Bitcoin briefly drops below $62,000 as economic and geopolitical pressures loom: CNBC Crypto World

Today, Bitcoin in either slide more than 4% as economic and geopolitical pressures loom. Finance US adds a former New York Fed official to its board. And OK X just launched a Layer 2 with the help of Polygon. We talked to OK XS Haider Rafiq about the rollout. Welcome to CNB CS Crypto world. I’m Talia Kaplan. The crypto market under pressure as Treasury yields are on the rise and geopolitical tensions remain high. By noon, Eastern Bitcoin tumbled to the $61,000 level for the first time since early March. Ether took a nearly 5% hit, trading just above $3000. And polygons Matic token slumped more than 5%. OK, let’s talk about the top stories. Finance US just added a former New York Fed official to its board of directors. Martin Grant served at the bank for more than 30 years, including seventeen years as the chief compliance and ethics officer. Currently, he works at JST Digital, a financial services firm that specializes in digital assets, as its global head of regulatory affairs and integrity. Now Finance US says Grant will help oversee financial reporting processes and internal controls. Grant joins the board in the midst of regulatory headwinds for both Finance US and its parent company. Back in November, the international arm of the business and its founder Sheng Ping Xiao settled with U.S. officials over anti money laundering violations last crypto exchange OK XS. New Layer 2 blockchain just launched on its public mainnet. X Layer is the ZK powered Layer 2 built with Polygons Chain Development Kit, a set of open source software tools to help developers build their own chains on Ethereum. According to Polygon, the new L2 means no cross chain bridging is required for users and there will now be a broader pool of on chain liquidity. On top of that, developers for the OK X community will have a better experience building daps now. This comes as other major crypto exchanges like Coinbase have pursued their own layer two networks in recent months. According to Coin Market Cap, OK X is the 4th largest crypto exchange following Finance, Coinbase and Buyback. All right sticking with OK X. For our main story, I spoke with the crypto exchanges Chief Marketing Officer Haider Rafiq about X layer and the upcoming halving which is just days away. Big announcement from OK X today with the crypto exchange launching its new Layer 2 blockchain. Now of course you’re not alone as other crypto exchanges have pursued their own layer two networks, with Coinbase launching its base blockchain in August. But why was it important for OK X to take this step? And why do you think other exchanges are also taking action in this regard? It all starts with the consumer behaviour. If you look at the on chain activity now, it’s about 11 times more than what it was three years ago. We are one of the largest venues in the world for crypto and for us we feel a a duty, an obligation to the industry to streamline things. And I think one of the ways we’ve been streamlining things is creating more interoperability between different networks, layer ones and layer twos. But I think one step below that is US introducing our own Layer 2, which helps accelerate more developers coming in and building Dafs on chain. But also it makes it cheaper for end users for consumers to interact with on chain activity without breaking their bank. So our our fees, our mission is to really make sure that the fees remain really low comparatively to the other L ones out there in the market. Now switching gears. The widely anticipated Bitcoin having is just days away and the key technical event reduces the number of new Bitcoin entering the network each day, which means tighter supply. Now historically, the halving has set the stage for Bitcoin’s next bull cycle. This time around we saw a rally leading up to the halving. With things like the launch of Swap Bitcoin ETFs in the US in the mix, what do you expect will happen to Bitcoin’s price following the halving? Will we see a rally like we did following past Halving’s? Well, if if I think there are two ways to look at this. One is we bet on the historicals. If we bet on the historicals, then that that segment of people would anticipate later at the end of this year or maybe going into 2025, we actually see the real bull run. You know, post having the other school of thought is maybe the price is already baked in and there’s a lot of increasing institutional demand. If you look at the Bitcoin holding now, there’s more institutions holding it than retail. There’s not a lot of supply to go around. So what happens as the ETFs continue to grab more market share bringing more consumers in? I think it will disrupt the way people have historically thought about Bitcoin having and price run UPS. It’s really hard to predict, but it’s going to be really interesting to watch it. We discussed price obviously, but how do you think the halving will impact the industry as a whole? I just worked on a report on the implications on minors and many say they expect consolidation post halving somewhere between 15 and 30%. Do you see that happening and what else are you expecting following the halving? I think it’s going to be a really challenging landscape for miners. I do expect there’s going to be some level of consolidation that happens. But look, as long as the price goes back up, their profitability will come back on track. So I think that’s what they’re really betting on all miners, which is that, you know, even if there is a slight pullback, long run, if there’s a substantial increase in price, their profits go up and they’re able to sustain their cost of operations. You know, in addition to that, I think I’m really personally watching how the ETFs get built up. I know there was this recent announcement in Hong Kong where there was approval for Bitcoin and Ethereum ETFSI think that’s going to continue to bring more demand into the ecosystem. The challenges for Bitcoin at least there’s not a lot of supply left to go around, which I think could create a supply shock and perhaps another run up later on down the road. What does the having mean for OK X, if anything, it doesn’t mean much for us. Look, our industry tends to be very pro cyclical. If you look at the having schedule, a lot of the demand comes in around this time and then it sort of neutralizes. So for us, what it really means is making sure our systems are robust, they’re working properly. Our trading systems, our matching systems, our overall Web 3 technology is seamless. I think that’s the big role that we play as the second largest venue in the world. Let’s focus on prices for a second. Bitcoin dropped to the $61,000 level as of noon and over the weekend tumbled due to rising tensions in the Middle East. Now this comes just one month after Bitcoin hit a new all time high above $73,000. So how do you explain what’s going on with prices right now? What have you noticed on your crypto exchange? Have you been seeing a lot of selling pressure recently? And if so, what do you attribute that to? I I think when the price dropped, I tweeted something, you know, just very instinctively something like Bitcoin is the only asset that prices the world in real time. I think the markets were closed, but we were able to see what would happen to the markets when they would open on Monday, at least on the traditional side of things. So I think Bitcoin can play a really important role in the real time signal as it relates to world politics or any big event that happens now on our platform. The demand is somewhat stable. It’s not that we’re coming into this week and the the demand has started to soften down. Prices were high last week, they were crawling back up above 70,000. We saw more traders getting into the marketplace, but generally speaking, we have a flat market coming into this week. Now we’re hearing a lot about this growing narrative around the utility and real world applications being built on top of crypto. What are you paying attention to right now in that regard? What has caught your attention? So we do have an investment arm called OKX Ventures, and they recently published a report about the trends that we’re at least paying attention to. So recently we invested in five companies. We think there’s a potential for AI and crypto to see a very significant convergence in the coming years. But for that convergence to happen, that fundamental foundational layer needs to be developed. A lot of the infrastructure needs to be developed. So the five investments we have made recently are all infrastructure data plays with the hope that we can be a significant contributor in building up that foundation. So developers can come in and really take advantage of the accelerating AI development along with cryptonomics. OK, that’s all for Crypto World today. We’ll be back again tomorrow and we’ll see you then.