The latest moves in crypto markets, in context By Lyllah Ledesma, CoinDesk reporter Was this newsletter forwarded to you? Sign up here. |
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Welcome to Monday. Here’s what's happening in crypto today: |
- Bitcoin tops $28,000 as traders look outside of traditional banks.
- A New York community bank to insure Signature Bank's non-crypto deposits.
- Open Interest in bitcoin futures hits a yearly high of $12 billion.
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CoinDesk Market Index (CMI): 1,240 +2.4%
Bitcoin (BTC): $28,196 +3.9%
Ether (ETC): $1,782 +0.1%
S&P 500 futures: 3,949.75 −0.2%
FTSE 100: 7,354.88 +0.3%
Treasury Yield 10 Years: 3.4% −0.2 |
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Bitcoin climbed 4% in the past 24 hours to above $28,000 for the first time since last June as some traders see the cryptocurrency as a hedge against the traditional banking system, which has had its share of troubles over the past few weeks, including the collapse of Silicon Valley Bank and regulators' takeover of Signature Bank. On Sunday, the Federal Reserve announced it had joined with other major central banks to ensure a steady flow of the U.S. dollar, a dominant reserve currency, in the global financial system. Bitcoin was up 25% this month through Sunday. |
Bitcoin's 24-hour price chart |
Non-crypto-related deposits held by former Signature Bank (now Signature Bridge Bank) will be assumed by Flagstar Bank, a subsidiary of New York Community Bancorp, as of Monday under a purchase and assumption agreement, the Federal Deposit Insurance Corp. said in a press release on Sunday. Signature Bridge Bank depositors – other than depositors related to the digital banking business – will automatically become depositors of Flagstar, and will continue to be insured by the FDIC up to the insurance limit. Flagstar Bank's bid didn't include $4 billion of deposits related to the former Signature Bank's digital banking business. The dollar value locked in the number of open bitcoin futures contracts is rising, signifying increased speculative interest in the market and potential for price volatility. Data from Coinglass shows the nominal value of open interest has reached a yearly high of $12 billion, marking a 7% gain for the month. An increase in open interest means new money is flowing into the market but doesn't reveal much about whether traders are getting in position for price gains or losses. In bitcoin's case, the new money seems to be betting on price gains, considering the funding rate or the cost of holding bullish long/bearish short positions has flipped into the green after spending most of the early parts of the Asian trading day in the red. |
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Market Insight: BTC More Volatile Than ETH |
For the first time in nearly two years, crypto options traders are implying that the largest cryptocurrency, bitcoin, will be more volatile than ether, the second-largest and the native token of the Ethereum blockchain. That's unusual because ether and alternative cryptocurrencies generally tend to be more volatile than bitcoin. The latest trend is reflective of a market squarely focused on macroeconomic issues. The spread between dominant crypto options exchange Deribit's forward-looking 30-day implied volatility index for ether (ETH DVOL) and bitcoin (BTC DVOL) fell below zero over the weekend, a phenomenon not seen since May 2021, according to data source Amberdata. |
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- The chart shows bitcoin's rolling 30-day correlation with the U.S. Dollar Index, which tracks the greenback's exchange rate against major fiat currencies.
- The negative correlation has recently weakened amid U.S. bank failures that have complicated the Federal Reserve's fight against inflation.
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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. |
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