the UK’s Financial Conduct Authority (FCA) to approve their own ads. Alternatively, companies can seek approval from authorised entities for their ads, a path other cryptocurrency exchanges use to remain compliant.
While Binance partnered with a peer-to-peer platform called Rebuildingsociety.com, the FCA said the firm wasn’t authorised to approve crypto ads.
Over the week, Binance’s American entity, Binance.US, also updated its terms to reflect that the US dollar funds users have on the platform are no longer protected by deposit insurance from the Federal Deposit Insurance Corporation (FDIC). The exchange also halted U.S. dollar withdrawals.
Reddit to shut down blockchain-based community points feature
The week also saw Reddit announced a phase-out of its blockchain-powered Community Points, which are distinct blockchain tokens allocated to members of its r/CryptoCurrency, r/Ethtrader, and r/FortniteBR communities.
The disclosure, made by a Reddit staffer on the site, triggered a notable sell-off of the tied tokens – encompassing r/CryptoCurrency’s Moons, r/FortniteBR’s Bricks, and r/Ethtrader’s Donuts. Some on Reddit pointed out transactions that took place shortly before the disclosure, suspecting them to be dubious.
The discontinuation of Community Points is scheduled for November 8, due to Reddit’s expressed challenges in scaling this feature broadly across the platform, coupled with a regulatory climate that further “added to scalability limitations”.
Meanwhile, the main entity behind leading decentralized cryptocurrency exchange Uniswap, Uniswap Labs, introduced a 0.15% fee on trades involving tokens like ETH and USDC on the front end of the exchange it controls.
The fee is distinct from the “protocol fee” overseen by governance votes and is meant to support Uniswap Labs’ operations.
Francisco Memoria is a content creator at CryptoCompare who’s in love with technology and focuses on helping people see the value digital currencies have. His work has been published in numerous reputable industry publications. Francisco holds various cryptocurrencies.
Featured image via Unsplash.