As the financial market closely follows the major regulatory policy adjustments of the US Securities and Exchange Commission (SEC), the cryptocurrency market has also experienced significant fluctuations. According to Golden Finance, the price trend of the cryptocurrency AAVE has undergone a sharp change and has fallen below the $290 mark. The current quote is $289.97. In the past 24 hours, the price of AAVE has dropped by 4.52%, showing significant market fluctuations. Investors need to be highly vigilant and take good risk management measures.
The SEC has recently officially repealed the extended “Custody Rules” proposal and a series of Gensler-era rules such as “Rule 3b-16”. The impact of this move on the cryptocurrency market is gradually emerging.
The expanded “Custody Rules” proposal, which originally planned to bring all client assets such as cryptocurrencies under regulatory control and redefine the concept of “custody”, has sparked widespread industry discussions on whether state-licensed entities can serve as qualified custodians. The “Rule 3b-16” aims to bring decentralized finance (DeFi) exchanges/platforms under the regulatory jurisdiction of national stock exchanges, exerting significant compliance pressure on the emerging DeFi industry. Although the abolition of these two rules is regarded by some market participants as a positive signal of industry relaxation, the overall market response remains rather complex.
As an important cryptocurrency in the DeFi field, the price trend of AAVE is closely related to the regulatory dynamics of the industry. After the SEC announced the abolition of relevant rules, the uncertainty in the market regarding the regulatory outlook for cryptocurrencies increased, and investor sentiment fluctuated accordingly. Some investors are concerned that after the rules are abolished, the market may lack clear regulatory guidance in the short term, leading to an increase in risks and thus choosing to sell off cryptocurrencies such as AAVE, causing prices to fall. On the other hand, although the abolition of rules theoretically provides space for innovation in the DeFi industry, the market needs time to digest this policy change. During this period, the wait-and-see sentiment dominates and also exerts downward pressure on the AAVE price.
Apart from the adjustment of SEC rules, the current cryptocurrency market as a whole still faces many unstable factors. The uncertainty of the global macroeconomic environment, the differences in regulatory attitudes towards cryptocurrencies among countries, and the high volatility of cryptocurrencies themselves are all influencing investors’ decisions. Under such a macro environment, the significant fluctuations in AAVE’s price also reflect the vulnerability of the cryptocurrency market.
Looking ahead, as the SEC’s regulatory policies become more clear, the cryptocurrency market is expected to gradually stabilize. However, in the short term, investors still need to closely monitor market dynamics, prudently deal with the significant fluctuations in the prices of cryptocurrencies such as AAVE, and reasonably adjust their investment portfolios to avoid potential risks.
Meanwhile, major news has also come from the international political and military situation. At 1:00 a.m. local time on June 13th, the Israeli Ministry of Defense made a high-profile announcement that Israel had launched a strike against Iran. Israeli Defense Minister Katz later said that Israel had carried out air strikes on Iran. He further pointed out that after launching this preemptive strike, it is expected that Israel will suffer missile and drone attacks from the Iranian side in the near future.
According to on-site information, continuous explosions were heard in Tehran, the capital of Iran, when the attack occurred. As of now, the Iranian authorities have not made a public response to the cause of the explosion and related circumstances. Israel’s recent strike against Iran has undoubtedly escalated the already tense situation in the Middle East further, drawing widespread attention from the international community.
Previously, CBS of the United States had quoted US sources as reporting that Israel was fully ready to launch a military operation against Iran. Although Israeli officials refused to comment on this at that time, the operation has now begun. Behind this military strike, geopolitical factors are intricate and complex. Iran has long supported several hostile forces towards Israel, including the Palestinian Hamas organization. Israel has always regarded Iran as a major security threat to it in the Middle East, especially on the Iranian nuclear issue. Israel has always remained highly vigilant, fearing that Iran’s successful development of nuclear weapons would pose a fatal threat to its national security.
Furthermore, a series of recent actions by the United States in the Middle East have also laid the groundwork for this conflict. The US State Department ordered all non-essential personnel of the US embassy in Iraq to evacuate. Pentagon officials also released a statement saying that the families of US troops in Bahrain could temporarily leave the country. Us Defense Secretary John Hegerseth authorized the families of US troops in various parts of the Middle East to “voluntarily evacuate”. These actions all indicate that the tension of the situation in the Middle East is constantly rising.
When responding to questions about Iran, US President Trump said that it might become very dangerous there and the United States has informed the relevant personnel to evacuate. Although Trump said he preferred to avoid conflict with Iran and expected to reach a peaceful solution to its nuclear program, Israel’s military operation this time undoubtedly added more uncertainties to the regional situation.
It is worth noting that Iran and the United States were originally scheduled to hold a new round of indirect negotiations in Oman on June 15th, aiming to resolve their differences on issues such as the nuclear issue. However, Israel’s sudden attack is likely to have a significant impact on this negotiation, making the already complex process of resolving the Iranian nuclear issue even more confusing.
As Israel’s strikes against Iran continue, where the situation in the Middle East will head, whether the global financial market will be further impacted by the escalation of regional conflicts, and especially how the cryptocurrency market and traditional financial market will perform in the turbulent situation have all become the focus of attention from all sectors. Just as all parties were closely watching the development of the situation, the US stock market was the first to show a violent reaction.
According to the latest report from Golden Finance, due to the news that Israel is targeting Iran, the short-term decline of the three major US stock indices has rapidly expanded to 1%. Market panic has risen significantly, and investors have been reassessing risks one after another. In the current context of a sharp increase in geopolitical risks, the demand for capital as a safe haven has soared. A large amount of capital has flowed out of the stock market and turned to seek safer asset havens.
Previously, market concerns over the situation in the Middle East had to some extent suppressed the upward potential of the US stock market. This direct strike by Israel against Iran undoubtedly adds insult to injury to the already fragile market confidence. From the perspective of sector performance, the energy sector has seen a divergence due to expectations of oil price fluctuations. The share prices of some enterprises that rely on energy supplies from the Middle East have come under pressure and declined. The military industry sector has been favored by funds and has shown an upward trend against the odds. In terms of technology stocks, due to the high degree of globalization in the supply chains of technology enterprises and their sensitivity to geopolitical risks, the share prices of most technology stocks have declined along with the broader market.
Furthermore, analysts point out that the decline of the US stock market not only reflects the uncertainty of the current situation in the Middle East, but may also indicate a downward revision of global economic growth expectations. Once the conflict in the Middle East escalates further, the oil supply will face the risk of disruption, which will trigger significant fluctuations in global energy prices and subsequently have a severe impact on the global economic recovery. At that time, the US stock market may face a more significant adjustment. This newspaper will continue to follow up and report on the subsequent trend of the US stock market and how the global financial market will respond to this geopolitical crisis.
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