Bitcoin fell 0.5% to $27,416 in the past 24 hours after facing selling pressure last week as bond yields rose and the U.S. dollar liquidity declined. The cryptocurrency registered a 9% weekly loss, its largest seven-day decline since early November, according to data from TradingView and CoinDesk. Bitcoin had reached $30,000 last week for the first time in almost a year. The yield on the 10-year U.S. Treasury note rose by six basis points to 3.58%, its second straight weekly gain, denting the appeal of risky assets, including cryptocurrencies. Ether also erased most of its monthly gains, trading recently at $1,851, down 1% in the past 24 hours. Simon Peters, an analyst at investment firm eToro, wrote in a morning note Monday that the market is yet to see bitcoin retest more precipitous levels that would suggest the recent rally is finished.
Bitcoin’s seven-day price chart
Existing crypto companies could get a “fast-track regime” to new European crypto rules, France’s Financial Markets Authority said in a Friday statement. France recently toughened its crypto registration procedures in the wake of crypto exchange FTX’s collapse and in preparation for the European Union’s Markets in Crypto Assets law. The European Parliament voted in favor of MiCA last week, and the rules are set to take effect starting around July 2023. There will now be “consideration of a possible fast-track modular licensing” between France’s existing regime, known as PSAN, and MiCA, which includes much tougher governance, consumer-protection and financial-stability rules, the AMF said.
U.S.-based crypto exchange Gemini revealed Friday plans to open an offshore derivatives platform – a decision announced as the regulatory environment gets tougher in its home country. The first product at Gemini Foundation, as the new division is called, will be a perpetual bitcoin contract denominated in Gemini dollars (GUSD), the company said, followed by a perpetual ether contract also linked to GUSD. Unlike conventional derivatives, perpetuals don’t have an expiration date. The decision coincides with U.S. regulators getting stricter about cryptocurrencies. In January, the company and Genesis (which, like CoinDesk, is owned by Digital Currency Group) were accused by the Securities and Exchange Commission of selling unregistered securities.
Market Insight: Bitcoin, Ether March Apart
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The correlation between bitcoin and ether returns has been declining since mid-March, when bitcoin started outperforming against the backdrop of the U.S. banking turmoil and increased regulatory scrutiny of non-bitcoin digital assets, crypto exchange Coinbase said in a research report Friday.
The decline in the relationship has become more pronounced following the Ethereum blockchain’s Shanghai upgrade – aka Shapella, the report said, noting that a similar trend was seen in September 2022 following the network’s previous update, the Merge.
The Shanghai upgrade was successfully completed on April 12 and enables validators to withdraw staked ether.
The chart shows a 1% bid depth for Coinbase’s wrapped Ethereum staking token, cbETH, from March 26. The 1% bid depth refers to the number of outstanding purchase orders within 1% of the mid-price.
The bid depth rose after Ethereum implemented its highly anticipated Shanghai upgrade on March 12, allowing users to withdraw the ether staked in the network at will.
According to Kaiko, the uptick in the bid depth suggests traders are more willing “to pick up the token should it dip relative to ETH.”
– Omkar Godbole
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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.
