Cryptocurrency Prices Rise as SEC Renames Its Crypto Unit and Atlanta Fed President Raphael Bostic Makes Dovish Comments

Renaming the Crypto Assets and Cyber Unit is significant because it shows the agency is moving away from its crypto focus that often led to accusations of regulation by enforcement and legal battles with major industry participants.

Cryptocurrency prices rose on Friday after the U.S. Securities and Exchange Commission’s former crypto enforcement unit transitioned into the Cyber and Emerging Technologies Unit, and amid dovish comments from Atlanta Fed President Raphael Bostic.

The SEC’s Economic and Risk Analysis Division will now oversee crypto enforcement, a move that could signal a shift in the agency’s approach to regulating the nascent industry.

The agency’s crypto enforcement unit was established in 2018 to oversee investigations and enforcement actions related to cryptocurrency markets. However, the unit’s narrow focus often led to accusations of regulation by enforcement and legal battles with major industry participants.

“In the near to medium term, clearer regulations will likely boost institutional participation, leading to improvements in market infrastructure,” BackPack founder and CEO Armani Ferrante told CoinDesk.

Bitcoin is now above $98,000 after adding 1.2% in 24 hours, while the broader CoinDesk 20 Index rose 1.35%.

However, volatility is still relatively low. “These environments may feel slow and frustrating, but they rarely persist for long — volatility tends to mean revert,” Wintermute OTC trader Jake O told CoinDesk.

With tensions between the U.S. and its European allies growing, investors are hoping Germany's election on Sunday will lead to a stable coalition government that will push out economic reforms to stimulate growth and boost defense spending.

Germany is Europe’s largest economy and a positive result could lead to a more risk-on approach.

Open interest has already moved up ahead of the election. Still, the crypto market lacks positive catalysts in the near term, JPMorgan analysts led by Nikolaos Panigirtzoglou wrote in a report.

In fact, the market is nearing backwardation — where spot prices rise above futures prices — in a “negative development” that’s “indicative of demand weakness” by institutional investors using regulated CME futures contracts to gain exposure to the market. Stay alert!