Bitcoin Falls on Liquidity Concerns, Ether Falls; Polkadot leads the winners; US stock futures rise
Bitcoin fell on Thursday morning in Asia to trade around $27,500, after breaching $28,000 on Wednesday as US inflation eased. Liquidity is becoming a concern after major market makers Jane Street Group and Jump Crypto stopped trading cryptocurrency in the US citing unfavorable regulations. Ether led the losers in the top 10 non-stablecoin cryptocurrencies, while Pokadot led the gainers. U.S. stock futures traded higher as inflation eased in April, adding to speculation that the Federal Reserve may pause rate hikes in June.
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Bitcoin, Ether losing ground
Bitcoin fell 0.60% to US$27,554 in the 24 hours to 08:30 in Hong Kong, according to CoinMarketCap data, recording a weekly loss of 5.24%.
The world’s largest cryptocurrency briefly breached the $28,000 ceiling on Wednesday as crypto markets rallied on a slower rate of US inflation, but soon fell back amid concerns about network congestion and liquidity.
Jane Street Group and Jump Crypto, two leading market players, will cease digital asset trading in the United States as regulators crack down on the industry, according to a Bloomberg report citing unnamed sources.
“After the collapse of several crypto-friendly banks and FTX, it seems that the SEC (regulator) is unsure which leg to stand on, and that the attitude has become more hostile to crypto and the entire financial and technical ecosystem around it,” Mikkel Morch , chairman and non-executive director of digital investment fund ARK36, said in an email.
As of 8:30 a.m. in Hong Kong, investors liquidated $41.28 million in Bitcoin positions, nearly 75% of which were long positions — or bets that the price of Bitcoin would rise, according to market data tracker CryptoMeter.io.
Ether fell 0.84% to $1,837, down 3.49% for the week. The token approached USD 1,900 on Wednesday before falling back to as low as USD 1,795.
Other top 10 non-stablecoin cryptocurrencies traded mixed, with Polkadots Dot token leading the gainers with a gain of 1.91% to $5.45. However, it is down 5.43% for the week. The Web3 Foundation, the organization behind the Polygon blockchain, testified Wednesday before the US Congress on digital asset regulations, calling for clearer rules of the road.
The total crypto market cap fell by 0.30% in the last 24 hours to $1.14 trillion. Total trading volume increased by 43.61% to $45.84 billion.
NFT index falls
The indices are proxy measures of the performance of the global NFT market. They are managed by CryptoSlam, a sister company of Forkast.News under the Forkast.Labs umbrella.
In the non-fungible token (NFT) market, the Forkast 500 NFT index fell 0.67% to 3,440.57 in the 24 hours to 10:00 a.m. in Hong Kong, losing 6.15% for the week.
Milady Maker, an Ethereum-based NFT pool, topped 24-hour sales across the market after Elon Musk, CEO of Twitter and Tesla, tweeted Wednesday an image containing NFT.
Milady Maker’s sales totaled over $9.54 million in the past 24 hours, an increase of over 3,700%, according to data from CryptoSlam, with the floor price jumping 38.4% to 4.69 ETH ($8,609), according to CoinGecko.
Boosted by the rise of Milady Maker, NFT sales on the Ethereum blockchain jumped 89.41% in the last 24 hours to $34.25 million, according to CryptoSlam. Average transaction fees on Ethereum came in at $19.70 on Wednesday, down from an 11-month peak of $27.68 on Saturday, according to blockchain data platform BitInfoCharts.
Stock futures rise when inflation slows
US stock futures rose from 11:00 a.m. in Hong Kong. Dow Jones Industrial Average futures rose 0.04 percent. S&P 500 futures rose 0.19%. And Nasdaq Composite futures rose 0.16%.
The three U.S. indexes closed mixed in regular trade on Wednesday as investors digested a U.S. consumer price index report that showed annual inflation unexpectedly fell to 4.9% in April from 5% in March, the slowest pace in two years. The moderate cooling in inflation indicates that the Federal Reserve may be taking a break from its more than year-long cycle of raising interest rates to curb inflation.
In talks to raise the U.S. debt ceiling to keep the nation solvent, President Joe Biden warned Wednesday that a federal government default could trigger a global recession, according to a Bloomberg report. Biden is set to resume talks to raise the debt ceiling on Friday, with congressional Republicans demanding more budget cuts in any deal.
In other data releases, the US producer price index and jobless claims are out on Thursday to provide further insight into the health of the economy.
The Federal Reserve meets on June 14 to decide its next move on interest rates, which are now between 5 and 5.25%, the highest since 2006. The CME FedWatch Tool predicts a 96.1% chance the Fed will keep rates unchanged in June , and a 3.9% chance of another rate hike of 25 basis points, down from 21.2% on Wednesday.
(Updates with the stock section.)
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