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Bitcoin (BTC) saw small gains on Tuesday alongside equity futures

In anticipation of the publication of US inflation data, Bitcoin (BTC) and equities futures both experienced modest rises on Tuesday. After reading 5.7% in December, the Consumer Price Index (CPI) is anticipated to decline to a rate of 5.5% in January. Risk assets may benefit from the inflation’s ongoing decline because it will be less necessary for the Federal Reserve to tighten monetary policy as aggressively. The degree of cryptocurrency’s potential loss will be determined by today’s CPI print, according to a morning note from QCP Capital.

After the NYDFS ordered Paxos to stop producing BUSD on Monday, LQTY, the native token of censorship-resistant decentralized stablecoin lender Liquidity, increased. According to TradingView data, the token increased 45% to a six-month high of $1.07, marking its largest single-day percentage rise in at least a year.

The Paxos-BUSD dispute, which raised concerns about a regulatory crackdown on the larger centralized stablecoin ecosystem and led some to speculate that Circle’s USDC would be the next target, is likely what sparked the spike. If that’s the case, stablecoins like Liquity’s LUSD that are decentralized and censorship-resistant make more sense.

According to Bloomberg, the rival stablecoin issuer Circle was the one to raise the red flag about Paxos. In the fall of 2022, Circle reportedly alerted the New York Department of Financial Services (NYDFS), alleging that blockchain data showed Binance lacked sufficient reserves to support the BUSD tokens it had distributed through Paxos. The information surfaced a few days after CoinDesk first reported that NYDFS was looking into Paxos.

Grace Owell

Written by Grace Owell

Grace Owell is an expert freelance writer from Texas, United States of America. Her expertise measures solely on personal finance and health articles. She currently writes for newsway.com.ng

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