Good Evening. On Monday, U.S. stocks fell into a bear market, with speculators betting that a new decades-high inflation reading will force the Federal Reserve to act even more aggressively than expected to help reduce increasing costs.
By market closing, the Nasdaq had dropped 4.68% to 10,809.23, its lowest level since September 2020. The S&P 500 ended the day down 3.88% and the Dow ended at 2.79% in the red.
With news that it was stopping all withdrawals, swaps, and transfers between accounts “due to extreme market conditions,” crypto lending platform Celsius Networks LLC sent shockwaves through an already shaken digital asset market to start the week. “We are taking this action today to put Celsius in a better position to honor, over time, its withdrawal obligations,” the New Jersey-based company said.
The company has been keeping an eye on the latest developments in the Celsius case. It is “mindful of the detrimental repercussions for retail investors and the blockchain community at large.” Nexo claimed to be in a “strong liquidity and equity position” to help mitigate the effects of Celsius’ financial situation.
Some users recently blamed Celsius for heavy financial losses by pushing them to keep its CEL digital tokens as collateral for loans — CEL was down 47% on Monday and has lost more than 74% of its value over the previous month, and 97% over the past year, according to CoinGecko data.
What about the rest of the industry? The cryptocurrency industry has taken a beating this year, with the whole crypto market down more than 40% in the last two months. Bitcoin is now trading at a level not seen since late 2020, having lost 48% of its value this year and more than 60% since its all-time high in November.
A bipartisan group of senators has struck an agreement on a gun safety framework that includes expanded background checks for people under the age of 21, financing for mental health and school safety, and state grants for “red flag” laws.
Why it matters: While the agreement falls short of what many Democrats desire, it would be the most important gun safety legislation in decades if it were to succeed.
The proposal includes an improved review procedure for buyers under the age of 21, which will require buyers under the age of 21 to go through an investigation period to review juvenile and mental health records, as well as checks with state databases and local law enforcement.
“Families are scared, and it is our duty to come together and get something done that will help restore their sense of safety and security in their communities,” the senators said in a joint statement.
THE WEEK AHEAD
Fed meeting: On Wednesday, the central bank is expected to announce a significant interest rate hike to combat inflation, which is nearing a 41-year high. But what Powell says regarding the extent and timing of future rate hikes will likely pique investors’ curiosity even more.