bcSEC and CFTC issue new cryptoasset classification framework
S&P Dow Jones Indices licenses S&P 500 to Trade[XYZ] for perpetual contracts on Hyperliquid
After being as high as $76,000 last Tuesday, bitcoin has seen a sell-off and is currently back trading around below the $70,000 level.
Wednesday’s hotter-than-expected producer price index data from the US sparked the drop, as well as Chairman Powell’s press conference later on that day where his more hawkish tone and indication that rising oil prices could be an inflation risk, dampened sentiment, Simon Peters, cryptoasset market analyst at multi-asset investment platform eToro,.
Markets are now forecasting the Fed to hold rates this year, and well into 2027. However, the longer the conflict in the Middle East continues, and if oil prices stay high, driving up inflation, we could well see interest rate hikes. This scenario wouldn’t bode well for cryptoasset prices, given what we’ve historically observed when financial conditions tighten.
Looking ahead this week, there is speculation growing regarding the potential signing of the CLARITY Act. The White House and US lawmakers have reportedly reached a tentative deal on stablecoin yields to advance the crypto market structure bill. The proposal would limit interest on passive holdings to protect traditional banks from deposit flight, but allow yield to be earned if tied to specific activities such as payments, transfers and trading.
This is a significant milestone for the US crypto industry and resolves months of dispute, during which the future of CLARITY had appeared uncertain. If the framework is signed into law, it could provide a major catalyst for cryptoasset prices to move higher.
BIGGEST MOVERS
Due to their higher beta versus the overall crypto markets, memecoins such asv$PEPE and $PENGU were the biggest losers last week, losing 20% in some cases amidst the wider sell-off following the hotter-than-expected PPI data.
Discover more here: https://www.etoro.com/discover/markets/cryptocurrencies/market-movers
EYE-CATCHING STORIES
SEC and CFTC issue new cryptoasset classification framework
The US SEC and CFTC jointly issued a new 68-page cryptoasset classification framework last week, determining that most major cryptoassets such as bitcoin, ethereum, solana and XRP are to be considered digital commodities and not securities.
In total, 16 cryptoassets are now classified as digital commodities under federal law, meaning they are now under the primary jurisdiction of the CFTC and not the SEC.
As well as digital commodities, the other categories include digital collectables such as NFTs, digital tools, payment stablecoins and digital securities – tokenised versions of traditional stocks and bonds that would be classed as securities under the new 5-part token taxonomy.
The classification of cryptoassets as digital commodities, combined with the generic listing standards approved in September last year, could now lead to an accelerated timeline for spot ETF approvals. This, in turn, could lead to significant inflows into the cryptoasset sector as well as potentially driving the prices of the underlying cryptoasset prices higher in the months and years to come.
S&P Dow Jones Indices licenses S&P 500 to Trade[XYZ] for perpetual contracts on Hyperliquid
In a landmark move for decentralised finance, S&P Dow Jones Indices, the world’s leading index provider, announced last week that it has licensed the S&P 500 to Trade[XYZ] to launch the first officially licensed S&P 500 perpetual derivative contract on the Hyperliquid blockchain.
Trade[XYZ] is a leading provider of real world asset markets via perpetual futures derivatives on the Hyperliquid blockchain. The new collaboration represents the first time non-US investors can gain leveraged exposure to the S&P 500 through an officially licensed, digitally native product 24 hours a day, seven days a week on a decentralised platform
Furthermore, the new instrument will also use S&P’s real-time index data to guarantee the accuracy of index trading whilst traditional markets are closed.
$HYPE, the governance and utility token for Hyperliquid jumped 6% on the announcement. Year-to-date $HYPE is up over 55%, a stark contrast to major cryptoassets such as Bitcoin and Ethereum, which so far are down on the year.
The contrast in performance highlights how Hyperliquid’s infrastructure growth and support for 24/7 non-crypto markets like Silver, and most recently Oil, has benefited the decentralised exchange’s token price.
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