Ether continues to slide as investors shift to a wait-and-see approach regarding future upgrades, the bank said in a research report.

Digital assets continue to act as risk assets, falling as global interest rates rise, Bank of America (BAC) said in a research report Friday.

Still, positive signs of an eventual recovery include stablecoin inflows. Stablecoins are a type of cryptocurrency whose value is pegged to another asset, such as the U.S. dollar or gold.

Last week these inflows jumped to $490 million, 58% higher than the previous week, the report said, as “real world use cases like payments/remittances are adopted and real-world data providers like decentralized oracle networks increase functionality.”

The four largest stablecoins witnessed exchange net inflows for the third week in a row, the report said, noting that large Binance USD (BUSD) inflows/USD Coin (USDC) outflows could be the result of investors “preemptively rotating” into BUSD from USDC to avoid disruptions following Binance’s decision to auto convert some stablecoins into its own stablecoin.

Bank of America expects regulatory clarity to support decentralized finance adoption. DeFi is an umbrella term used for lending, trading and other financial activities carried out on a blockchain without the use of traditional intermediaries.

The jump in ether’s (ETH) price from mid-July to mid-August continues to reverse as investors digest that the Ethereum blockchain’s switch to proof-of-stake (PoS) does not fix scalability concerns or high fees, and these investors shift to a “wait-and-see approach regarding future upgrades,” the note said.

The transition from proof-of-work (PoW) to a more environmentally friendly proof-of-stake consensus mechanism is the first of five upgrades for the Ethereum blockchain, a process that was called the Merge.

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Crypto traders on government-approved exchanges will be exempt from a 7% VAT tax, the country’s finance minister said at a cabinet meeting.

Thailand is relaxing tax rules for crypto trading until the end of 2023 in order to boost the industry, the country’s finance minister said at a cabinet meeting on Tuesday.

Starting April 1, trades of digital assets on government-approved exchanges will be exempt from a 7% value-added-tax (VAT), said the minister, Arkhom Termpittayapaisith, according to the meeting minutes posted on the government’s website. Transfers involving Thailand’s retail central bank digital currency will also be exempt from the VAT over the same time period, he said.

Traders will also be able to deduct losses from crypto trading from taxes due on gains, the minister said.

A draft decree of the new tax exemptions has been proposed under Thailand’s Revenue Code, said Ekniti Nitithanpraphas, general director of the finance ministry’s revenue department, according to the meeting minutes. The draft aims to increase the competitiveness of the industry and develop payment system infrastructure that is ready for the digital economy, he said.

In January, the government scrapped a proposed 15% tax on crypto gains following pushback from traders.

Crypto trading has been growing over the past year in the second-largest Southeast Asian economy, with the number of new crypto investors reportedly outpacing new stock market traders in September.

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