It’s been a tough January for Bitcoin (BTC) and the broader crypto market. In fact, Bitcoin hasn’t had this bad a start to the year since 2018.
Market reaction to inflation and the shift in the FED’s shift away from seeing inflation as transitory weighed heavily on appetite for riskier assets. Also negative, however, has been a marked increase in regulatory chatter and activity.
The Regulatory Landscape
Following China’s crypto mining ban last summer, the crypto market would have been hoping for a peaceful start to the year. Late last year, the only major concern for the market had been the SEC lawsuit against Ripple Lab. That was until the Bank of England called for a global crypto regulatory framework late last year. At the turn of the year, SEC Chair Gensler also talked of increased crypto scrutiny, needed to protect investors.
More significantly, however, was concerns raised by both the Bank of England and the International Monetary Fund (IMF) on the interconnectedness between cryptos and the global financial markets. The concerns have been justified at the turn of the year, with both the NASDAQ and the crypto market in deep red.
Considering the regulatory landscape, news of crypto friendly jurisdictions emerging to buck the recent regulatory trend should be crypto market positive.
Gibraltar Aims to Host First Crypto Stock Exchange
News hit the wires this week of plans to roll out the first crypto stock exchange in Gibraltar. The Gibraltar Exchange (GSX) would permit the trading of stocks and other asset classes in digital currencies.
There is a long way to go, however, for such an exchange to exist. According to the news wire, British business man Richard O’Dell Poulden plans to enable crypto holders to intertrade between digital and traditional asset classes. For crypto holders, there would be no capital gains tax that would result from any conversion to fiat. Here, holders are spending cryptos to purchase stocks denominated in crypto. Bitcoin, Dogecoin (DOGE), Cardano (ADA), Ethereum (ETH), and Tether (USDT) are amongst the proposed cryptos.
Poulden needs to purchase an 80% stake in the Gibraltar Stock Exchange to make this happen. The Gibraltar Financial Services Commission needs to approve the 80% purchase for Poulden to proceed.