Ethereum bulls chase $2,200 ahead of Friday’s $230M ETH options expiry

A $2,200 Ethereum price would give bulls a $28 million advantage in this week’s ETH options expiry, but traders are more focused on the impact of the London hard fork in mid-July.

Ether’s (ETH) $1.5 billion monthly expiry on June 25 was slightly favorable for bears, and at the time, Cointelegraph reported that the $2,200 price was critical to eliminate 73% of the neutral-to-bearish put options. 

However, bulls were not able to sustain their advantage because the expiry price was near $1,950. In the end, the protective put options outnumbered the neutral-to-bullish call options by $30 million.

Fast forward to July, and after a noticeable 10% rally, Ether’s price again struggles to sustain the $2,100 support. Bitcoin’s negative 3.5% performance could partially explain last week’s price move, but the London hard fork scheduled for this month could also be responsible.

The proposal EIP-1559 will cap gas fees, making it more predictable for users. However, miners’ revenue will be negatively impacted. Any pushback from miners could delay Eth 2.0 even more, which could be a reason for the recent price weakness.

Lastly, regulatory pressure could also be blamed for the negative sentiment. For example, the United States Financial Crimes Enforcement Network announced that cryptocurrencies would be among its top national priorities for countering terrorism financing and ensuring proper Anti-Money Laundering policies.

Related: Bulls and bears fight over $34K Bitcoin price as $445M options expiry looms

Bulls have a slight advantage, but overall the expiry should be small

The July 2 $230 million Ether options expiry perfectly reflects a scenario where both bulls and bears expected extreme price changes.

Ether’s July 2 aggregate options open interest. Source: Bybt

110,000 Ether contracts seem initially balanced between the call (buy) and put (sell) options. However, only 30% of the neutral-to-bullish call options have been placed at $2,200 or below, which is equivalent to a $36 million open interest. The remaining 70% of the call options are unlikely to take part in Friday’s expiry.

On the other hand, protective puts were mostly placed at $1,900 and lower. However, these contracts are now worthless as there are less than 14 hours before they expire. Therefore, the remaining neutral-to-bearish options down to $2,100 amount to a $26 million open interest.

In a nutshell, Friday’s Ether expiry will be relatively small, but the $2,200 mark is extremely important. Above that level, the bulls’ lead increases by $18 million, causing a $28 million imbalance that favors call options.

Bears aim for $2,100 or lower to eliminate the bulls’ advantage

For bears, any expiry price below $2,100 is enough to balance out the situation. However, it is worth noting that Friday’s expiry size has been greatly reduced because both sides had extreme bets, but none of them were fulfilled.

At the time of writing, there is no reason to believe that either side will try to force Ether’s price in a particular direction ahead of the expiry. Traders will likely concentrate their bets (and efforts) for the end of July, depending on whether or not the London hard fork faces any delays or surprises.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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‘We don’t have much time left’ to regulate crypto, says Bank of France governor

“We in Europe need to move as quickly as possible or risk an erosion of our monetary sovereignty,” said Francois Villeroy de Galhau.

Bank of France governor Francois Villeroy de Galhau said that Europe should make crypto regulation a priority or risk digital assets challenging its monetary sovereignty.

At a Paris Europlace financial conference today, Villeroy said he believed the European Union only had “one or two years” left in which to establish a regulatory framework for cryptocurrencies. To not act, according to the central bank governor, would “risk of an erosion of our monetary sovereignty” and potentially weaken the euro.

“I must stress here the urgency: we do not have much time left, one or two years,” said Villeroy. “On both [digital] currencies and payments, we in Europe need to move as quickly as possible.”

Villeroy called on the EU “to adopt a regulatory framework in the coming months,” given the growing role cryptocurrencies are playing in regional markets. The use of cash declined during the first few months of the pandemic, a trend that Villeroy said could lead to “marginalization of the use of central bank money.”

Related: Bank of France Is Closely Watching Stablecoin Developments, Says Governor

The Bank of France governor has previously warned regulators against the potential risk of cryptocurrencies, including stablecoins and central bank digital currencies, or CBDCs. In September he said big tech companies could potentially build “private financial infrastructures and monetary systems” — including issuing their own stablecoins — which could adversely impact financial sovereignty in the EU for decades.

In January, the bank completed a pilot program for its own CBDC, later reporting investors had purchased and sold 2 million euros — roughly $2.4 million at the time — worth of simulated shares. The Bank of France has said it will conduct other test runs for the digital currency this year. 

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SEC accuses XRP Army of issuing ‘false statements’ against its leadership on social media

The commission argued that Ripple’s motion, if granted, would open the floodgates for the company to request testimony from high-ranking government officials.

The ongoing lawsuit between Ripple Labs and the U.S. Securities and Exchange Commission, or SEC, continues with the regulatory body claiming that XRP token holders are targeting its members on social media platforms with allegedly false statements.

In a Thursday motion addressed to Judge Sarah Netburn in the Southern District of New York, the SEC has requested a conference to discuss quashing the motion from Ripple to subpoena the former director of the regulatory body’s division of corporation finance, William Hinman. The SEC argued that Ripple’s motion, if granted, would set a precedent for the company to be allowed “a parade of requests for the testimony of high-ranking government officials,” and interfere with U.S. government operations.

“Allowing Defendants [Ripple] to depose Director Hinman would likely result in Director Hinman being served with multiple deposition subpoenas by the many other persons alleged to have violated the registration provisions of the securities laws during his tenure at the SEC,” said the motion. “Such a result would not only create significant burdens for Director Hinman, but would make other qualified individuals reluctant to serve in high-ranking roles at the SEC for fear of being embroiled in litigation for years following their terms of service.”

