Investors have shown a marked preference for Bitcoin over altcoins, with the US SEC categorizing it as a commodity instead of a security. Bitcoin experienced a notable rally on Thursday, surging by 10% and bringing its market capitalization close to $500 billion. In the overall cryptocurrency market, Bitcoin’s share has reached nearly 43%. Currently, Bitcoin’s price is at its highest since August.
It’s worth noting that last year, the crypto market suffered a significant loss, with $1.4 trillion wiped from its market capitalization. The collapse of the FTX exchange further dampened prospects. However, the market has since shown signs of recovery, with buying interest returning. Bitcoin possibly reached its lowest point on November 9th at $15,700, ending its previous rally.
The SEC’s Potential Move Against Paxos
The US Securities and Exchange Commission (SEC) is reportedly gearing up to take action against Paxos, a company known for issuing a type of cryptocurrency called stablecoin. This move could have considerable implications for the stablecoin market, valued at approximately $137 billion, according to experts who spoke to CNBC.
Stablecoins are cryptocurrencies that aim to mirror the value of tangible assets like the US dollar. Real assets, such as bonds or cash reserves, often back them, and they have become integral to the crypto market. They facilitate the quick trading of various coins without the need for conversion to and from fiat currency.
Paxos has issued a digital currency known as Binance USD (BUSD). This stablecoin is associated with Binance, one of the world’s largest cryptocurrency exchanges, and is pegged on a one-to-one basis with the US dollar.
Recently, the New York State financial regulator ordered Paxos to cease the issuance of BUSD, a directive with potentially significant repercussions for the stablecoin market.
