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| Everything you need to make sense of the crypto markets and beyond By the CoinDesk Markets Team Edited by Lawrence Lewitinn, Managing Editor, Global Capital Markets May 7, 2021 Sponsored by Bitcoin (BTC) -2.4% $56,587 Ether (ETH) -0.7% $3,461 (Price data as of May 7 @11:00 UTC) If you were forwarded this newsletter and would like to receive it, sign up here.
Good morning. Here's what we're writing about: Market Moves: Gold Rallies as Bitcoin Languishes Around $56KTechnician's Take: Bitcoin Holds Support; Faces Resistance Around $58K-$60K
Check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Lawrence Lewitinn and Emily Parker, at 9 a.m. U.S. Eastern time. Today the show will feature guests: Hunter Merghart, Bitstamp Head of U.S. Greg Magadini, Genesis Volatility Co-Founder & CEO Scott Conger, Jackson, TN, Mayor
Biggest Movers These are the biggest movers in the CoinDesk 20 over the past 24 hours:
Gainers: EOS (EOS): +26.7% Tezos (XTZ): +13.0% Algorand (ALGO): +8.7%
Losers: XRP (XRP): -5.4% Yearn Finance (YFI): -4.3% Uniswap (UNI): -4.1%
The CoinDesk 20 are 20 digital assets filtered from the larger universe of thousands of cryptocurrencies and constitute roughly 99% of the market by volume at eight of the largest and most trustworthy exchanges.
Market Moves by Omkar Godbole Gold Rallies as Bitcoin Languishes Around $56K Bitcoin (BTC) was trading sideways on Friday, even as gold rallied to three-month highs amid a renewed drop in U.S. real (inflation-adjusted) bond yields.
The cryptocurrency was changing hands for $56,500 at 11:00 UTC, continuing a week-long consolidation in the range of $52,000 to $59,000, according to CoinDesk 20 data.
Gold, a traditional store-of-value asset, rose to $1,820 per ounce, the highest level since Feb. 16. The move came a day after the U.S. 10-year real yield fell to a three-month low of -0.88%, per data from the U.S. Department of Treasury.
“Lower real rates boost gold which now trades below fair value,” ByteTree CIO Charlie Morris tweeted Thursday.
The collapse in real yields was in large part responsible for risk-taking across financial markets last year, as noted by MarketWatch. In addition, some institutions poured money into bitcoin amid fears over inflation. As such, some crypto market participants became more cautious in late February and early March 2021, after a brief spike in real yields to -0.57%.
However, the latest bout of weakness in the inflation-adjusted 10-year yield is struggling so far to push bitcoin higher.
Since mid-March, the yield has dropped by 30 basis points, marking a steady increase in inflation-adjusted loss for bond investors. Bitcoin registered a moderate decline of 1% during that time-frame, while gold has responded positively, rising from $1,700 to over $1,800.
According to Bank of America, inflows into gold funds amounted to $1.6 billion in the week ended May 5, the largest in three months.
In the crypto markets, investor focus has shifted from bitcoin to ether (ETH) and Ethereum-related projects like decentralized finance and layer-2 scaling. That could be the reason for bitcoin’s lackluster performance of late. Ether, the second-largest cryptocurrency by market value, has chalked up more than 60% gains in just the past 12 days.
That said, a continued rally in gold may revive spirits in the bitcoin market, as the precious metal led the cryptocurrency higher last year. Bitcoin and gold daily charts (Source: TradingView) Gold picked up a strong bid last June and surged to new record highs above $2,000 in August. Bitcoin followed suit in the final quarter, charting a near 90-degree rise to new record highs above $20,000.
History may well repeat itself this time, as bitcoin funds are again becoming popular. A report earlier this week from digital-asset manager CoinShares showed bitcoin funds and investment products drew $442 million last week, having leaked a record $21 million in the preceding week.
While the declining negative real yield is currently painting a bullish picture for bitcoin and gold, some analysts are of the opinion that good times may not last long.
“The bad news is global tapering has begun,” analysts at Bank of America said, adding that the process could pick up the pace in the third quarter, according to ForexLive. Tapering refers to the gradual reversal of inflation-boosting stimulus policies implemented by central banks.
Should that happen, real yields may rise sharply, diluting the appeal of inflation hedges like bitcoin and gold. Read the original story here: Gold Rallies as Bitcoin Languishes Around $56K
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Technician's Take by Damanick Dantes Bitcoin Holds Support; Faces Resistance Around $58K-$60K Bitcoin (BTC) held support around $54,000 after buyers took profit around the $58,000 resistance level on Thursday. The cryptocurrency was trading around $56,500 at the time of writing.
