State of the Crypto Markets

Macro Overview

• US SEC Chair Gensler Speaks: Gensler discussed ongoing reviews and multiple filings of BTC spot ETFS, leaving room for speculation on their decisions.
• US Consumer Price Index (CPI): The CPI for the year came at  3.7%, slightly more than the expected 3.6%. This could have a slightly negative impact on the crypto market, as it exceeded expectations.
• US Producer Price Index (PPI) – The PPI for the month came at 0.7%, surpassing the forecasted 0.4%. This could have a bearish effect on the crypto market, as it exceeded expectations.
• Weekly US Unemployment Claims:  Weekly claims dropped to 220K, slightly worse than the forecasted 226K. This is not good news for crypto, as it’s below expectations and could have a bearish effect.

Crypto Markets Overview

• Market Movement: This week, the crypto markets experienced a slight 0.58% increase, bringing the total market capitalization to $1.037 trillion. Notably, BTC saw a rise of 1.98% and ETH saw a marginal fall of -0.36% . Bitcoin’s dominance stands at 49.82%, while Ethereum’s holds at 18.95%.
• FTX’s Digital Asset Sale: A significant development in the crypto space involves the court-approved sale of FTX’s digital assets, valued at up to $3.4 billion. However, this sale excludes Bitcoin and specific insider-affiliated tokens. The assets will be sold in weekly batches following predefined guidelines, starting with a limit of $50 million for the first week, with potential increases.
• Franklin Templeton’s Bitcoin ETF Application:The competition for a Bitcoin spot ETF in the United States intensifies as asset manager Franklin Templeton joins the race. They recently filed an application with the Securities and Exchange Commission (SEC). This move positions them alongside industry giants like BlackRock and Fidelity, all vying for a significant role in the ETF market.
• Deutsche Bank’s Crypto Custody and Tokenization: Deutsche Bank is entering the world of cryptocurrency custody and tokenization through a partnership with Taurus. In this collaboration, the bank will utilize Taurus’ technology to effectively manage cryptocurrencies, tokenized assets, and various digital assets.
• Consensys’ ‘Snaps’ Add-Ons for MetaMask: Consensys introduces ‘Snaps,’ a set of new features and functionalities developed by third-party developers for MetaMask users worldwide. These ‘Snaps’ can be directly installed into the MetaMask wallet, enhancing its capabilities and user experience.
• PayPal Enables Crypto Sales and Conversion to USDT via MetaMask: PayPal continues its expansion in the digital asset space, allowing users in the United States to sell cryptocurrencies like Bitcoin and convert them into USDT (Tether) through the MetaMask wallet. This functionality provides users with the option to easily convert their crypto holdings into a stablecoin, enhancing flexibility and usability.
• Bitcoin’s Clean Energy Usage and Elon Musk’s Awaited Decision Reports indicate that Bitcoin’s utilization of clean energy sources has surpassed the 50% mark. This achievement aligns with Elon Musk’s earlier statement in 2021, where he mentioned that Tesla would accept Bitcoin payments once miners reached this clean energy threshold. It will be interesting to see whether Elon Musk makes up his mind and follows through on his thought of acquiring Bitcoin for Tesla’s payments.

Top Tokens Update

• Thorchain’s Integration with Metamask: Thorchain, a decentralized finance (DeFi) project, achieved a significant milestone by integrating with Metamask. This integration brings Thorchain closer to realizing its full potential within the DeFi ecosystem, resulting in a remarkable 30% price rally in just one week.
• XLM’s Disappointing Announcement: XLM (Stellar) generated excitement when it hinted at a significant reveal through a tweet. However, the actual announcement left many disappointed, as it turned out to be the launch of a new website. This underwhelming development led to a decrease in XLM’s price.
• SOL’s Resilience and Price Surge: Despite rumors of selling pressure after FTX’s digital asset sale approval, SOL (Solana) remained resilient. Much of its holdings are locked until 2025, calming investor concerns. Notably, SOL’s price even surged after the news, reflecting continued positive sentiment.

“Big Picture: Upcoming Weeks’ Key Economic Events”

Note: “Events in red font signify severe impact, while those in yellow indicate moderate.”

Bitcoin Technical Analysis

Summary: 

• Despite negative news about CPI, PPI, Weekly Claims, and FTX’s liquidation approval, BTC has held its ground.
• In the 1-day chart, BTC is showing a positive sign with an RSI bullish divergence, which is a good thing.
• Right now, BTC is facing resistance at 26,830, which was last week’s high. To keep going up, it needs to break past this level.
• Additionally, Resistance levels are at $27300 and $28000 (Approx values)
• On the downside, there’s support at around $25,000. Coinciding with levels – lows of the previous week and month.
• It’s important to mention that a BTC death cross recently happened, which is a bearish sign for the long term. But for now, in the short term, BTC doesn’t seem bearish.

Ethereum Technical Analysis

Summary: 

• This week, ETH hasn’t performed as well as BTC.
• ETH dropped to $1,550, which is the same level as the previous month’s low support.
• It rebounded from there and is now holding steady at $1,630.
• There are resistance levels above at $1,670, $1,736, and $1,796.
• On the downside, support can be found at $1,550 and a significant level at $1,481 (0.618 Fibonacci level).
• It’s worth noting that a similar bullish RSI divergence can be seen in the ETH chart too, which is a positive sign.

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