Bitcoin’s recent surge to a new record high has been followed by a pullback, but crypto enthusiasts remain confident in the digital currency’s future.

After reaching nearly $74,000, Bitcoin has dropped by as much as 13%, trading around $68,000 recently. This correction is not unusual in the volatile crypto market, and Bitcoin is still up by about 50% for the year, largely driven by excitement surrounding the SEC’s approval of 11 spot ETFs in January.

The recent sell-off is attributed to profit-taking, as investors lock in gains from the sustained rally. Other cryptocurrencies, like Ether and Solana, have also seen declines, with Ether down 8% and Solana down 12% in recent days.

Despite short-term fluctuations, some analysts remain bullish on Bitcoin, especially with the upcoming “halving” event expected in April. During this event, the reward for mining new blocks of Bitcoin will be halved, reducing the token’s supply and potentially driving up its price.

Past halving events have led to significant price increases for Bitcoin, with the cryptocurrency surging from under $9,000 to about $60,000 in less than a year after the 2020 halving. Analysts believe that Bitcoin’s increased mainstream acceptance this time around could lead to sustained demand and further price growth.

While some market observers warn of potential risks, such as an economic slowdown prompting investors to sell riskier assets like Bitcoin, others see the current environment as supportive of further gains. The combination of halving and the rise of spot Bitcoin ETFs could create an “explosive set-up,” according to some analysts, potentially pushing Bitcoin into uncharted territory.

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Cryptocurrencies swiftly rebounded from their recent pullback as the Federal Reserve’s comments restored risk appetite in global markets, attracting buyers back to the crypto space. Within 24 hours, the total market capitalization surged by 7.7% to $2.55 trillion. While Bitcoin showed a similar growth pattern, Ethereum and Solana saw even stronger gains, adding around 10%.

Bitcoin maintained levels above 61.8% of its rally, staying around $60.3K, indicating resilience in the face of recent volatility. If the current positive sentiment persists, the next major target for Bitcoin could be a return to its previous highs above $73K.

Ethereum’s price reversed upwards after briefly touching the 50-day moving average, confirming that the recent correction was a temporary setback rather than a trend reversal. Solana, which experienced a more significant dip of over 22% between March 18th and 20th, falling from $210 to $162, has also recovered, currently trading around $190.

Technical indicators for all three cryptocurrencies suggest a bullish trend, with a strong recovery following the recent pullback. The market sentiment was buoyed by weakness in the Fed and other central banks, prompting active buying.

In Other News

S&P Global Ratings issued its ninth “stability assessment” of major stablecoins, rating USDC, USDP, and GUSD as “strong,” while Mountain Protocol’s USDM received an “adequate” rating. USDT, DAI, and FDUSD were rated “limited.” Four stablecoins had their ratings downgraded due to transparency and risk-related concerns.

BlackRock, the largest asset management company, filed to launch a USD Institutional Digital Liquidity Fund, marking its first fund with tokenized assets.

The SEC is reportedly looking into designating Ethereum as a security, according to Fortune, citing unnamed US companies subpoenaed for the investigation.

Bloomberg reported that the likelihood of spot Ethereum ETFs being approved in the US in May is diminishing, as regulators appear hesitant.

Since March 12th, the Solana ecosystem has hosted 33 pre-sale fundraising campaigns for token launches, raising a total of 796,000 SOL (~$139 million). The largest pre-sale was for the Book of Meme (BOME) meme token, which has surged in value by approximately 40,000% since its launch.

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In a move that signals increasing mainstream acceptance, Coinbase Derivatives is set to introduce futures trading for three prominent cryptocurrencies: Dogecoin, Litecoin, and Bitcoin Cash, beginning April 1.

Using self-certification with the Commodities Futures Trading Commission (CFTC), Coinbase aims to swiftly list these futures contracts while ensuring compliance with regulatory standards. These cryptocurrencies, stemming from Bitcoin, which the Securities and Exchange Commission (SEC) acknowledges as a commodity, have been chosen for futures trading, leveraging their established status within the crypto market.

Dogecoin, initially conceived as a lighthearted meme, is now receiving serious attention as it joins the roster of tradable assets. Coinbase’s announcement to launch monthly cash-settled futures contracts for Dogecoin, Litecoin, and Bitcoin Cash was communicated to CFTC Secretary Christopher Kirkpatrick in separate letters dated March 7. The letters outlined key details such as contract sizes, settlement methods, and the utilization of a benchmark rate by Market Vector.

Coinbase’s decision to utilize the self-certification route under CFTC Regulation 40.2(a) underscores its commitment to regulatory compliance. This approach allows for the introduction of new offerings without direct CFTC approval, provided the products adhere to the Commodity Exchange Act and CFTC regulations.

