Daily News | BTC Volatility Triggers Alts Sell-Off, Fidelity's ETF Ambitions, Mastercard's Tokenization, and BlackRock's AI Optimism
Crypto Daily Digest: Bitcoin Market Volatility Triggers Altcoin Sell-off as Fidelity Explores ETF and Mastercard Advances Tokenization
In the ever-fluctuating world of cryptocurrencies, Bitcoin‘s recent drop below $30,000 sent shockwaves through the market, causing a sell-off in smaller cryptocurrencies, known as altcoins. Bitcoin’s price briefly dipped to around $29,860, representing a 1.8% decline over the past 24 hours. As a result, altcoins such as OP, ADA, MATIC, and AVAX suffered substantial losses, ranging from 6% to 10%. While Ether fared slightly better, it still experienced a slide of 3.2%. These developments caused Bitcoin’s dominance in the digital asset market to surge above 52% for the first time since April 2021.
However, amidst the market turmoil, there are positive developments on the horizon. Fidelity, the renowned asset management firm, is reportedly preparing to file for a spot Bitcoin exchange-traded fund (ETF). Fidelity’s upcoming ETF filing marks its second attempt after a previous application was denied by the US Securities and Exchange Commission (SEC) in 2022. The anticipation surrounding Fidelity’s filing, coupled with the recent ETF application from BlackRock, signals growing institutional interest and brings renewed Optimism to the crypto industry, despite lingering regulatory challenges.
In parallel, ARK Invest, under the leadership of Cathie Wood, has made significant amendments to its filing for a spot Bitcoin ETF. In a bid to align with BlackRock’s application, ARK has included a surveillance-sharing agreement, an important step towards preventing market manipulation. This inclusion places ARK’s application in a favorable position for potential approval, positioning the spot Bitcoin ETF listing on the horizon.
Meanwhile, global payment giant Mastercard is making strides in exploring the tokenization of bank deposits. Their new testbed, known as the Multi-Token Network (MTN), aims to unlock the potential of tokenized assets, starting with bank deposits. The initiative will begin as a beta version in the UK this summer. With plans to expand into central bank digital currencies (CBDCs) and regulated stablecoins, Mastercard aims to bring programmability and efficiency to traditional banking processes, while ensuring compliance with regulations like anti-money laundering.
In the realm of Bitcoin-friendly apps, Damus, a social media platform, has recently received approval to remain in the Apple App Store following a two-week battle. Initially threatened with removal due to violations of in-app purchase guidelines, Damus has made the necessary modifications to comply with Apple’s requirements. While some compromises were made, Damus users can still engage in peer-to-peer transactions at the profile level. The approval, although met with mixed reactions, is seen as a positive step forward for Bitcoin integration in mainstream platforms.
Bitcoin (BTC) $30,121 (+0.13%) - Neutral Outlook
Overview:
- Closest daily support zone: 30025 - 29475
- Closest daily resistance zone: 30690 - 31015
- Key Level: 28420 (Weekly High Between Dec. 21-28, 2020)
Daily Resistance zones
- 30690 - 31015
- 31530 - 32255
- 33100 - 33600
Daily Support zones
- 30025 - 29475
- 29095 - 28420
- 27970 - 27265
Macro: Investors Navigate Central Bank Hawkishness; BlackRock’s Bullish Call on AI
Stock futures in Asia indicated a subdued start to trading as investors weighed the hawkish stance of central banks and positioned themselves for the end of the quarter. Japanese shares showed a slight rise in futures, while Australian and Hong Kong futures declined. Meanwhile, US-listed Chinese equities experienced a decline. Currencies such as the Australian and New Zealand dollars stabilized after a previous drop against the US dollar, while the yen remained relatively unchanged.
The cautious sentiment followed comments from Bank of Japan Governor Kazuo Ueda, who suggested the possibility of normalizing monetary policy if inflation shows signs of improvement next year. Ueda made these remarks at a central banking forum in Portugal, where Federal Reserve Chair Jerome Powell hinted at potential rate hikes in upcoming meetings. Adding to the hawkish tone, European Central Bank President Christine Lagarde also signaled the likelihood of a rate hike next month.
Back in the US, Wall Street traders reacted calmly to Powell’s comments, resulting in lower bond yields and fluctuating stocks. The S&P 500 experienced a mixed performance as chipmakers faced a decline, which was offset by gains in tech giants like Apple and Microsoft. After the market closed, Bank of America and Wells Fargo led gains in the financial sector as they passed the Federal Reserve’s stress test, clearing the way for potential payouts. Micron Technology also saw a jump in stock price following a positive forecast.
Investors are anticipating potential volatility in the market due to quarter-end positioning. They are increasingly factoring in the possibility of a soft landing and focusing on the reacceleration of earnings to drive the next phase of the market. Despite Powell downplaying the likelihood of a recession, the swap market showed little change in its bets on further tightening.
In other market news, BlackRock expressed a bullish outlook on artificial intelligence (AI), highlighting its potential as a driving force for returns. This comes amid a rally that has propelled the Nasdaq 100 towards its best-ever first half of the year.
Commodities also had their share of movements, as oil prices declined following a previous session gain. On the other hand, gold edged up slightly. Overall, investors are closely monitoring central bank actions and economic indicators as they navigate the evolving market landscape.
