Friday, 7 April 2023

Market Summary

Market Summary 7 April 2023

Bitcoin Price: US$ 28,033.82 (-0.42%)
Ethereum Price: US$ 1,872.41 (-1.90%)  


Avalanche’s AVAX token has rallied 2% following the live launch of the Cortina upgrade on the protocol’s testnet, which will make it easier for exchanges to support Avalanche’s X-Chain and enable faster development. Additionally, Avalanche has released “Evergreen Subnets,” a series of tools designed for financial institutions. In other news, Tether (USDT), the world’s largest dollar-pegged stablecoin, is thriving, with its market capitalisation increasing by over 20% to $80 billion this year, driven by aggressive minting and issuance on the Tron Network. Tether’s market cap is now just $3 billion short of the record high of $83 billion reached in May of last year.

Bitcoin’s recent price rally, which some have attributed to a safe-haven narrative as U.S. banks collapsed, may have actually been driven by improved risk appetite, according to analysts. The cryptocurrency’s rise in March coincided with the Nasdaq to S&P 500 ratio, suggesting that the rally may have been mainly driven by hopes for a liquidity-boosting rate cut by the Federal Reserve. The 90-day correlation coefficient between bitcoin and the NDX/SPX ratio rose to 0.90, signaling the strongest positive relationship between the two assets since June 2022. In other news, M11 Credit has reopened lending and is raising capital for its new crypto lending pool on Maple Finance after experiencing $36 million of defaults and missed payments following the collapse of FTX in November. The company has appointed a new head of credit and upgraded its risk management and credit underwriting processes.

Tokenised gold assets have surpassed $1 billion in market capitalisation as gold’s price approaches its all-time high, according to data from crypto price tracker CoinGecko. Tokenised gold is a type of stablecoin that is pegged to the price of gold, and the tokens on the blockchain represent ownership of physical gold managed by the issuer. The two largest gold stablecoins are pax gold (PAXG), issued by New York-based fintech firm Paxos Trust Company, and tether gold (XAUT), issued by Tether. In other news, blockchain-based tokenisation of real-world assets (RWA) is gaining traction among major financial service firms and other big brands, as it offers the convenience of buying and selling assets around the clock without involving traditional brokers.

Bitcoin’s recent 70% gain in Q1 is not convincing everyone that it will continue to climb or even maintain current levels near $30,000. Bloomberg Intelligence noted the close relationship between crypto performance and global central bank liquidity levels, with banks withdrawing liquidity from the economy as inflation bites. The United States Federal Reserve’s quantitative tightening coincided with the current all-time high for Bitcoin, while plunging M2 money supply and bank deposits mean that liquidity continues to be squeezed. Meanwhile, the top two decentralised derivatives platforms, dYdX and GMX, are head-to-head around liquidity and trading volumes. While dYdX incentivises trading volumes with tokens, GMX’s model pitches liquidity providers against traders and has fared well in facilitating zero-slippage trading.

Software company MicroStrategy announced that it has bought another 1,045 Bitcoins worth $29.3 million, bringing its total investment in the cryptocurrency to $4.1 billion. The move comes as Bitcoin’s price nears the company’s break-even point. MicroStrategy’s 140,000 BTC was purchased at an average price of $29,803 per coin, meaning that if the asset’s value increases by 6%, or $1,780.91, the company will turn a profit. In other news, tensions between Paxful co-founders Ray Youssef and Artur Schaback have escalated, resulting in the suspension of the peer-to-peer Bitcoin exchange’s operations. Paxful’s future is now in question as Youssef has recommended a new provider to users, while Schaback hopes to resume operations.

Australia’s financial regulator, the Australian Securities & Investments Commission (ASIC), has canceled the operating license for Binance’s derivatives business, Binance Australia Derivatives. This comes a day after the crypto exchange requested the move, and it allows Binance to pursue a more focused approach in Australia by winding down the business. The cancellation will not affect Binance’s continued commitment to the development of the local blockchain and digital assets industry, according to a Binance spokesperson. Meanwhile, Aragon has announced the launch of its new tech stack on the Polygon network, which requires no coding skills, allowing users to easily design important decentralised autonomous organisation (DAO) functionality, such as creating proposals and casting governance votes.




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