The regulatory classification of these cryptocurrencies as commodities, rather than securities, raises intriguing questions within the industry. Bloomberg Intelligence ETF research analyst James Seyffart noted the significance of this development, particularly in distinguishing these assets as “commodities futures” rather than “securities futures.” Given their lineage from Bitcoin, arguing for their classification as securities would pose challenges, especially following the approval of spot Bitcoin ETFs. Coinbase’s strategic selection of these cryptocurrencies for futures trading reflects a nuanced understanding of regulatory dynamics and market trends.

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Discussions among lawmakers have stagnated for months as the upcoming election season draws near, rendering the passage of bills in Washington nearly impossible.

Despite this, lawmakers involved in drafting stablecoin bills express optimism about legislative progress in both the Senate and the House. However, a stablecoin bill, viewed as relatively achievable compared to other crypto-related bills, has encountered obstacles, with time running out to bring it to a vote.

A stablecoin bill spearheaded by House Financial Services Committee Chair Patrick McHenry, R-N.C., made headway out of the committee over the summer. However, it faced bipartisan contention, with Congressional Republicans attributing opposition to the White House. Notably, top Democrat Maxine Waters of California criticized the bill as “deeply problematic,” citing a provision allowing state regulators to approve stablecoin issuances without Federal Reserve input.

Although Waters and McHenry have increased their interactions since then, discord persists regarding the primary regulator for stablecoin issuers.

McHenry remarked on Wednesday at Coinbase’s Update the System Summit, indicating a “workable frame” for progress. He emphasized the need for a legislative vehicle and a deadline to address unresolved issues effectively.

Cody Carbone, vice president of policy for the Chamber of Digital Commerce, noted ongoing talks between McHenry and Waters’ teams but highlighted minimal progress on substantive issues.

Regarding the bill’s prospects in the House, Carbone suggested a 50% chance of passage but a mere 5% likelihood of enactment into law due to various complexities.

Uncertainty also looms in the Senate, where Sens. Kirsten Gillibrand, D-N.Y., and Cynthia Lummis, R-Wyo., aim to unveil a stablecoin bill focusing on regulatory clarity and consumer protection. However, uncertainties surround the bill’s details and completion strategy, with discussions facing setbacks.

Lummis expressed optimism about bipartisan efforts, citing Senate Majority Leader Chuck Schumer’s openness to consider such legislation. She anticipates progress on stablecoins in 2024.

Despite challenges, stakeholders are encouraged by legislative efforts in both chambers, expressing optimism about achieving consensus before the year concludes.

However, hurdles remain, with the Senate Banking Committee prioritizing other issues, potentially impeding progress on stablecoin legislation. Efforts to package bills, such as a potential compromise between stablecoin and marijuana banking bills, offer glimmers of hope, but challenges persist in navigating House gridlock.

Ultimately, lawmakers aim to position themselves for the next Congress, emphasizing the importance of advancing stablecoin legislation despite potential delays beyond the year’s end.

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The Ethereum Foundation, the core entity behind the Ethereum ecosystem, is under scrutiny as reports surface of an ongoing investigation by an undisclosed “state authority.” This revelation comes amidst past legal inquiries, including allegations linked to the 2016 Gatecoin hack.

In a GitHub commit dated February 26, 2024, the Ethereum Foundation disclosed receipt of a voluntary inquiry from a state authority, coupled with a strict confidentiality mandate. Details regarding the nature of the inquiry and the identity of the authority remain undisclosed.

CoinDesk noted the removal of a disclosure from the Ethereum Foundation’s website, previously asserting no contact from any agency necessitating non-disclosure. Additionally, the website’s warrant canary, a signal indicating the absence of covert government subpoenas or requests, was also removed in the same GitHub commit.

The elimination of the warrant canary raises community concerns, as it traditionally serves as a subtle indicator of potential government involvement. Typically, companies employ warrant canaries on their websites to signal receipt of secret government requests.

Previous legal scrutiny faced by the Ethereum Foundation, particularly concerning its alleged involvement in the 2016 Gatecoin hack, adds context to this recent development. Accusations brought forward by on-chain forensic analyst TruthLabs targeted key figures such as Vitalik Buterin and Joseph Lubin, sparking intense community debates and prompting an independent legal investigation.

It remains unclear whether the ongoing investigation is linked to past incidents or pertains to a separate matter. Concurrently, the Securities and Exchange Commission (SEC) continues evaluating multiple applications for an Ether Exchange-Traded Fund (ETF). However, analysts express waning optimism regarding approval, citing limited engagement between applicants and SEC officials.

In response to the news, Ethereum ($ETH) experienced a sudden 3% decline within minutes, currently trading at $3,285 according to CoinMarketCap.

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