Market makers Jane Street and Jump Trading are retreating from crypto trading in the U.S. as a regulatory crackdown on the industry has intensified, Bloomberg reported. Both firms are still making markets and not abandoning the crypto industry entirely, according to the story. However, the report continued, Jane Street is scaling back its global crypto expansion plans, while Jump Crypto – the digital assets trading unit of Jump Trading – is pulling back from U.S. markets, although still planning to expand internationally.
Ratings agency S&P Global on Tuesday acknowledged crypto’s popular appeal as an inflation hedge, but noted the data shows a weak correlation to inflation expectations. “Crypto assets could theoretically be a hedge against inflation,” the New York-based agency said in a press release shared with CoinDesk, noting adoption in some emerging markets battling high inflation.”Some argue that crypto assets could be in demand in a high-interest rates/high inflation environment because they could serve as a store of value,” said S&P. “We think the track record for crypto is too short to prove this,” the agency added, noting data showing bitcoin’s (BTC) weak correlation with U.S. inflation expectations.
Su Zhu, a co-founder of defunct crypto hedge fund Three Arrows Capital (3AC), has obtained a restraining order against trading platform BitMEX co-founder Arthur Hayes from a Singapore court. The order dated May 5 and seen by CoinDesk prohibits Hayes from using “threatening, abusive or insulting words” and “making any threatening, abusive or insulting communication that would cause the Applicant harassment, alarm or distress.” Hayes has been tweeting at Zhu and his 3AC partner Kyle Davies, mainly asking for $6 million he says is owed following the collapse of the hedge fund last year.
Market Insight: More Volatile BTC?
On Wednesday, at 8:30 AM ET (12:30 UTC), the U.S. Bureau of Labor Statistics will release the consumer price index (CPI) for April.
The headline CPI inflation figure is forecast to stay unchanged at 5% year-over-year and the core figure, which excludes the volatile food and energy component, is forecast to be at 5.5% versus 5.6% in March, according to Reuters estimates published by FXStreet.
Bitcoin (BTC) has historically seen increased intraday volatility in the six-hour window before and after the inflation data, according to Dessislava Aubert, a research analyst at Paris-based crypto data provider Kaiko.
The chart compares trading volume in the Binance-listed bitcoin-tether (BTC/USDT) pair with its 1% market depth – a collection of buy and sell orders within 1% of the average of the bid and the ask/offer prices.
The market depth has halved since Feb. 1, while volumes have declined sharply since the exchange removed zero-fee trading on March 22.
Low market depth means traders may struggle to execute large orders at stable prices.
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