Bitcoin Drives Crypto Rebound
The cryptocurrencies increased their gains by more than 3% overnight to reach a market capitalization of $1.08 trillion. The gains came despite lackluster trends on Wall Street as well as dollar strength reflected in a higher dollar index.
Overnight gains for market leader Bitcoin came in at 7.4%, allowing the major cryptocurrency to trade at $23,801.92. BTC has been swinging between a high of $23,877 and a low of $22,106 over the past 24 hours.
Among the top 100 cryptos, only Dogecoin (DOGE) ranked 10th, Lido DAO (LDO) ranked 75th, Shiba Inu (SHIB) ranked 15th, and Flow (FLOW) ranked 31st saw better overnight performance. DOGE reportedly won on some whale trades.
Ethereum’s overnight gains to #2 were more modest at 3.5%. Ether traded between $1,607 and $1,517 in the past 24 hours. ETH is currently trading at $1,595.
Contrary to weekly performance, Ethereum gained 53% while Bitcoin only rose 24%.
Tether (USDT), ranked 3rd, traded between $1.00 and $0.9999 in the past 24 hours.
The 4th ranked USDCoin (USDC) traded between $1.00 and $0.9994 in the last 24 hours.
The 5th ranked BNB (BNB) has gained just over 2% in the past 24 hours and over 22% in the past week.
The 6th ranked XRP (XRP) gained more than 3% overnight.
Cardano (ADA) jumped a notch with a 5% rally overnight, relegating BinanceUSD (BUSD) to 8th position among all cryptocurrencies. BUSD traded between $1.00 and $0.9983 in the past 24 hours.
Solana (SOL), 9th, missed the rally and lost more than 2% in the last 24 hours. However, among the top 10 cryptos, Solana’s weekly gain of 40% ranks second, behind Ethereum’s gain of 53%.
Arweave (AR), ranked 79th, Ethereum Classic (ETC) ranked 24th, and Compound (COMP), ranked 85th, lost more than 4% overnight despite the widespread market rally.
Meanwhile, crypto lending platform Celsius, which filed for bankruptcy on July 13, declared a recovery plan in which it revealed plans to use bitcoin hit by mining operations to help fund mining operations and developing bitcoin holdings. The recovery plan also shows that customers would have the option, at the customer’s option, to cash back or go crypto “long.”
The legal outcome of the bankruptcy proceedings involving Celsius, the lender that reported a $1.2 billion deficit in its balance sheet, would be closely watched by the crypto world. The massive turmoil in the crypto world has also rocked crypto broker Voyager Digital, hedge fund Three Arrows Capital as well as various other crypto market entities.
A key legal issue at the end of the case is whether the crypto assets in possession of Celsius are the property of the estate. The status of crypto assets held under the Custody vs. Earn as well as crypto assets transferred to Celsius to secure institutional and retail loans would also be subject to legal review.
If customers are entitled to the return of crypto in kind, the date when the crypto claim would be determined (e.g., petition date, effective date, or distribution date), the exact meaning of ne not infringe a crypto claim or pay a crypto claim in full are all issues that should be thoroughly investigated from a legal perspective.
Other points for legal scrutiny include, among Celsius entities, customers have claims, and whether retail and institutional borrowers have a right of set-off when they (a) have borrowed money, stablecoins, or coins. other cryptos to Celsius and (b) transferred crypto to Celsius. Also relevant is whether Celsius can recover customer withdrawals or loan liquidations made within 90 days of deposit as preferences.
Meanwhile, Skybridge Capital announced a temporary halt to withdrawals from its Legion Strategies Fund, citing exposure to crypto. The move was confirmed by founder Anthony Scaramucci.
Despite the bankruptcy crises, the momentum in the crypto market continues amid concerns over whether the recent rally signifies a bull market or a bull trap.
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