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Bitcoin Hovers Around $30K, Ether Holds Above $1.9K Ahead of Ethereum Shanghai Upgrade
Investors are awaiting Ethereum’s "hard fork," which is expected to go live late Wednesday.
By Jocelyn Yang
Updated Apr 12, 2023, 8:30 p.m. Published Apr 12, 2023, 6:19 p.m.
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Bitcoin (BTC) hung precariously around $30,000 Wednesday afternoon after the latest Consumer Price Index (CPI) report showed inflation cooling slightly but not by as much as economists had expected.
The largest cryptocurrency by market capitalization was recently at $30,030, off a few fractions of a percentage point over the past 24 hours, according to CoinDesk’s data. BTC’s price reached as high as $30,548 earlier Wednesday after the Bureau of Labor Statistics’ much-watched inflation reading showed the CPI rising 0.1% increase in March, slower than economists' 0.2% forecast for the month and then February’s 0.4% reading. On a year-over-year basis, the CPI was higher by 5%, down from 6% in February and against expectations of 5.2%.
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BTC's profit-taking is "intensifying" following the report, Edward Moya, senior market analyst at foreign exchange Oanda, wrote in a Wednesday note.
“It seems the momentum rally for bitcoin might be over for now,” Moya wrote. “Inflation hedge and or a breaking of its correlation from equities might subside for a while.” He added that BTC looks poised to consolidate as "it will clearly need a robust catalyst to keep the rally going.”
Ether (ETH), the second-largest cryptocurrency in market value, was recently trading at $1,914, up 0.3% from Tuesday, same time. Validators and market watchers are eyeing Ethereum’s Shanghai (or Shapella) upgrade, which is scheduled to go live at 6:27 p.m. ET (22:27 UTC).
Read more: LIVE BLOG: Ethereum's Shanghai Upgrade
Crypto analysts and traders are split on the event’s market impact with some expecting ETH selling pressure to send the token’s price downward, but others foreseeing little significant price impact.
“While there is plenty of short-term concern around what happens once staked ETH is unlocked, long term the ability to enter and exit at will opens the doors for new entrants to the market that may have been wary of locking their funds for an indeterminate period of time,” Jim Myers, founder and chief technology officer at blockchain analytics platform Flipside Crypto, told CoinDesk in an email.
BTC and ETH have risen by more than 6% and 4%, respectively, in the past seven days. The CoinDesk Market Index (CMI), which measures the overall crypto market performance, was down 0.2% for the day but rose by 2.2% in the past seven days.
Equity markets turned mixed on Wednesday afternoon. The S&P 500 and Dow Jones Industrial Average (DJIA) were recently trading up 0.3% and 0.5%, respectively. The tech-heavy Nasdaq was almost flat.
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What to know:
- Even a 1% crypto allocation in standard portfolios across Asia could translate into nearly $2 trillion of inflows, highlighting how modest shifts in asset allocation could transform the digital asset market, according to the head of APAC iShares at BlackRock, Nicholas Peach.
- BlackRock's iShares unit, whose U.S.-listed spot Bitcoin ETF IBIT has rapidly grown to about $53 billion in assets, is seeing strong demand from Asian investors as ETF adoption accelerates across the region.
- Regulators in markets such as Hong Kong, Japan and South Korea are moving toward broader crypto ETF offerings, but industry leaders say investor education and portfolio strategy will be critical to channeling traditional finance capital into digital assets.
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