While the short-term trend is improving, traders have been quick to take profit on rallies. Slowing momentum is typical of a consolidation phase, which suggests traders are taking a breather following a near two-fold price increase in BTC over the past year. Four-hour bitcoin chart shows support and resistance levels with RSI (Source: TradingView) Bitcoin remains above the 100-period moving average on the four-hour chart and daily chart. This indicates an improving short-term trend, albeit with resistance around $58,000.BTC has retraced about 50% of the April 14 sell-off from an all-time high around $64,900. The relative strength index (RSI) is neutral across short-term charts and has receded from extreme overbought levels on the long-term weekly chart. Initial support is seen around $54,000 and then $52,000 which has limited profit taking over the past week. Original story found here: Bitcoin Holds Support; Faces Resistance Around $58K-$60K
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BOLO Be on the look out for these upcoming events: 12:30 UTC (8:30 a.m. ET): Nonfarm payrolls (April). Forecast: 1.0 million 14:05 UTC (10:05 a.m. ET):Ethereal Summit talk: Vitalik Buterin and Aya Miyaguchi of the Ethereum Foundation; moderated by Camila Russo of The Defiant.
A message from CoinDesk Unlocked 101 at Consensus by CoinDesk 2021
The countdown is on to Consensus by CoinDesk, our virtual big-tent event this May.
For those who need a primer or to brush up on the fundamentals, we're hosting Unlocked 101, a free educational series designed to give you the tools you need to navigate crypto.
Sessions run May 4–20, covering the basics of Bitcoin, DeFi, scams and hacks and the NFT boom.
ICYMI In case you missed it, here's the most recent episode of "First Mover" on CoinDesk TV: Ethereum Co-Founder on the Rise of Ether and DeFi; Gary Gensler to Testify Before Congress Best known as a co-founder of Ethereum, Anthony Di Iorio joins "First Mover" to share his views on Ether's surge and the rise of decentralized finance (DeFi). This, as the crypto community, awaits Gary Gensler's testimony before Congress, his first as the new chairman of the Securities and Exchange Commission (SEC). CoinDesk's Nik De reports what Gensler may say. Plus, Philip Gradwell, Chief Economist at Chainalysis, joins our markets discussion, and Sean Sanders of Revix shares an update on the state of crypto in Africa.
Introducing CoinDesk Indexes TradeBlock, the leader in providing crypto asset indexes to financial institutions, will now assume the CoinDesk name. Introducing CoinDesk Indexes: the industry standard for institutional-grade digital currency price references with billions of dollars in monthly trading volume quoted against them. Underlying new brand names, TradeBlock's index methodology will continue to adhere to the standards of integrity and reliability that have always differentiated its indexes. Read more about CoinDesk Indexes, the industry standard in crypto benchmarks.
Latest Headlines Crypto Now Viewed by Some as a Threat to Financial Stability, Fed Survey Finds The Fed's own staffers didn't mention cryptocurrencies as a risk to financial stability, but market participants did. The Internet Computer, which the Dfinity Foundation plans to launch Friday, has the potential to make every facet of decentralized finance (DeFi) applications uncensorable – that is, if the project’s unusually bold claims hold up. Scaramucci’s SkyBridge Taps NYDIG as Bitcoin ETF Custodian, Documents Show New SEC filings reveal that NYDIG has been picked for SkyBridge's pending bitcoin ETF application. Sotheby’s to Auction ‘First NFT Ever Minted’ The auction will feature an NFT by Kevin McCoy minted in May 2014. Iran’s Central Bank Reportedly Bans Trading of Crypto Mined Abroad The move is said to be an attempt to stop capital flight from Iran. Crypto Card Provider Simplex Being Acquired by Canadian Firm for $250M Visa network member Simplex provides users with crypto on-ramp/off-ramp capabilities using debit and credit cards. Citi Considering Crypto Services Amid Surge in Interest: Report Trading, custody and financing are all said to be under consideration by the U.S. banking giant. NYDIG Names Bridgewater Associates CFO as New Financial Chief Prior to joining Bridgewater, Dalby was CFO and Chief Operating Officer of D.E. Shaw Renewables Investments.
CoinDesk Research: Does Bitcoin Have an Energy Problem? Is Bitcoin bad for the environment? This CoinDesk Research report looks at the data behind the most common critiques and shows that, while Bitcoin uses a lot of energy, the mix is evolving toward renewables. Bitcoin also incentivizes investment in clean energy sources, can convert pollution into value, and redistributes wasted power production.
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. ATTENTION: Scammers have been sending fraudulent emails with links to sites disguised to look like coindesk.com. If you are in doubt about a link, type https://www.coindesk.com directly into your browser; do not copy and paste. Remember, if something seems too good to be true, it probably is.
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