Five Things to Know in Crypto Today: China PMI Sends Cryptos South

Key Insights:

• Crypto investors responded to an unexpected fall in the China Caixin Manufacturing PMI.
• Ripple Chief Legal Officer Stuart Alderoty retargeted SEC Chair Gary Gensler over the sweeping classification of cryptos as securities.
• ETH staking inflows tumbled over the weekend. A downward trend is a bearish signal ahead of the Shapella Upgrade.

China Caixin Manufacturing PMI Sends Crypto Market South

This morning, the crypto market hit reverse in response to economic indicators from China. The China Caixin Manufacturing PMI fell from 51.6 to 50.0. Economists forecast an increase to 51.7. Weak export demand weighed on production and the headline number.

While the manufacturing sector avoided a contraction, the latest figures poured cold water on hopes of a swift rebound in the Chinese economy following the shift in zero-COVID policy.

The crypto market cap fell from $1,138 billion to $1,121 billion within the first hour of the PMI survey.

This morning, the crypto market cap was down $15.62 billion (-1.37%) to $1,126 billion.

Ripple Chief Legal Officer Stuart Alderoty Targets SEC Chair, Gary Gensler

Overnight, Ripple Chief Legal Office Stuart Alderoty targeted SEC Chair Gary Gensler for the second time.

SEC Chair Gary Gensler made a sweeping statement in March, labeling all cryptos, except BTC, as securities.

Overnight, Stuart Alderoty responded further to Gensler’s statement, saying,

“Suddenly, now saying that you haven’t prejudged every crypto (with the possible exception of BTC) as a security after being called out for publicly prejudging every crypto as a security doesn’t unring the bell. Words have consequences, even for unelected senior bureaucrats.”

Ripple CEO Brad Garlinghouse shared his view on the Gensler statement, saying,

“For the Chair of the SEC to assert that he dictates what is a security – and not the legislation from which his agency derives its power – is beyond comprehension. It’s time for elected officials in the US to take notice.”

Alderoty’s comments followed an immediate response to the Gensler statement in early March, where the Ripple Chief Legal Office wrote,

“Chair Gensler has again proclaimed that every cryptocurrency, except BTC, is an unregistered security. He now must recuse himself from voting on any enforcement case that raises that issue since he has prejudged the outcome. Antoniu v. SEC (8th Cir. 1989).”

The statements have significance, with the outcome of the SEC v Ripple case likely to have a material impact on the US crypto regulatory landscape.

This morning, XRP was down 2.02% to $0.50821, reversing a 1.76% gain from Sunday.

ETH Staking Inflows Tumble as the Regulatory Landscape Muddies

On Sunday, ETH staking inflows fell for a second consecutive day and the second time in six sessions. Significantly, staking inflows slid to their lowest level since 5 March, when ETH staking inflows tumbled to 3,552 ETH.

According to CryptoQuant, staking inflows fell from 8,380 ETH on Saturday to 6,208 ETH on Sunday.

On Friday, ETH staking inflows jumped to 55,104 ETH before the weekend tumble.

The total value staked continued the downward trend this morning, suggesting a possible shift in sentiment toward the Shapella upgrade. High demand for unstaking ETH would be a bearish price scenario.

This morning, ETH was down 0.83% to $1,780, with ETH tracking the broader crypto market into negative territory.

UK Banks Rollout More Crypto Restrictions

On Sunday, news hit the wires of HSBC (HSBC) and NatWest Group (NWG) introducing transfer restrictions for crypto-related transactions.

The latest move by two UK banks goes against British Prime Minister Rishi Sunak’s aim to make the UK a crypto hub.

UK and US Anti-Crypto Drive Gives Hong Kong a Stronger Footing

Regulatory uncertainty and anti-crypto activity bring Hong Kong closer to becoming a crypto hub.

In February, the HK Securities and Futures Commission announced the launch of a consultation on the proposed requirements for operators of virtual asset trading platforms.

According to the announcement,

“Under a new licensing regime to take effect on 1 June 2023, all centralized virtual asset trading platforms carrying out business in Hong Kong or actively marketing to Hong Kong investors will need to be licensed by the SFC.”

The announcement went on to say,

“As part of the consultation, the SFC is seeking views, particularly on whether to allow licensed platform operators to serve retail investors, and if so, the measures to be implemented in addition to the proposed range of robust investor protection measures, which include ensuring suitability in onboarding clients and token admission.”