I suspect there are interesting dynamics affecting the crypto markets in relation to the macro markets, namely the rotation of capital from crypto gains to tech stocks that had previously been sold massively and, more recently, the pick-up in inflation.
On the session, crypto decidedly bounced back from the day before yesterday. BTC was the leader and outperformer, rising more than 11% and taking us from $31,000 back above $37,000.
The BTC Dominance index rose, showing that alts didn’t match the advance. They’re still up, though. ETH gained almost 4%. It’s worth noting that ETH wasn’t sold off as much as BTC was, and so the asset probably had less impetus for a massive move up. ZEC rose almost 10% along with other privacy coins, perhaps due to the Chinese crackdown or the global pick-up in regulation. DOT and LINK both advanced around 5%.
As for news, El Salvador officially made BTC legal tender. This is a truly historic and momentous event for both the country and the crypto space. It means Salvadorian people will be able to accept BTC for commercial transactions and will have the right to hold, account, and pay taxes in BTC. It’s worth noting that they have the choice to stick to USD if they so choose. I think this type of adoption can happen slowly and then all at once, and we might see more countries making similar moves in the future.
While they might not be countries, it was great to also hear from two large financial firms looking to enter the space, I’m talking about Interactive Brokers which should offer crypto trading sometime this summer and also Victory Capital (a massive asset management firm with $160 billion in AUM) announcing that they plan to allocate to crypto.
That being said, China is still cracking down on crypto, by blocking search engines from showing crypto exchange websites and also arresting a large number of people on crypto related money laundering charges.
To finish with some interesting data, Glassnode’s binary CDD, which looks at the on-chain movement of old coins relative to previous periods, seems to show we are back into ‘pre-bull’ accumulation, suggesting we might be forming a base for longer term holders.
Written by: Justin d'Anethan, Sales Manager
With investors looking at the next Fed monetary policy meeting, equity indexes rose yesterday. The S&P reached new records while the Nasdaq closed within 20bps of the all-time high.
Welcome to the Weekender: Your weekly round up of the most viewed stories of the week, as voted by you, our readers. This week has seen the negative news flow replaced with tales of adoption, it appears the central bankers, country leaders, and the financial institutions have all agreed: Digital finance is here to stay.
Yesterday, the US reported CPI data—an index calculating the price increase or decrease of a basket of goods. The number is higher than expected and indicates inflation is picking up.