Crypto News: Moody’s Analytics Launches AI Product to Predict Stablecoin Depegs

Key Insights:

• BTC and ETH continued to move sideways as investors awaited fresh updates on the crypto-spot ETF applications.
• Product ingenuity grabbed the headlines on Monday, with Moody’s Analytics launching a new AI-driven stablecoin predictor tool.
• On Tuesday, BTC-spot ETFs remain the focal point. A lack of progress toward SEC approvals could test investor sentiment.

Moody’s Analytics Launches Service to Predict Stablecoin Depegging

On Monday, Moody’s Analytics launched the Digital Asset Monitor (DAM). DAM uses AI to monitor risk and volatility within the DeFi space, incorporating numerous data sources.

According to the press release, DAM will signal the chances of a stablecoin depegging from a fiat over 24 hours. DAM will monitor 25 fiat-backed stablecoins, including PayPal Coin (PYUSD), Tether (USDT), and USD Coin (USDC).

Senior Director of Product Innovation Yiannis Giokas discussed the market and DAM, saying,

“We have seen the stablecoin market grow into a multibillion-dollar asset class accounting for about 10 percent of the crypto market and most on-chain activity. However, given ongoing volatility in the asset class, we saw substantial demand from our customers to fill a gap in this space with a comprehensive risk assessment tool for digital assets. The tool was built in a year using agile-development frameworks to address customer needs.”

DAM has favorable capabilities for the crypto market and stablecoin holders. The product will detail the stability of a stablecoin issuer, list the custodians that hold the assets, and assess the quality of the reserves.

Embracing the DeFi space, Moody’s Analytics also announced the launch of DeFi Communities. DeFi Communities gives DAM users a platform to share and exchange views and ideas.

Stablecoin Depegs Continue Unnoticed

According to Moody’s Analytics, large-cap fiat-backed stablecoins have depegged 609 times year-to-date. Moody’s defines a depeg as a greater than 3% movement against the fiat currency peg.

Stablecoin depeggings caused a crypto market panic in May 2022. TerraUSD (UST) peg against the USD shattered, with UST tumbling to $0.1977. Tether added to the market crypto volatility, falling to $0.986 levels. The crypto market responded, with the total crypto market cap losing $268 million over 24 hours.

The influence of stablecoins on the crypto market reflects the need for products to predict possible depeggings and assess stablecoin quality.

Technical Analysis

Bitcoin Analysis

BTC held above the 50-day and 200-day EMAs.

A BTC break above the $35,265 resistance level would give the bulls a run at the November 2 high of $36,024 and the $36,400 resistance level.

BTC continues to move sideways as investors await SEC approvals of BTC-spot ETFs. An SEC approval of one, some, or all the BTC-spot ETFs could support a move toward $40,000. However, BTC is exposed to the threat of the SEC disapproving the spot ETF filings.

A BTC fall below $34,000 would bring the $32,436 support level into play.

The 14-Daily RSI reading of 73.91 shows BTC sitting in overbought territory. BTC may continue to face intensifying selling pressure at the $35,265 resistance level.

Ethereum Analysis

ETH remained above the 50-day and 200-day EMAs.

An ETH return to $1,900 would support a break above the $1,926 resistance level and bring $2,000 into play.

However, a fall through the trend line would bring the $1,805 support level into view. A break below the $1,805 support level would give the bears a run at sub-$1,750.

The 14-period Daily RSI of 71.71 shows ETH in overbought territory. Without a favorable crypto event, selling pressure may continue to leave ETH short of the $1,926 resistance level.