The world eagerly awaited the release of the latest inflation data from the United States on the night of the 10th. At 20:30 in the Beijing time zone, the data was released. CPI inflation was 3.5%, exceeding expectations by 0.1 percentage points. Core inflation was 3.8%, also exceeding expectations by 0.1 percentage points.
The media sensationalized the rising inflation and the Fed’s struggle to control it, leading to a further delay in the expected interest rate cut. Indeed, the futures market has abandoned its bets on a rate cut in June.
However, I believe this may be a false alarm.
Let’s take a look at the inflation chart:
[Insert inflation chart]
Now let’s take a look at the core inflation chart:
[Insert core inflation chart]
As we can see, although it is slightly higher than expected, inflation did not rebound significantly, and core inflation is still in a downward trend. Powell can confidently say that everything is under control.
Data is one thing, how the market interprets it is another. How the Fed interprets it is yet another.
In fact, the reaction of the spot BTC market also confirms this assessment.
[Insert BTC price chart]
As shown in the chart, BTC started to decline from 69.5k before 8:30 pm (UTC+8) on the 10th. When the unexpectedly high inflation data was released at 8:30 pm, the bears dumped all their chips, causing the price to drop from 68.8k to a low of 67.5k. But this rapid decline immediately saw a surge in trading volume, indicating that the bulls were well-prepared and easily absorbed the selling pressure from the bears. The bears made another attempt at 21:00, but after selling everything they had, they ran out of ammunition and were slaughtered by the bulls. The bulls successfully regained their territory in just about an hour and rebounded above 71k after 8 hours. The bearish attack ended in complete failure.
The panic caused by the birds that startle easily with a bow and arrow only confuses people. The true warriors are those who hold the chips and ammunition, as they determine the direction of the battlefield.
While BTC absorbed and resolved an external event impact, on the night of the 10th, Uniswap Labs, the developer of the decentralized token exchange protocol Uniswap and the operator of the uniswap.org portal, confirmed that they had received a “Wells Notice” from the U.S. Securities and Exchange Commission (SEC).
The Wells Notice is named after John Wells. During his tenure at the SEC from 1972 to 1976, he designed the enforcement procedures for the SEC to initiate actions against individuals or companies for financial misconduct. The Wells Notice is an informal document that serves as a warning before formal action and encourages the recipient to proactively communicate and negotiate with the SEC before formal litigation. According to the procedure, Uniswap Labs has 30 days to respond to the notice.
Affected by this notice, the governance token UNI of Uniswap plummeted more than 15% during the day, dropping from $11 to around $9.
Speaking of which, it is reasonable and expected that Uniswap Labs received a Wells Notice from the SEC. Friends who have been following the news know that the SEC launched an investigation into Uniswap Labs as early as September 2021. The Wells Notice is just a natural consequence after some preliminary results of the investigation. After all, in this world, who can withstand a thorough investigation? As long as the investigation is conducted seriously, some unclear issues can always be found.
Since then, Uniswap Labs has also started a series of preparations, such as hiring a former spokesperson for Obama to handle public relations, establishing the DEF Fund to engage in political lobbying activities under the banner of education, and so on.
Of course, the SEC’s attitude towards the DeFi sector may not be very friendly. In the internal reference of Liu Jiaolian on June 17, 2023, it was mentioned that Gurbir Grewal, the head of the SEC’s enforcement division, made a surprising statement in an interview, saying that “DeFi provides services that are neither decentralized nor financial, and it is pure fraud.”
Now, Uniswap Labs can only defend itself and seek cover. After all, Ripple, who accepted the SEC’s challenge and initiated litigation, did not back down and eventually won.
This is also a significant test of the decentralization of the Uniswap protocol. The Uniswap protocol is not controlled by Uniswap Labs. The latter controls the website uniswap.org but does not control the Uniswap protocol.
If the strong pressure from the SEC can force Uniswap Labs, a centralized entity, to further weaken its control and decentralize resources, it may turn a bad thing into a good thing and find fortune in misfortune.
True decentralization must be able to absorb external shocks and turn them into internal strength. Just like the unprecedented large-scale attack on the Bitcoin hash rate network in 2021 by a major country, it was successfully absorbed and turned into a blessing. The hash rate network became more decentralized, and its value increased further.
However, those who were attracted by the two waves of UNI’s violent rallies in February and March, and rushed in with speculative fantasies of $50, $100, and $200, may once again panic and be at a loss.
Any purely speculative investment in price, if one does not truly understand the target and strategy, is highly likely to be cut off in the shuffle and leave the market with losses, even if the market eventually reaches the price target of the initial speculation, there will be no position left.
[Attachment 1: Supplementary reading, Uniswap Labs’ public defense against the SEC’s Wells Notice (English): [Insert link]]
[Attachment 2: Liu Jiaolian reminds everyone to beware of phishing and fraud activities at this time! It is best not to do anything. I have seen many fraudulent posts on Twitter using the panic of the SEC and Uniswap Labs’ war for phishing. Usually, they disguise themselves as the name and avatar of Uniswap Labs or its founder Hayden Adams, claiming that you should click the link to protect your funds in the Uniswap protocol or click the link to co-sign the protest against the SEC, etc., which are very easily deceiving messages. Once you click on it, the link will lead you to a malicious wallet and ask for authorization, and then your assets may be immediately stolen!]
Disclaimer: The content of this article does not constitute any investment advice. Cryptocurrencies are highly risky assets and have the risk of going to zero at any time. Please participate cautiously and take responsibility for yourself.
Tags:
SEC
Uniswap
Liu Jiaolian
Bitcoin
Opinion
Source link:
https://mp.weixin.qq.com/s/DpcJni0jW7bkA1IJbCjtnA
Note: The translation is solely the translator’s own work and does not represent any official statement.
