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Crypto Markets Analysis: Cryptos Upswing Stalls This Week Amid Fresh Regulatory Concerns
Bitcoin and ether decoupled from traditional assets as the crypto industry’s main narrative shifted from macroeconomic uncertainty to the SEC’s agreement with exchange giant Kraken and the possibility of new regulation.
Feb 10, 2023, 9:56 p.m.
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Bitcoin and ether momentum stalled this week as investors fretted first about vibrant jobs data and continued U.S. central bank hawkishness, and then about the potential for increased crypto regulation. Kraken’s agreement to sunset liquidity staking services for U.S. customers particularly darkened the market mood late Thursday.
Bitcoin and ether dropped 6.8% and 7.3% over the last seven days, respectively, losing a sizable chunk of their gains from the first five weeks of 2023. Both are now up about 30% year to date – spearheads in a wider crypto revival – although this week’s declines supported a number of analysts who have predicted that bitcoin support will sink to the $20,000 level.
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The week also marked cryptos’ decoupling from traditional finance indexes, with the correlation between bitcoin and the S&P 500 falling more than 50%. Many leading digital assets spent much of the week in the red.
Top performers
Among the top 20 cryptocurrencies by market capitalization, excluding stablecoins, only Polygon's MATIC finished the week in positive territory. BTC and ETH ranked sixth and ninth, respectively.
Solana and were the weekly laggards, with both down more than 15%. The large number of declining assets sharply contrasts to the prior week, when 16 of the 20 assets finished higher.
While the macro narrative has dominated crypto markets for much of 2023, industry-specific developments assumed center stage starting late Wednesday and culminating Thursday with Kraken’s agreement to settle Securities and Exchange Commission (SEC) charges that its staking services for U.S. retail investors amounted to offering unregistered securities. Along with halting the offering, Kraken will pay a $30 million fine.
SEC Chairman Gary Gensler’s warning for crypto companies to “take note” and “fall into compliance” following the Kraken announcement presented a larger, long-reaching overhang for the industry. The statement clearly signaled the SEC will be stepping up its crypto regulatory efforts.
The risks to crypto markets appear to be shifting from all-encompassing systematic risk to sector-specific nonsystematic risk, and investors should monitor the flow of coins to and from exchanges for bullish and bearish signals.
The Exchange Net Position change for BTC has been negative this week, implying that investors are transferring coins from exchanges into storage (bullish). A shift in this trend, however, would indicate that investors are becoming leery of BTC’s immediate prospects and sending coins to exchanges to be sold (bearish).
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KuCoin captured a record share of centralised exchange volume in 2025, with more than $1.25tn traded as its volumes grew faster than the wider crypto market.
What to know:
- KuCoin recorded over $1.25 trillion in total trading volume in 2025, equivalent to an average of roughly $114 billion per month, marking its strongest year on record.
- This performance translated into an all-time high share of centralised exchange volume, as KuCoin’s activity expanded faster than aggregate CEX volumes, which slowed during periods of lower market volatility.
- Spot and derivatives volumes were evenly split, each exceeding $500 billion for the year, signalling broad-based usage rather than reliance on a single product line.
- Altcoins accounted for the majority of trading activity, reinforcing KuCoin’s role as a primary liquidity venue beyond BTC and ETH at a time when majors saw more muted turnover.
- Even as overall crypto volumes softened mid-year, KuCoin maintained elevated baseline activity, indicating structurally higher user engagement rather than short-lived volume spikes.
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Here’s why bitcoin’s is failing its role as a 'safe haven' versus gold
Bitcoin behaves more like an "ATM" during uncertain times, with investors quickly selling it to raise cash.
What to know:
- During recent geopolitical tensions, Bitcoin lost 6.6% of its value, while gold rose 8.6%, demonstrating bitcoin's vulnerability in times of market stress.
- Bitcoin behaves more like an "ATM" during uncertain times, with investors quickly selling it to raise cash, contrary to its reputation as a stable digital asset.
- Gold remains the preferred hedge for short-term risks, while bitcoin is better suited for long-term monetary and geopolitical uncertainties that unfold over years.
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