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The VeChain (VET/USD) price retreated on Thursday as worries of regulation rose ahead of the latest US inflation numbers. The coin’s price fell to $0.1135, down by more than 9% from the highest point today. Other cryptocurrencies like Bitcoin and Ether have also pared back some of the gains made on Wednesday.
Cryptocurrencies regulations
VeChain and other digital currency prices retreated as investors continued to focus on regulations, especially in the United States.
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This is after it emerged that JGB paid about $1 million to Russian hackers who compromised its systems last week. This became the biggest ransom paid to hackers after Colonial Pipeline paid $4 million last month. JGB, the biggest meat-packing company in the United States, paid this ransom using Bitcoin.
The voices calling for more regulations are getting louder. A few months ago, Janet Yellen, the current Treasury Secretary, said that the government should take more measures to curtail cryptocurrencies. And on Wednesday, Senator Elizabeth Warren asked Congress and other regulators to tighten regulations. She said:
“Cryptocurrency has created opportunities to scam investors, assist criminals, and worsen the climate crisis. The threats posted by crypto show that Congress and federal regulators can’t continue to hide out, hoping that crypto will go away. It won’t. It’s time to confront these issues head-on.”
Just last month, a Wall Street Journal columnist argued that the government should just ban cryptocurrencies to curtail ransomware. He argued that cryptocurrencies created value for no one other than speculators.
While VeChain has not been singled out, banning or putting more measures to regulate the industry would impact it. For one, cryptocurrencies are known for their close correlation. In other words, most altcoins fall when Bitcoin declines, and vice versa.
Inflation data ahead
Looking ahead, the VeChain price will react to the latest US inflation data that will come out during the American session. Analysts expect the data to show that the headline CPI rose from 4.2% in April to 4.7% in May. Similarly, core CPI is expected to have increased from 2.3% in March to 3.2% in May.
These are important numbers since they have an impact on interest rates. Ideally, if inflation is substantially higher than estimates, it means that the Fed could tighten faster than expected. Most notably, these numbers will come at the same time as the initial jobless claims numbers.
VeChain price forecast
The daily chart shows that the VET price has been in a tight range in the past few weeks. The price is below $0.1470, which was the neckline of the double-top pattern that happened a few months ago. It has also moved below the 50-day moving average and received support from the 200-day EMA. Also, the coin seems to be forming a bearish flag pattern. Therefore, there is a possibility that it will break out lower in the next few sessions.