Crypto glum
What's being bought and sold*
TOP TRENDING ASSETS
*Trading activity in the past 24 hours on the Uphold platform, as of 8 a.m. 16th April 2024.
The combined total of buy and sell percentages can exceed 100% due to customers who engage in both buying and selling the same asset within the 24-hour time frame.
Don’t invest in crypto unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong.
What’s up
Sell Pressure Increases In Step With Geopolitical Tensions, Rates, Gold
Concerns about persistent inflation keeping rates elevated – and now rising geopolitical tensions – have shredded cryptos across the board while shaking the conviction of even some of the more boisterous bulls as Bitcoin fell below $61,000. That low ebb came earlier today. BTC clung to $62,000 as of 9:15 a.m. (EST).
“Our growing concern is that risk assets – stocks and crypto – are teetering on the edge of a significant price correction," cautioned Markus Thielen, founder of 10X Research, in a note to clients.
"We may have arrived at a tipping point,” he said.
The yields on 10-year Treasuries remained steep, above the 4.66% level, as of early Tuesday. Most market participants now only envision a mere two rate cuts this year. Coming into 2024, two rate cuts were expected by June.
Reflecting macroeconomic consternation, precious metals prices surged on Monday.
The June contract for gold futures hit $2,383 per ounce, a record daily close. Spot prices for gold have risen 15% since the start of January versus a 6% increase for the S&P 500.
BTC is up 42% YTD.
What's down
Most Coins Battered On A Tuesday To Forget
Digital markets seemingly could care less about Bitcoin's impending halving.
Total cryptocurrency assets fell 5% in the past day to settle at $2.4 trillion.
Inflows into spot ETFs have ground to a halt, as in, literally, the five-day average of net inflows into the recently birthed BTC ETFs fell to zero (CoinDesk).
Among Big Ten coins, Toncoin and Solana were hardest hit, each down 12% in 24 hours as of about 8 a.m. (EST).
XRP dipped below 50 cents.
Numerous coins have lost 30% or more in the past week. Gala (GALA), a decentralized gaming project which pumped crazily at the start of the year and constantly "trending" on the back of some metaverse or GameFi narrative, has taken a uniquely nasty tumble, down 39% in the past week.
Meanwhile, Bored Ape NFT prices have completely bottomed out, down 90% from their summer of 2022 peak.
What's next
Bitcoin's Mixed Bag Of Gloom, Doom – And Potential Boom
Tensions in the Middle East so far have not caused oil prices to spike. Even dire strait (of Hormuz) supply fears can't compete with demand shrinkage suspicions, which in turn owe to the realization that the Federal Reserve plans to leave rates higher for longer as a kind of governor on a hotrod engine.
Bitcoin's supply, meanwhile, is definitely about to dwindle. No guesswork required. The halving event, set to take place perhaps as early as Friday, reduces miners' rewards, from 6.25 BTC to 3.125 BTC.
Past halvings have proven terrific for the biggest crypto and this particular halving was thought to be coming at a particularly opportune time considering the rise of BTC ETFs and the lingering prospect for at least some monetary loosening (maybe, slightly) as well as now some fresh thinking about how investors might behave if simmering global tensions should indeed boil over.
At the moment, worst-case fears are in check. Israeli officials are mum about plans for retaliation against Iran, other than to say all options are on the table. Allies are urging restraint, advocating for a limited response.
"Tensions are high," Rystad Energy's Jorge León told Reuters. "Next moves are hard to predict."
U.S. stock futures are in the green ahead of Tuesday's open. Gold seems poised to continue to climb.
And BTC could conceivably still catch end-times tailwinds with investors continuing to diversify away from traditional financial assets, points out Edouard Hindi, CIO, Tyr Capital.
“BTC remains a viable doomsday asset in 2024," Hindi said.
