Bitcoin regains $27,000 amid encouraging macro, technical signs
Good morning. Here’s what happens:
Prices: Bitcoin traded above $27,000 to regain some lost ground from last week’s plunge.
Insight: The drop in stablecoin supply rate over the past 11 days suggests a potential increase in the purchasing power of stablecoins.
Prices
CoinDesk Market Index (CMI)
1,158
+8.4 0.7%
Bitcoin (BTC)
$27,165
+433.8 1.6%
Ethereum (ETH)
$1820
+23.6 1.3%
S&P 500
4,124.08
−6.5 0.2%
Gold
$2020
+5.4 0.3%
Nikkei 225
29,388.30
+261.6 0.9%
BTC/ETH prices per CoinDesk indices, as of 07:00 ET (11:00 UTC)
Hopeful signs for BTC at $27K
After seven days of falling prices, bitcoin stabilized.
The largest cryptocurrency by market capitalization recently traded at around $27,165, up 1.1% over the past 24 hours and slightly above where it stood when the weekend began. BTC is still down more than 10% since May 5 when it started its latest swoon, a result of profit-taking and low liquidity against a backdrop of industry-focused and macroeconomic uncertainty.
“Financial markets in general (are) driven by risk, by liquidity, and so, not surprisingly right now, when people fear risk assets as a whole, we’re seeing a lot of selling,” crypto analyst Ryan Rasmussen. fund manager Bitwise, told CoinDesk TV’s “First Mover” program on Friday.
“When there’s less liquidity, you’re going to have bigger swings in price every time an asset (is) sold.” But he added: “There will be more liquidity coming into crypto.”
Ether, the second-largest crypto by market capitalization, changed hands near $1,800, down a few fractions of a percentage point and roughly the same level as early Saturday. Other major cryptos moved into green territory as the Asian trading week began with Litecoin recently up more than 5.7%. The CoinDesk Market Index, a measure of crypto market performance, was up 0.8%.
Leading Asian indices were mixed with the Nikkei up approx. 0.5%, while the Hang Seng down 0.2%. Rasmussen noted the diminishing correlation between crypto and traditional asset markets, which was mixed last week with the tech-heavy Nasdaq Composite up slightly over the past five days, while the S&P 500 and Dow Jones Industrial Average (DJIA) fell 0.2% and 1.1 %, respectively
“Any kind of mistrust of traditional financial systems plays into the hands of crypto,” Rasmussen said, adding: “I’m happy to see the correlation falling between traditional risk assets, traditional stocks and crypto.”
In an email to CoinDesk, Joe DiPasquale, CEO of crypto fund manager BitBull Capital, noted that the current “macroeconomic situation around the world creates an environment conducive to crypto assets thriving.”
This week, DiPasquale sees bitcoin’s price holding steady in a range between $25,000 and $27,000 “before bouncing back toward $30K.”
“We don’t think the market needs a catalyst in the immediate term,” he wrote. “It’s only a matter of time before we see another big rally.”
Biggest winners
Biggest losers
Insight
What Does the Recent Stablecoin Supply Ratio Mean for Bitcoin?
The Stablecoin Supply Ratio (SSR) has fallen approximately 11% over the past 11 days, indicating a potential increase in buying pressure for bitcoin.
The metric, which measures the ratio of bitcoin’s market cap to the market cap of stablecoins, provides insight into the supply-and-demand dynamic between stablecoins (used as a vehicle to buy cryptocurrencies) and BTC itself.
A higher SSR indicates that purchasing power is weakening, while lower values indicate that purchasing power is increasing.
The latest SSR drop follows a 52% increase between March and May 5. The pivot indicates that additional cash or liquid reserves have entered the market, and could lead to higher BTC prices.
Important events.
15:00 HKT/SGT (7:00 UTC) Eurogroup meeting
16:30 HKT/SGT (8:30 UTC) Hearings on the Bank of England’s Monetary Policy Report
17:00 HKT/SGT (9:00 UTC) Eurozone Industrial Production sa (MoM/March)
CoinDesk TV
In case you missed it, here’s the latest episode of “First Mover” on CoinDesk TV:
Bitcoin Touches 2-Month Low; Do Kwon Set to be released from Montenegro prison
Bitcoin (BTC) continued to lose ground in the wake of CoinDesk’s Bitcoin Trend Indicator, shedding the bullish bias for the first time in three weeks. Bitwise cryptoanalyst Ryan Rasmussen shared his market analysis. Separately, Terraform Labs founder Do Kwon was set to be released from Montenegro prison on supervised bail as his document forgery trial continues. Additionally, Chia Network CEO and President Gene Hoffman discussed plans for the blockchain and smart contract platform to go public. Operations manager for the Wormhole Foundation Dan Reecer also joined the conversation.
Headings
Binance announces exit from Canada, citing regulatory tensions: The world’s largest crypto exchange by volume said new guidance related to stablecoins and investor limits led to the exit.
Ethereum resumes finalizing blocks after second performance hiccup in 24 hours: When blocks are not finalized, it is possible that pending transactions may be reordered or dropped from the network. Developers have not determined the source of the outages, but they are asking for calm amid the worry and uncertainty.
Among Bitcoin developers, the debate rages on whether to censor Ordinal’s BRC-20s: Despite calls for censorship, many developers agree that maintaining the status quo is the right thing to do for now.
MakerDAO Founder Proposes Plan for Upgraded Versions of DAI Stablecoin, Governance Token: Rune Christensen also suggested incorporating artificial intelligence-assisted processes into Maker’s management.
House Democrats Consider New Stablecoin Bill, Source: The proposal comes weeks after Republicans introduced their own discussion draft of a new bill.
