Illustration by Mitchell Preffer for Decrypt.
Bitcoin (BTC) and Ethereum (ETH) started the weekend with modest losses over the past seven days, despite a small spurt of growth midweek on news that US Labor Department inflation readings were lower than expected.
Bitcoin is down 7.9% and is trading at $26,817. Even the news that the Principality of Liechtenstein will soon accept it as a means of payment for government services couldn’t prevent the largest cryptocurrency by market cap from posting a bigger loss than Ethereum this week.
Bitcoin had to compete with a rising dollar this week. The cryptocurrency is typically inversely related to the dollar, so the rise in the dollar over the past two days has translated into a fall in the value of bitcoin.
According to blockchain analyst Domo’s Dune dashboard, the use of bitcoin for ordinals NFTs also appears to be slowing, with trading volume down 50% on May 11 and remaining well below its range for most of May.
Bitcoin transaction fees also hit a brief two-year high on Tuesday, according to data from BitInfoCharts, when the median price touched $31.14. This value is now below 10 US dollars again.
Ethereum is down 5.8% in the seven days and is currently changing hands at $1,800. It’s one of the lighter drops in a week when the damage was broadly light across the market.
Cryptocurrencies down more than 8% this week include Polygon (MATIC), which fell 11.5% to $0.856058, Avalanche (AVAX) fell 11% to $15.01 , Toncoin (TON) is down 11.8% to $1.85 and Internet Computer (ICP) is down 9.2% to trade at $5.16.
In the news…
American crypto exchange Bittrex filed for Chapter 11 bankruptcy on Monday. The news comes weeks after the Securities and Exchange Commission (SEC) accused the company of failing as a broker-dealer, exchange and clearing agency, saying the agency made illicit earnings of between 2017 and 2022 at least $1.3 billion.
As early as March, Bittrex announced that the US business would be discontinued. CEO Richie Lai cited the “current regulatory and economic environment in the USA” as reasons for the decision.
At a hearing Wednesday in Washington, Republican and Democratic lawmakers failed to find common ground on the need for new regulation for digital assets. Their main difficulty is deciding whether to consider a token as a security or a commodity. In the former case, the regulatory authority would be given to the SEC, in the latter case to the Commodity Futures Trading Commission (CFTC).
On the same day, Texas lawmakers overwhelmingly voted to update the state’s Bill of Rights to include the people’s right to own, possess, and use digital currencies. However, there is still a long way to go before it is passed, and it still needs to pass one more vote in the House of Representatives, one in the Senate and one referendum.
Finally, on Thursday, the US Chamber of Commerce criticized the SEC for its regulate-by-enforcement approach to the digital asset industry. As part of the exchange’s ongoing court filing, it filed an amicus brief in support of Coinbase to get the securities regulator to clarify its rules.
“The SEC has deliberately unsettled the situation by claiming sweeping authority over digital assets while pursuing an arbitrary, enforcement-based approach,” the chamber wrote. “This regulatory chaos is intentional, not an accident.”