CRYPTO week ahead: March 13 – 19
Last week in the news
Previous week brought the game of nerves on financial markets. At the beginning of the week FED Chair Powell stressed that the interest rates would have to go higher from previously estimated levels, while the week-end brought concerns over potential collapse of the Silicon Valley Bank. Both US and EU equities finished the week in red. Not a better situation was on the crypto market, where Bitcoin ended the week around $20K resistance, and Ether is holding above $1.4K.
The Federal Reserves were for one more time a game-changer on financial markets. Although the beginning of this year brought at least some positive sentiment that the fight against inflation might soon be over, after the FOMC started slowing down increase in its interest rates, a FED Chair`s Powell Congress testimony revealed that the FED is not even near its previous estimates. Namely, he openly noted in testimony that the rates could go even higher from currently anticipated 5,25% if inflation remains persistent and probably the increase would be at a faster pace from current 25 bps. Markets immediately changed expectations for a 50 bps increase in rates in March, from previous 25 bps. Based on data published on Friday, the US nonfarm payrolls rose 311K, more than market estimate, confirming the assumption that inflator pressures will persist, as well as FED's rate increases.
Troubled crypto-friendly Silvergate bank was in the market spotlight during the previous period, but during the previous week it has officially noted that the bank is winding down its further operations. However, at the end of the previous week there was news about venture-capital-friendly Silicon Valley Bank. The bank went into trouble after not being able to secure funds for further operations. Namely, the Silicon Valley Bank was well known in the Silicon Valley as a financial institution which was strongly supporting start-ups especially in the tech industry. Since the latest meltdown on the financial and crypto market, many depositors withdraw their funds, and the bank was not able to secure further funding even after a sale of its Tbonds worth $21 billion with $1.8 billion of loss, neither was able to secure $2 billion of additional capital. The bank is currently under supervision of the Federal Deposit Insurance Corporation in order to secure the rest of deposits. The final resolution for the bank will probably be known during the following week.
Not all investors see current developments as negative. Cathie Woods is one of the rare investors still ready to buy at significant discounts and current prices. As per news, Ark Invest bought additional $22 million worth shares of Coinbase. With the latest purchase the Fund currently owns 9,9 million of COIN shares with market value of $575 million, or 3,8% of COIN shares.
Crypto market cap
FED was once again a game-changer. Trading on financial markets during the first half of the week was a reflection of FED Chair Powell`s testimony in the US Congress, where he expressed views on potential higher interest rates from previously projected if inflation persists. At the same time, he noted a possibility for pace of rate increases to be higher from previous 25 bps. Markets immediately reacted where 2Y Treasury bonds reached levels above 5%. Equity markets were traded lower, and the crypto market followed. The end of the week was marked with another shock, when VC-friendly Silicon Valley Bank collapsed after experiencing significant outflow of deposits. That event triggered a significant sell-off on the crypto market, where all coins lost a huge portion of the value. Total crypto market capitalization ended the week 7% lower from the week before, losing additional $68B. Crypto market cap is still holding above $900 trillion and is still in a positive territory compared with the end of the previous year. Daily trading volumes were increased to the level of $170B on a daily basis, compared to $56B traded during the week before. Total crypto market capitalization has increased by 21% since the beginning of this year, adding total $156B to the market cap.
The only coin which gained during the previous week was Tether, by adding a 1,90% to the volume of coins in circulation. Majority of stablecoins were affected with the latest downturn, where USDC fell below $1.0 peg. Major coins on the market were participating with 80% in total crypto market cap drop in nominal terms during the previous week. Bitcoin was down by 8,9%, losing $38B in market cap. Ether followed BTC and dropped its market cap by 7.3% or $14B. BNB was also affected, where its market cap was decreased by $2.1B or almost 5%. Solana was also down by $1.1B or by more than 15%. Other coins with significant drop in value in relative terms were Litecoin, who dropped by 24%, NEO was down by 23%, DASH dropped by more than 32%, OMG Network decreased its value by 24%. As for coins in circulation, during the previous week Monero decreased its circulating coins by 5,2% w/w, EOS coins were down by 0.3%. while Filecoin continues with its strong push for the circulating coins, increasing its number by 5,2% during the previous week.
Crypto futures market
It has been the third straight week in which both BTC and ETH futures were traded at lower grounds. At the same time, the last week`s market run-off triggered over $300 million losses in liquidations of the open positions and margin calls. Coins traded on CME exchange ended the Friday trading lower from the current spot prices. BTC short term futures were traded by more than 10% lower from the end of the previous week, while longer term futures were down slightly below 15%. BTC futures maturing as of the end of this year were traded at price of $20.63K, while December 2023 was traded at price $21.33K.
ETH short term futures were traded lower by less than 10%, while longer term futures prices dropped by more than 14%. ETH futures maturing as of the end of this year ended the week at price $1.44K, while those maturing in December 2023 were traded at price $1.470.
