The crypto market has been on a downward trend in the past week as the US and Nigerian Securities and Exchange Commissions took a stricter stance against crypto exchanges for offering unregistered securities. This caused Bitcoin miners to speed up their selling rate, while the altcoin market witnessed a sharp drop in liquidity.
However, some positive news came from the European Union in the form of the MiCA (Markets in Crypto-Assets) legislation being published in the Official Journal of the European Union. Additionally, Hong Kong opened up to Chinese investors, providing an influx of liquidity into the crypto market.
This week’s volatility is expected to be further aggravated by the US Federal Reserve’s interest rate decision on Wednesday. Moreover, US President Joe Biden and House Speaker Kelvin McCarthy have reached an agreement on the debt ceiling, which was passed by the Senate and Congress. As a consequence, the US Treasury Department is set to issue approximately $700 billion worth of short-term T-bills to refill its Treasury General Account (TGA).
The effect of this will be a decrease in liquidity in digital assets, as they are perceived as risky investments. According to an analyst from Coin Bureau, the TGA refill will put pressure on major stablecoins such as Tether USDT, DAI, and Circle USDC.
