Market Wrap: Bitcoin Near $60K as Coinbase Listing Stirs Fresh Crypto Hype
The listing could spur newbie investors to try cryptocurrencies.
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- Bitcoin trading around $60,120.82 as of 20:00 UTC (4 p.m. ET). Climbing 0.68% over the previous 24 hours.
- Bitcoin’s 24-hour range: $59,428.21-$61,219.72 (CoinDesk 20)
- BTC trades between its 10-hour and 50-hour averages on the hourly chart, a sideways signal for market technicians.
Bitcoin surged early Monday to a four-week high of $61,219.72. Analysts said the largest cryptocurrency might have gotten a boost from the hoopla surrounding U.S. exchange giant Coinbase’s coming direct stock listing Wednesday.
In cryptocurrency circles, the “Coinbase effect” is when a digital token gets a price pump after getting listed on the cryptocurrency exchange. But bitcoin might get the benefit of a different type of “Coinbase effect” – if newbie investors, spurred by mainstream press coverage of the stock listing, decide to put money into cryptocurrencies.
“The Coinbase hype within crypto, in terms of valuation and its domino effect on other markets” means Wednesday’s direct listing might become “a key catalyst event,” Singapore-based crypto quant firm QCP Capital wrote Monday on its Telegram channel.
The cryptocurrency analysis and data site IntoTheBlock wrote in a newsletter last week that “anticipation” of the Coinbase stock listing “has contributed to broader risk-on sentiment throughout crypto.” A week ago, the market value of all cryptocurrencies surpassed $2 trillion for the first time.
QCP noted that bitcoin prices, despite doubling so far this year, have underperformed the Standard & Poor’s 500 Index of large U.S. stocks in the past month, so a successful Coinbase listing might lead to a reversal.
Cryptocurrency analysts also are studying a key blockchain data metric that’s seen as bullish: bitcoin’s liquid supply changes.
According to the analyst Willy Woo, more bitcoins are turning from liquid status to illiquid, meaning they’re getting withdrawn and locked away into long-term holding patterns.
That means there might be less supply to go around for new bitcoin buyers, potentially offsetting what appears to have been a recent slackening of demand.
On the other hand, CoinDesk reported that net inflows to digital asset investment products declined last week by $23 million to $83 million.
Bitcoin’s market dominance at the same time dropped to around 55.6%, the lowest level since April 2019 – potentially an indication that more investors have shifted their focus to alternative cryptocurrencies (altcoins).
Ether and altcoins
- Ether trading around $2,144.59 as of 20:00 UTC (4 p.m. ET). Climbing 0.04% over the previous 24 hours.
- Ether’s 24-hour range: $2,103.67-$2,199.87 (CoinDesk 20)
- Ether trades between its 10-hour and 50-hour averages on the hourly chart, a sideways signal for market technicians.
Ether hit a new all-time high price at $2,199.87 during trading hours in Asia Monday, but exchange tokens including Binance’s BNB and Uniswap’s UNI stole the thunder with staggering double-digit percentage gains.
BNB was up more than 15% in the past 24 hours, while UNI was up more than 20%, according to Messari.
The exchange tokens’ rally in the past month is a “spillover” from Coinbase’s listing, according to QCP, which warned that the fuss surrounding the event could lead to “too much short-term froth” in the crypto market.
Binance, the biggest crypto exchange in the world by trading volume, announced on Monday it is now offering a zero-commission tokenized stock trading service to its users, with prices settled in Binance’s own U.S. dollar-linked stablecoin, Binance USD (BUSD).
Other digital assets on the CoinDesk 20 are mixed. Notable winners as of 20:00 UTC (4:00 p.m. ET):
- cardano + 3.71%
- cosmos (ATOM) + 3.07%
- omg network (OMG) + 1.22%
Notable losers:
- stellar (XLM) - 5%
- ethereum classic (ETC) - 4.07%
- eos (EOS) - 3.59%
- kyber network (KNC) - 3.55%
Other markets
Equities:
- Asia’s Nikkei 225 closed in the red 0.77%.
- The FTSE 100 in Europe was down by 0.39%.
- The S&P 500 in the United States closed in red 0.02%.
Commodities:
- Crude oil (WTI): +0.66% to $59.71/barrel.
- Gold: -0.7% to $1732.08/ounce.
Treasurys:
- The 10-year U.S. Treasury bond yield climbed Monday to 1.672%.
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BlackRock's digital assets head: Leverage-driven volatility threatens bitcoin’s narrative
Rampant speculation on crypto derivatives platforms is fueling volatility and risking bitcoin’s image as a stable hedge, says BlackRock’s digital assets chief.
What to know:
- BlackRock digital-assets chief Robert Mitchnick warned that heavy use of leverage in bitcoin derivatives is undermining the cryptocurrency’s appeal as a stable institutional portfolio hedge.
- Mitchnick said bitcoin’s fundamentals as a scarce, decentralized monetary asset remain strong, but its trading increasingly resembles a "levered NASDAQ," raising the bar for conservative investors to adopt it.
- He argued that exchange-traded funds like BlackRock’s iShares Bitcoin ETF are not the main source of volatility, pointing instead to perpetual futures platforms.
