What crypto worries? Investors send Bitcoin back above $28,000
Despite ongoing tensions over Binance’s recent legal troubles, Bitcoin and other major cryptocurrencies spent Wednesday in the green.
The largest cryptocurrency by market cap recently traded at $28,380, up 3.9% over the past 24 hours and well above its lows below $27,000 earlier in the week after the Commodity Futures Trading Commission (CFTC) filed a lawsuit against Binance in which she accused the stock exchange giant of offering unregistered crypto derivatives, among other allegations. BTC is up about 21% in March, outperforming other assets like ether, stocks and gold.
“The market has responded positively despite the CFTC story, largely as the broader narrative of a return to quantitative tightening (QE) and fiat pressure remains dominant,” said Joe DiPasquale, CEO of crypto asset manager BitBull Capital. in an email to CoinDesk.
Ether (ETH), the second largest cryptocurrency by market value, recently changed hands at $1,794, up 1.1% on the day. Among other altcoins, crypto payments platform Ripple’s XRP token continued its strength as of Tuesday, surging almost 6% to 54 cents. Cardano’s ADA token and Polygon’s MATIC token are up 3.8% and 3.3%, respectively.
DiPasquale said that the recent outperformance of coins like XRP is related to “regulators seeming to question even the biggest names in the industry,” adding that “the playing field is level for all other coins that were previously considered controversial.” “.
In the lawsuit filed against Binance in the US District Court in Illinois on Monday, the CFTC named several cryptos, including BTC, ETH, Litecoin (LTC), Tether (USDT), and Binance USD (BUSD). US Securities and Exchange Commission (SEC) Chairman Gary Gensler has previously hinted that proof-of-stake tokens like ETH are securities amid an ongoing feud between agencies over jurisdiction.
Stock markets edged higher on Wednesday, with the S&P 500 and the tech-heavy Nasdaq closing up 1.4% and 1.7%, respectively. The Dow Jones Industrial Average (DJIA) was also up 1%.
James Lavish, managing partner at the Bitcoin Opportunity Fund, called Wednesday a “risk day” across the board as investors appeared to be positioning themselves and their books ahead of several data releases later this week, including the final US GDP figure for the fourth quarter Thursday release and personal consumption expenditure (PCE) inflation data from Friday.
“The thought is if this data comes out weaker than expected, then it will provide (Federal Reserve Chair) Powell with enough evidence to stall further rate hikes,” Lavish told CoinDesk in an email. The CME FedWatch tool showed that currently over 62% of traders expect the Federal Reserve will not hike interest rates at its May monetary policy meeting.
He added that BTC’s price has benefited from the recent risk movement as well as the announcement that China has completed its first yuan-settled liquefied natural gas (LNG) trade with the United Arab Emirates.
“This strengthens the argument that Bitcoin could be used as a medium of exchange in large cross-border energy deals in the near future,” he said. “Nevertheless, I believe that reality, while valid, is still a long way off.”
Meanwhile, the US 2-year Treasury rate remained almost unchanged from Tuesday at the same time, standing at around 4.06% on Wednesday, while the 10-year Treasury rate was also almost unchanged from the previous day at 3.56%.
Nicholas Colas, co-founder of market analysis firm DataTrek Research, stressed in a note Wednesday that the yield on 2-year Treasuries has been higher than that on 10-year Treasuries since July 2022 – a sign that “markets have seen US monetary policy as restrictive.”
“Monetary policy is essentially pushing the brakes on the US economy and a recession inevitably ensues,” based on historical patterns, Colas wrote, adding, “We certainly have the ‘ignition’ for a call for a recession, but the catalytic ‘ Funke’ is still there for the US stock markets not very obvious.
A DAO gathers to keep the Goerli test network alive
The future of the Ethereum Goerli testnet remains uncertain, but a little-known Ethereum community is rallying behind the network in hopes that a solution can be found to keep it running.
GoerliDAO, a decentralized autonomous organization, advocates continuing Goerli as an active blockchain network and using Goerli Ether (gETH) to incentivize activity on the network.
“Goerli’s historical usage makes it an ideal candidate for Ethereum’s de facto canary network — a pre-test environment very similar to mainnet,” the newly formed DAO said in a post earlier this week.
“An incentive-based canary network like Goerli offers unique advantages for developers and users alike, and the concept has been successful on many blockchains — particularly with Kusama in relation to Polkadot,” it added.
Who is behind GoerliDAO has been unclear since Wednesday.
Testnets like Goerli are a testing environment that mimics real-world blockchain usage and allows developers to find and patch critical bugs for upcoming products or features to be deployed on a blockchain’s main or live network.
Much of the testing of Ethereum’s major upgrades, such as B. Merge, was performed on Goerli.
Keeping such a testbed alive is what the people behind GoerliDAO are committed to: “Keeping Goerli as a canary network will not only fill a critical need within the Ethereum ecosystem, but also pave the way for future innovation and incentivization in the world of pave decentralized finance,” they said.
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