The latest moves in crypto markets, in context By Jamie Crawley, CoinDesk reporter Was this newsletter forwarded to you? Sign up here. |
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Welcome to the start of a new week! Here's what's happening in crypto today: |
- More traders are betting bitcoin's price will drop.
- Liquid staking overtakes decentralized lending in total value locked.
- Voyager Digital creditors may not gain much from sale to Binance.US.
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CoinDesk just launched The Airdrop, a Web3 newsletter breaking down the biggest news related to internet culture, NFTs, DAOs and the metaverse |
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CoinDesk Market Index (CMI): 1,106 +1.0%
Bitcoin (BTC): $23,391 +0.9%
Ether (ETC): $1,639 +2.4%
S&P 500 futures: 3,996.25 +0.5%
FTSE 100: 7,940.50 +0.8%
Treasury Yield 10 Years: 3.95% +0.1 |
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Short-bitcoin funds saw inflows of $10 million last week compared with outflows of $12 million from long positions, according to crypto asset manager CoinShares, as upbeat U.S. economic data weakened investors' appetite for risky assets. BTC fell below $23,000 on Saturday, its lowest point since Feb. 15. Short-bitcoin funds, which profit from a decline in the price of BTC, saw inflows last week while the price of bitcoin fell over 3% after it failed to consolidate above $25,000. "We believe this reaction reflects nervousness amongst U.S. investors prompted by the recent stronger-than-expected macro data releases, but also highlights its sensitivity to the regulatory crackdown in the U.S.," CoinShares said in a weekly report. |
Gumenyuk Dmitriy/Shutterstock |
Liquid staking is the new second-largest crypto sector, overtaking decentralized lending and borrowing. Liquid staking is now a $14.1 billion sector based on the total value of assets that have been locked on blockchain networks by users in return for rewards. Decentralized lending and borrowing protocols have $13.7 billion locked, while decentralized exchanges remain the largest sector with $19.4 billion. The upcoming Shanghai software upgrade on the Ethereum blockchain is seen as the catalyst for the rise of liquid staking because it will enable stakers to withdraw the ether they have staked and accumulated rewards on for the first time. Texas regulators have said the benefits to creditors from Binance.US' proposed acquisition of bankrupt lender Voyager Digital may be negligible. A court filing Friday said the benefits hinge on whether Alameda Research is successful in recovering $446 million transferred to Voyager prior to its own bankruptcy. The court document also detailed concerns over Binance's staking program, which it said appears to constitute an illegal securities offering. Alameda Research is a trading firm affiliated with collapsed crypto exchange FTX. It was also owned by FTX founder Sam Bankman-Fried. |
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Market Insight: Traders Feast on Stacks |
Stacks Networks' tokens are surging as investment funds use the smart contract-focused layer 2 companion chain to the Bitcoin network to bet on BTC's growth. Stacks' STX tokens have jumped 23% in the last 24 hours, continuing the upward trend which has seen them grow 50% over the last week, according to data by CoinGecko. The momentum comes courtesy of the Ordinals protocol, which allows users to inscribe references to digital art into small transactions on the Bitcoin blockchain. Investment manager North Rock Digital recently noted that Stacks' focus on decentralized finance (DeFi), use of smart contracts and Bitcoin compatibility set it apart from other blockchain projects. |
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- The chart shows bitcoin's 30-day rolling correlation with Ethereum's native token ether, the second-largest cryptocurrency by market value.
- The correlation between the two has strengthened since mid-January, a sign of renewed focus on macroeconomic factors.
- Traders' appetite for risky assets has weakened, with U.S. Treasury yields rising in response to rates. Traders are pricing three more 25 basis point rate hikes from the Federal Reserve in March, May and June.
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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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