Coinbase Premium Tanks to an All-Time Low During Bitcoin Sell-Off

But soon it skyrocketed to nearly +$500.

The price of cryptocurrencies continued its downwards journey until a good bunch of longs was liquidated, and the price of Bitcoin went under $50k.

BTC went down as low as $48,250, down 27.5% from Sunday’s all-time high around $58,300.

With this latest dip, the leading digital currency has turned the old ATH of $46,700 into new support, noted analyst and trader Rekt Capital. However, the trader says this is not a Bitcoin correction because, historically, the trend tends to between 30% to 40%.

“But there are many more dips along the way which are much shallower than -30%,” added Rekt Capital.

This pullback pushed Coinbase Premium, the gap between Coinbase Pro price (USD pair) and Binance price (USDT pair) to an all-time low of -$1,020. Soon after, this premium skyrocketed to +486. Coinbase whales are actually the ones driving the market, and they took this opportunity to accumulate more BTC.

MicroStrategy and Tesla also availed Coinbase’s services to make their Bitcoin purchases.

This means, “Even if there are more corrections, it’s unlikely to go down below 44k,” said Ki Young Ju, CEO of CryptoQuant.

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Source: CryptoQuant

While after a wild rally that pushed us past the $1 trillion dollar market cap, correction is sometimes expected, we are also to blame for this correction because last week, the Crypto Twitter (CT) went crazy with red lasers, quipped another trader Josh Rager.

What actually exacerbated this sell-off was the degens that were trading with high leverage. In the last 12 hours, $3.64 billion worth of liquidation happened. In the past 24 hours, it was nearly $4 billion, as per Bybt.

Binance lead in these liquidations, accounting for $1.58 billion of them, followed by Huobi ($878.53 million), OKEx ($426.63 million), and Bybt ($322.49 million). Bitfinex and Deribit saw the least amount of liquidations at 8.74 million and $55.14 million, respectively.

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Source: ByBt

The liquidation helped the funding rate on BTC perpetual contracts to come down between 0.0068% on Deribit and 0.0686% on Binance. On OKEx, funding is negative.

For now, the market has recovered from the lows as Bitcoin now trades around $52,644.

Amidst the red market, good news came from Vancouver-based cannabis company Vinergy that announced the expansion of its investment policy to include Bitcoin and cryptocurrencies as the “influx of investment and increased institutional adoption is creating a highly lucrative opportunity.”

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Author: AnTy

Interactive Brokers to Settle $38 Million in Penalties for Violating AML Procedures

Interactive Brokers LLC, a U.S based brokerage that skyrocketed between 2013 and 2018, has agreed to settle a total of $38 million with the SEC, CFTC and FINRA for violating AML practices. The brokerage had risen ranks within a span of five years to feature amongst the big players within the U.S industry. It also cleared more foreign institution transactions compared to other brokerages in the U.S at the time. Following settlement agreement, it now seems that the brokerage is ready to face to the music for neglecting proper AML procedures.

Notably, all the three financial watchdogs released a press release in light of the penalties imposed on Interactive Brokers LLC. Finra is set to receive $15 million while both the SEC and CFTC expect $11.5 million each from Interactive Brokers LLC. At the core, all the oversight bodies agree that Interactive Brokers failed in a number of instances in maintaining their KYC role as financial services provider. These sentiments were brought to light from different financial oversight perspectives but ultimately narrowed down to AML inefficiencies.

Finra particularly noted that Interactive Brokers did not surveil hundreds of millions of funds that were deposited with them, including those from countries perceived as ‘high risk’ by the U.S. It went to add that the brokerage was also under staffed, an issue that was raised in relation to report reviews but was not considered early enough. Furthermore, the Interactive Broker internal and external policies were also not well in tune to provide proper guidelines to stakeholders on how they should execute roles in compliance.

SEC on the other hand said that Interactive Brokers failed to file Suspicious Activity Reports (SARs) despite its underlying exposure to regulatory risk. It, therefore, made it difficult for the regulator to track suspicious activity in the dealings of Interactive Brokers. Marc Berger, SEC’s New York Regional Office Director has since noted that this is an important function and ought to have been fulfilled by Interactive Brokers,

“SAR filings are an essential tool in assisting regulators and law enforcement to detect potential violations of the securities laws, particularly in the microcap space.”

The CFTC’s basis was almost similar to SEC’s claims on failure to report SARs; this U.S Commodity Futures Trading Commission charged Interactive Brokers for slacking in checking its stakeholders who include agents, employees and officers. Other than the $11.5 million penalty, CFTC also ordered Interactive Brokers to disgorge $706,214 which was earned in a transaction where the regulator later moved to enforce action on the counterparty.

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Author: Edwin Munyui