On Tuesday morning during the Asian trading session, Bitcoin experienced a decline and dropped to the level of US$28,000. Subsequently, it further plummeted below that support line later in the morning. With Polkadot and Solana leading the losers, Ether and the top 10 non-stablecoin cryptocurrencies traded lower. After the month began with yet another bank failure in the United States, the three main U.S. stock futures indices decreased. Cryptocurrency trade volume increased over night, while stock trading was light ahead of the Fed’s interest rate decision on Wednesday and additional data on the status of the US economy expected later this week.
According to data from CoinMarketCap, Bitcoin decreased 4.1% to US$28,058 in the 24 hours leading up to 8:00 a.m. in Hong Kong. The decline left the biggest cryptocurrency in the world with a far more modest seven-day increase of 1.97%. Despite recent projections of significant price increases for Bitcoin this year, most investors are wary of crypto and other assets due to uncertainty about the U.S. banking sector and whether more collapses would occur.
Ether decreased by 0.6% for the week, falling 2.16% to US$1,830. The price of the token has now returned to levels from the beginning of April, giving up the majority of the gains associated with the Shanghai hard fork on April 12 that allowed billions of dollars’ worth of ether to be removed from staking pools.
Solana dropped 3.45% to US$21.97, which might be profit-taking following the recent excitement over the launch of the first smartphone powered by blockchain, called “Saga,” slated for May 4. For the week, the token is still up 2.7%. With a loss of 3.73% to $5.67 and a 7.day loss of 3.81%, Polkadot was the biggest loser.
While trading volume increased 28.9% to US$40.97 billion in the last day, the total market capitalization of cryptocurrencies decreased 3.21% to US$1.16 trillion.
NFT
The indices serve as proxies for performance indicators for the worldwide NFT market. They are run by CryptoSlam, a subsidiary of Forkast.News that falls under the Forkast.Labs brand.
The Forkast 500 NFT index, which measures the non-fungible token (NFT) market, fell 0.86% to 3,717.16 in the 24 hours leading up to 8:00 a.m. in Hong Kong, losing 1.16% for the week.
Despite the index’s decline, the overall NFT market’s developments are accelerating. Leading art auction firm Sotheby’s is now enabling peer-to-peer trades of NFT artwork between collectors on its platform using the Ethereum and Polygon networks. Sotheby’s has allegedly handled about US$120 million in NFT sales.
By trading volume, Blur is now the largest NFT marketplace. On Monday, Blur announced the debut of “Blend,” a peer-to-peer NFT lending protocol that will enable users to pledge collateral when buying NFTs. According to its creators, the service would operate on the same tenet as a mortgage to purchase a home and will boost market revenue and user numbers.
Equities
U.S. stock futures were down as of 8:00 a.m. in Hong Kong, indicating the market’s direction when Wall Street opens later on Tuesday. The S&P 500 futures index fell 0.14%, and the Dow Jones Industrial Average futures dropped 0.11%. Nasdaq-100 futures decreased by 0.15 percent.
The fall of First Republic Bank over the weekend, the fourth bank failure in the United States this year after Silvergate, Silicon Valley, and Signature banks, caused all three indexes to close lower on Monday during regular trading.
U.S. regulators took over First Republic after it revealed in April that more than 40% of deposits, or about $100 billion, had been removed. The stock then fell sharply. JPMorgan said in a press release on Monday that it had won the auction to buy the bank’s remaining assets.
According to Reuters, Morgan Stanley announced Monday that it will eliminate another 3,000 positions in the second quarter, while Treasury Secretary Janet Yellen warned that the United States government may experience a debt default by June 1 if Congress doesn’t lift the debt ceiling.
The world’s largest firm by market value, Apple, will report its results on Thursday, and on Friday, the Bureau of Labor Statistics will release its April employment statistics as additional signs of the state of the American economy and businesses.
Prior to those, though, attention is on the Federal Reserve’s upcoming interest rate decision, which is scheduled for May 3. Over the past year, the Fed has raised rates numerous times in an effort to reduce inflation to its 2% target range.
The CME Group’s experts now predict an 85.5% chance that the Fed will increase rates by 25 basis points this week, and this is substantially priced into markets given that U.S. inflation is currently running at around 5%. The largest economy in the world is currently experiencing interest rates between 4.75% and 5%, which are the highest since June 2006.
