Here’s what’s going on:
Why Bitcoin Started the Week Slowly Prices: Bitcoin remains above $41,000, despite aggressive statements from the US Federal Reserve’s chair.
Insights: Bitcoin has had a poor start to the week in Asia, and some investors may be betting on DeFi.
Technician’s take: Bitcoin’s pullbacks could be limited over the short term.
Ether Gains As Bitcoin Holds
After a brief slide below $41,000 following hawkish monetary policy statements from US central bank Chair Jerome Powell, Bitcoin (BTC) was roughly where it was 24 hours earlier, a little over $41,000.
Ether (ETH), the second-largest cryptocurrency by market capitalization after bitcoin, was trading at around $2,900, up over 2%. Other big cryptos had a mixed bag of results.
As investors assess fast-changing global macroeconomic dynamics, trading activity was weak. Last week, Bitcoin reached a high of nearly $42,000, boosted by China’s pledge to bolster its faltering real estate and technology sectors.
Powell said in a speech at the National Association for Business Economics annual conference in Washington, D.C.
That the Federal Reserve might raise interest rates in 50-basis-point increments to tame inflation, which has been plaguing the US economy and threatens to worsen amid fallout from Russia’s intensifying attacks on Ukraine.
Russian military attacked a mall in Kyiv, Ukraine’s capital, on Monday, continuing their campaign of targeting civilian targets, and US President Joe Biden warned that Russia could start cyberattacks on key US companies in revenge for harsh economic sanctions.
Brent crude oil, a widely followed indicator of the energy industry, increased 7% to $112 per barrel. Russia is one of the world’s top oil producers.
The low trading volumes were “quite common in a sideways trending market,” Katie Stockton, founder and managing partner of Fairlead Strategies, told CoinDesk TV’s “First Mover” show.
“Think of it as a tug-of-war between buyers and sellers, as well as a moment of indecision,” she explained. “I believe indecisiveness is reflected in the lighter volumes and less definitive current actions,” says the author.
Then it’s just a matter of determining whether the consolidation period reconciles to the upside or downside.”
All in all, According to data from CoinDesk Indices, bitcoin started the trading week slowly in Asia, spending most of the day hanging around $41,000.
That, however, is Bitcoin’s issue. However, Layer 1 protocols such as Avalanche gained 32 percent last week, while liquidity protocol Aave gained 34 percent, and Ethereum gained 15 percent.
And where is all this bitcoin going? Likely into decentralized finance (DeFi). The Bored Ape Yacht Club-linked ApeCoin (APE) seemed to be the most exciting new thing on the blockchain, jumping over 10% during the day.
As CoinDesk reported, APE-covered calls were hitting a 42% projected annualized yield.