Bitcoin stuck at US$28,000 amid signs of slowing economies
Bitcoin, the world’s largest cryptocurrency by market capitalization, fell 0.96% from March 31 to April 7 to trade at $27,916 at 9:15 p.m. Friday in Hong Kong. Ether rose 2.54% over the same period to $1,854.
This week, worries about bank failures were replaced by concerns about a US recession. Nonfarm payrolls rose by 236,000 in March, close to the 239,000 expected by economists polled by Reuters. This was the lowest monthly gain since December 2020, which could indicate a slowing economy.
According to the International Monetary Fund, global GDP is expected to grow by around 3% over the next five years, below the 20-year average of 3.8%.
Kadan Stadelmann, CTO of blockchain infrastructure development firm Komodo, said Bitcoin is still suffering from bear market blues and price trends are mixed.
“Typically, we see risk on conditions as something that drives up the Bitcoin price. But over the last month with the banking crisis, we’ve actually seen that risk is positive for Bitcoin. Right now, the price action is telling us that the market is a draw,” Stadelmann said in a statement shared with Discard.
Stablecoin reserves on exchanges continued to fall this week, hitting a two-year low of $18.06 billion, according to data from analytics platform CryptoQuant, suggesting crypto market liquidity is drying up following the closure of three major crypto-focused banks in the US
Tether’s USDT added more than US$1 billion to its stablecoin-leading market capitalization this week, raising it to US$80.27 billion. Its market cap is up 11.92% in the past month, while rival USDC has fallen 25.03% to $32.41 billion, as BUSD lost 15.91% to $7.09 billion, according to DefiLlama.
The global crypto market capitalization stood at $1.18 trillion on Friday at 9:15 p.m. in Hong Kong, the same value it had a week ago, according to CoinMarketCap data. Bitcoin’s market cap of US$539 billion accounted for 45.9% of the market, while Ether’s US$223 billion accounted for 19%.
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Biggest winners: INJ & ENJ
INJ, the initial token of Injective, a layer-1 smart contract blockchain for financial apps, was this week’s biggest gainer among the top 100 coins by market capitalization listed on CoinMarketCap. INJ rose 23.17% in the last week and traded at $5.77. The token started gaining momentum in early March since the launch of the ongoing Injective Global Hackathon.
Enjin Coin, the utility token of Enjin, a blockchain platform that builds non-fungible token solutions, was the week’s second biggest gainer in the top 100. ENJ rose 19.68% to change hands at $0.47. The token started its rally on Tuesday, ahead of the release of the upcoming Enjin platform, which the company teased Social Media.
Next week: Will Bitcoin claim $30,000?
Stadelmann said Bitcoin could break through the US$30,000 mark in the coming week, but warned that a recession could be on the way.
When this sinks in, some panic selling will start in Bitcoin, but like during the Covid-19 panic, Bitcoin will recover quite quickly, he said. “The bank runs we’ve seen over the last few months build the case for Bitcoin. They’re the reason Bitcoin was built.”
Marat Minkin, co-founder of decentralized financial payment app TONBanking, said regulatory developments and economic data will continue to dictate the crypto market trend next week.
The US is scheduled to publish key inflation figures next week. According to Minkin, Bitcoin is a safe haven to hedge against inflation and recession.
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