Previous week brought the game of nerves on financial markets. At the beginning of the week FED Chair Powell stressed that the interest rates would have to go higher from previously estimated levels, while the week-end brought concerns over potential collapse of the Silicon Valley Bank. Both US and EU equities finished the week in red. Not a better situation was on the crypto market, where Bitcoin ended the week around $20K resistance, and Ether is holding above $1.4K.
The Federal Reserves were for one more time a game-changer on financial markets. Although the beginning of this year brought at least some positive sentiment that the fight against inflation might soon be over, after the FOMC started slowing down increase in its interest rates, a FED Chair`s Powell Congress testimony revealed that the FED is not even near its previous estimates. Namely, he openly noted in testimony that the rates could go even higher from currently anticipated 5,25% if inflation remains persistent and probably the increase would be at a faster pace from current 25 bps. Markets immediately changed expectations for a 50 bps increase in rates in March, from previous 25 bps. Based on data published on Friday, the US nonfarm payrolls rose 311K, more than market estimate, confirming the assumption that inflator pressures will persist, as well as FED's rate increases.
Troubled crypto-friendly Silvergate bank was in the market spotlight during the previous period, but during the previous week it has officially noted that the bank is winding down its further operations. However, at the end of the previous week there was news about venture-capital-friendly Silicon Valley Bank. The bank went into trouble after not being able to secure funds for further operations. Namely, the Silicon Valley Bank was well known in the Silicon Valley as a financial institution which was strongly supporting start-ups especially in the tech industry. Since the latest meltdown on the financial and crypto market, many depositors withdraw their funds, and the bank was not able to secure further funding even after a sale of its Tbonds worth $21 billion with $1.8 billion of loss, neither was able to secure $2 billion of additional capital. The bank is currently under supervision of the Federal Deposit Insurance Corporation in order to secure the rest of deposits. The final resolution for the bank will probably be known during the following week.
Not all investors see current developments as negative. Cathie Woods is one of the rare investors still ready to buy at significant discounts and current prices. As per news, Ark Invest bought additional $22 million worth shares of Coinbase. With the latest purchase the Fund currently owns 9,9 million of COIN shares with market value of $575 million, or 3,8% of COIN shares.
Crypto market cap
FED was once again a game-changer. Trading on financial markets during the first half of the week was a reflection of FED Chair Powell`s testimony in the US Congress, where he expressed views on potential higher interest rates from previously projected if inflation persists. At the same time, he noted a possibility for pace of rate increases to be higher from previous 25 bps. Markets immediately reacted where 2Y Treasury bonds reached levels above 5%. Equity markets were traded lower, and the crypto market followed. The end of the week was marked with another shock, when VC-friendly Silicon Valley Bank collapsed after experiencing significant outflow of deposits. That event triggered a significant sell-off on the crypto market, where all coins lost a huge portion of the value. Total crypto market capitalization ended the week 7% lower from the week before, losing additional $68B. Crypto market cap is still holding above $900 trillion and is still in a positive territory compared with the end of the previous year. Daily trading volumes were increased to the level of $170B on a daily basis, compared to $56B traded during the week before. Total crypto market capitalization has increased by 21% since the beginning of this year, adding total $156B to the market cap.
The only coin which gained during the previous week was Tether, by adding a 1,90% to the volume of coins in circulation. Majority of stablecoins were affected with the latest downturn, where USDC fell below $1.0 peg. Major coins on the market were participating with 80% in total crypto market cap drop in nominal terms during the previous week. Bitcoin was down by 8,9%, losing $38B in market cap. Ether followed BTC and dropped its market cap by 7.3% or $14B. BNB was also affected, where its market cap was decreased by $2.1B or almost 5%. Solana was also down by $1.1B or by more than 15%. Other coins with significant drop in value in relative terms were Litecoin, who dropped by 24%, NEO was down by 23%, DASH dropped by more than 32%, OMG Network decreased its value by 24%. As for coins in circulation, during the previous week Monero decreased its circulating coins by 5,2% w/w, EOS coins were down by 0.3%. while Filecoin continues with its strong push for the circulating coins, increasing its number by 5,2% during the previous week.
Crypto futures market
It has been the third straight week in which both BTC and ETH futures were traded at lower grounds. At the same time, the last week`s market run-off triggered over $300 million losses in liquidations of the open positions and margin calls. Coins traded on CME exchange ended the Friday trading lower from the current spot prices. BTC short term futures were traded by more than 10% lower from the end of the previous week, while longer term futures were down slightly below 15%. BTC futures maturing as of the end of this year were traded at price of $20.63K, while December 2023 was traded at price $21.33K.
ETH short term futures were traded lower by less than 10%, while longer term futures prices dropped by more than 14%. ETH futures maturing as of the end of this year ended the week at price $1.44K, while those maturing in December 2023 were traded at price $1.470.
