  The latest moves in crypto markets, in context Edited by Omkar Godbole December 14, 2021 Sponsored by  Bitcoin (BTC) See the latest price here Ether (ETH) See the latest price here If you were forwarded this newsletter and would like to receive it, sign up here.
Good morning, and welcome to First Mover. Here's what's happening this morning:
And check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9:00 a.m. U.S. Eastern time.
– Omkar
Market Moves by Omkar Godbole While bitcoin held the 200-day average support early Tuesday, caution ahead of Wednesday's Fed meeting kept gains under check.
Action in derivatives was consistent with the dour mood in the market with the one and three-month futures on the Chicago Mercantile Exchange, a proxy for institutional demand, slipping into backwardation for the first time since May. Options market saw call selling at $50,000, $60,000 and $70,000 strikes.
Ether CME futures also slipped into backwardation, a situation where contracts trade at a discount to the spot price, hinting at a weak buying pressure from sophisticated investors.
MATIC Burn?
Scaling solution Polygon's MATIC token rose nearly 3% as the core development team announced a testnet implementation of Ethereum Improvement Proposal (EIP)-1559 to introduce a mechanism to burn MATIC.
According to official estimates, the number of coins burned annually will represent 0.27% of MATIC's total fixed supply of 10 billion. "Deflationary pressure will benefit both validators and delegators because their rewards for processing transactions are denominated in MATIC," the official blog said.
Ethereum's blockchain has burned more than one million ether since the activation of EIP-1559 on Aug. 5 and has brought a store of value appeal to the cryptocurrency.
Dogecoin rallies
Joke cryptocurrency DOGE surged over 20% after Tesla's CEO Elon Musk said the electric carmaker would accept dogecoins as payment for its merchandise. Musk, a long-time dogecoin, said Monday that the meme coin is better than bitcoin as a transactional currency.
"Fundamentally, bitcoin is not a good substitute for transactional currency," Musk told Time Magazine after being named Time Magazine's 2021 Person of the Year. "Even though it was created as a silly joke, dogecoin is better suited for transactions."
A few weeks ago, Musk perhaps made a similar pitch for dogecoin being a cheaper payments currency in a tweet response to CoinDesk's article about high Ethereum fees restricting retail investors from accessing decentralized finance.
The broader crypto market was a sea of red, with layer 1 coins AVAX and ATOM ranking high on the list of biggest losers. Crypto's inability to follow last week's equity market rally perhaps indicates the asset class is at the far end of the risk curve and relatively more sensitive to prospects of Fed tightening.  The dollar index's (DXY) ascent looks to have stalled; a sign the market may be done pricing in Fed's impending hawkish announcement. As such, the cryptocurrencies could see a relief rally. Read the full story here: Bitcoin CME Futures Slip Into 'Backwardation' as Bearish Sentiment Grips Market
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Biggest Movers
These are the biggest movers in the CoinDesk 20 over the past 24 hours:
Top Gainers:
Top Losers:
The CoinDesk 20 are 20 digital assets filtered from the larger universe of thousands of cryptocurrencies and constitute roughly 99% of the market by volume at eight of the largest and most trustworthy exchanges.
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Technician's Take
by Omkar Godbole
Ether Holds Bullish Trendline
Ether's daily chart (Source: TradingView)
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Ether looks south, having violated the five-month bullish trendline and the 100-day moving average support.
- The cryptocurrency has also found acceptance under the long-held support near $3,900.
- The breakdown is backed by a bearish reading on the relative strength index and may encourage more selling.
- Deeper decline, if any, may find support of the 200-day average, currently near $3,250.
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ICYMI
In case you missed it, here are the most recent episodes of "First Mover" on CoinDesk TV:
Blockchain Unicorn Watch, Lesson Learned From BadgerDAO's $120M Hack and More
"First Mover" hosts speak to Jonathan Manzi, CEO of Beyond Protocol, a blockchain project that focuses on trust and security, as BadgerDAO recently revealed details of how it was hacked for $120 million. Crypto market insights from Eaglebrook Advisors' Director of Research Joe Orsini. Plus, what blockchain unicorns have emerged in North America this year? Blockchain Coinvestors Managing Partner Matthew Le Merle gives the detail from his list.
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Latest Headlines
- Avalanche, Cosmos Lead Crypto Losses Amid Altcoin Purge
Crypto markets were bathed in red on Tuesday as weakening technical signals and macroeconomic factors came into play.
- Sportswear Giant Nike Purchases NFT Fashion and Collectibles Startup RTFKT
Nike is making a major move into the metaverse with the acquisition of a leading digital apparel player.
- Infinite Games: How Crypto Is 'LARPing'
Crypto communities are playing a big series of "live action role playing games," and they're changing how we organize and interact across digital and physical spaces.
- Vulcan Forged Play-to-Earn Gaming Platform Refunds Users After $140M Hack
PYR token prices fell 34% to $21 on Monday following news of the hack.
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Robinhood Working on New Crypto Gifting Feature: Report
The no-fee trading platform is testing a feature that allows users to send crypto to other users as a gift, according to Bloomberg.
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.
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