However, one of the SEC’s arguments in the motion against letting Ripple depose Hinman is XRP token proponents — also known as the XRP Army — allegedly using social media “to disseminate negative and false statements about members of SEC leadership,” including the former director. The commission claimed that the deposition coupled with the social media attention could deter individuals from seeking positions in public service.

The SEC filed a lawsuit against Ripple in December, alleging the firm, CEO Brad Garlinghouse and co-founder Chris Larsen had been conducting an “unregistered, ongoing digital asset securities offering” with their XRP token sales. In the aftermath of the commission’s announcement, several crypto exchanges have suspended the trading of XRP or delisted the token entirely. Garlinghouse also said in March that Ripple had agreed to “wind down” its partnership with global money transfer service MoneyGram.

Related: US isn’t prepared to regulate new industries like crypto, says Ripple CTO

In response to the SEC lawsuit, Ripple has claimed that XRP is more like Bitcoin (BTC) or Ether (ETH), both of which the regulatory body has classified as commodities rather than securities. Members of the XRP Army have also seemingly focused much of their online activity around the SEC case with Ripple, specifically mentioning Hinman.

Some of the ideas on social media pushed by XRP token holders about the SEC leadership include that members of the commission are working to make China’s economy greater than that of the United States, requests that former chairperson Jay Clayton and Hinman be investigated, and the occasional comparison of one or more members to lizard people:

XRP Army members have also started an online campaign to get exchanges to relist the token amid the SEC lawsuit. In April, the price of XRP reached a yearly high of $1.78 and stayed above the $1.00 level for a month. At the time of publication, XRP is $0.63, having fallen more than 35% in the last 30 days.

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Mexico lawmakers aim to follow the example of neighboring countries with proposed Bitcoin legislation

“We are going to lead the shift to crypto and fintech in Mexico,” said one senator.

Eduardo Murat Hinojosa, a senator of the federal government of Mexico, has said he will be submitting a proposal to lawmakers seemingly aimed at crypto adoption in the country.

In a tweet today, Hinojosa changed his profile picture to feature the senator speaking into a microphone with the iconic “laser eyes,” indicating support for crypto. The lawmaker said he would be “promoting and proposing a legal framework for crypto coins in Mexico’s lower house,” specifically mentioning Bitcoin (BTC).

Hinojosa was not the only Mexico lawmaker indicating their support for crypto. Indira Kempis Martinez, a senator representing the state of Nuevo León, has also switched her profile to show laser eyes, with Hinojosa referring to her as a friend to the cause.

“We are going to lead the shift to crypto and fintech in Mexico,” said Hinojosa.

The social media activity comes as countries in Latin America have seemingly been taking steps towards greater adoption of crypto. In a video announcement to attendees of the Bitcoin 2021 conference last week, El Salvador President Nayib Bukele said he would send a bill to the country’s legislature demanding that Bitcoin be made legal tender.

On Sunday, Paraguayan congressperson Carlitos Rejala hinted that crypto would be connected to “an important project to innovate Paraguay in front of the world” starting this week. Yesterday he added that he was working with local crypto figures “in order for Paraguay to become a hub for the crypto investors of the world.”

Though Mexico has many individual investors who back Bitcoin, authorities in the country reported last year that cartels had been increasing their use of crypto to launder funds. At the time, the head of the Mexican attorney general’s Cyber Investigations Unit said the country’s law enforcement lacked the resources needed to tackle money laundering when crypto was involved.

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Harvard Law BFI throws 10.5M votes behind own proposal to fund DeFi lobby with UNI

It is not the first time Uniswap governance has been dominated by a whale.

The effect of whales on Uniswap governance is a topic of hot debate once again after Harvard’s blockchain group threw a massive amount of voting power behind its own proposal.

The proposal, made on May 27 by the Harvard Law School Blockchain and FinTech Initiative, is for the creation of a fund that would finance existing and new political groups engaged in crypto policy making and lobbying to defend decentralized finance against regulation.

The proposed fund would have a chest of 1-1.5 million UNI, worth approximately $28 million to $42 million at current prices. At the time of writing Harvard Law BFI has pledged 10.46 million UNI tokens, or 99% of the votes, in favor of the proposal. There are just 766,460 votes against it so far.

Industry observer and critic of centralized governance, Chris Blec from DeFi Watch, was one of the first to comment on the heavily weighted voting mechanism.

The “here we go again” quip refers to Uniswap’s first governance vote in October 2020, proposed by trading platform Dharma to reduce the proposal submission threshold. The proposal would have given the majority of the voting power to the top two token holders (Dharma and blockchain simulation platform Gauntlet). The two of them dominated the ballot with their own heavy bags bringing Uniswap’s governance into question, however, the vote was defeated by a tiny margin.

The lobbying fund, if passed, would have four primary goals according to Harvard, consisting of educating policymakers to preempt regulatory, legal, political, and tax threats to DeFi, secondly achieving regulatory clarity for DeFi related activities. The third goal would be to advance laws that support DeFi and decentralized governance, and finally encourage other DeFi protocols’ governance communities to contribute to the effort.

Harvard Law BFI responded stating that it was only natural for them to vote for their own proposal, adding:

“Additionally, we have this voting power from UNI holders who delegated their votes to us (which they are free to retract at any time).”

It stated that there were enough votes to create a snapshot proposal, but it cannot unilaterally get it through a consensus check without a majority of votes.

At the moment the proposal is in “temperature check” mode which means it needs a minimum of 25,000 UNI in support, which it already has. To pass a full proposal after the “consensus check” stage, it needs a quorum of 40 million UNI in favor.

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