After the SEC restricted Paxos from issuing the Binance USD in the USA, the global market cap of the cryptocurrency market plunged.
The market cap plummeted after the price of BTC and all the major altcoins declined today.
Investors are also afraid that regulators are once more gearing up for the crackdown against digital currencies.
Amid the regulatory crackdown, cryptocurrencies including Bitcoin (BTC), Ether (ETH), BNB, and some other renowned digital currencies experienced high selling pressure.
The cryptocurrency market which ended the last trading week much high has started the new week on a significant low.
Another important factor that has made the market volatile is upcoming CPI data that is due to be published on Tuesday, Feb 14th, 2023.
It has been argued that CPI and the regulatory actions from SEC together might push the price of Bitcoin (BTC), Ethereum, and other cryptocurrencies further low moving forward.
As of this writing, the market has touched its three weeks lowest point.
Regulators to Intensify Crackdown against Cryptocurrency Market
Investors are afraid that SEC is about to take legal action against Paxos and Binance. This has been the catalyst that successfully brought the market down on Monday.
Moreover, the recent crackdown by SEC officials against crypto staking also played a role in devaluing digital tokens.
As compared to decentralized staking platforms, SEC officials have tracked down central staking protocols such as Kraken.
It seems that Binance and Coin Base are next on the list. Conversely, some decentralized staking platforms have benefited from this crackdown.
But experts said that they are worried that the current anti-staking sentiment of SEC might make the future of the Ethereum protocol uncertain.
As a result of this uncertainty, the market today has become immensely volatile.
By the end of Monday, the global market cap of cryptocurrency was valued at around $1.04 Trillion, a -2.33% decline in its market cap as compared to Friday, last week.
The price of Bitcoin today was $21,633.00, showing a -0.72% decline.
On the other hand, the price of Ether (ETH) fell below $1500 as it was exchanging hands at $1,485.18, this accounts for the decline of 1.99% as compared to its Friday price.
Cryptocurrency Market VS Regulators: Who Emerges As Victor?
The cryptocurrency marketplace and regulators have a long history. But most recently cryptocurrency and regulators have fought each other on two fronts, the demise of FTX and the Ripple vs SEC lawsuit.
It’s expected that Ripple will win the lawsuit against SEC, and the result will be announced later this year.
However, in the case of FTX case, the cryptocurrency has suffered from the fall of FTX very badly in the last two months of 2022.
But most recently the Chairman of SEC Gary Gensler warned:
“If the digital currency market has to survive and thrive then big crypto institutes need to cooperate with SEC over the protection of investors’ funds.”
Gary also added that SEC will not allow the blockchains to use public money for their purposes.
Crypto experts do believe that SEC officials are hiding behind protecting people’s money, but in fact, serving their agenda.
Officials on the other side have a clear opinion that crypto-staking is illegal and unethical, staking allows these platforms to use public money to make their profits.
Recently Kraken has paid a $ 30 million penalty and also declared that they are shutting down their crypto staking operations.
Despite the fact that SEC has forced Kraken to shut down their staking operations and banned Paxos from issuing BUSD.
Binance’s CEO has said that the world’s largest centralized cryptocurrency exchange will continue to carry on centralized crypto-staking.
The CEO Coin-Base USA’s biggest cryptocurrency exchange also said that he will also back staking operations before the court.
Who emerges as the victor and who losses is just a matter of time.
But one thing is certain recent chaos has made the market volatile and investors have already suffered great losses.