Key facts:
Despite the downtrend, the market value of stablecoins has rebounded.
Bitcoin spot market volumes fell 40% from January to March 2022.
Mercados al día is an exclusive summary of the news that moves the bitcoiner economy. It is sent in advance by email to a list of subscribers and then published every Monday in CriptoNoticias. If you want to have the information in advance,subscribe to the list here.
In the last two weeks, the price of bitcoin (BTC) has fallen 16.2% from $46,579 to its current price of $39,020. In the past week, price fluctuations have softened the decline to 7.1%, reflecting countervailing market forces such as new institutional investment initiatives, along with profit-taking selling by whales, as CriptoNoticias reported last Monday, April 11.
The analysis highlights that the bulls, the investors looking for the price upside, failed to defend the $46,000 support level, despite significant purchases at that price, including one from major corporate whale MicroStrategy, which bought $190 million. dollars in BTC. The Luna Foundation Guard, coordinated by Terra, continues its campaign to accumulate bitcoin and bought an additional USD 100 million of BTC on April 13.
Advertising
Institutional buyouts of bitcoin have not pushed the price higher, although they seem to have acted as a price containment net to profit taking by some whales. As seen in the chart below, after the 6.4% drop on Monday, April 11, to USD 39,600, the price managed to break above USD 40,000 this Friday, April 15.
Could the price of bitcoin drop further?
The fear and uncertainty caused by the price decrease reached this Friday a value of 22, which represents “Extreme Fear”, according to the index of fear and greed. This means that a significant number of investors could be thinking of selling. Several specialists exposed bearish signs in the market that would indicate that the price could fall even more, as we reported in this medium. Among these signs, analyst Alí Martínez mentions that the number of addresses with more than USD 10,000 in BTC fell 4.6% in four days.
Study analyzes cryptocurrency market crash
A study by CoinGecko commented by CriptoNoticias last Thursday the 14th reveals that, while the cryptocurrency market has decreased its market capitalization by 15% so far this year, the capitalization of the top 5 stablecoins has rebounded 13% in the same period. This increase in capital towards currencies pegged to the US dollar may indicate investors’ hedging in the midst of a bear market and high volatility. As the chart below shows, the total market value of major stablecoins grew by $23 billion over the past two quarters.
Advertising
Tether (USDT) maintains the leadership in market value, but USD Coin (USDC), Binance USD (BUSD) and Terra UST show larger increases in market capitalization.
Bitcoin volumes fall on exchanges
In addition to the negative performance of most of the cryptocurrencies in the market, including bitcoin, there has been a sharp decline in BTC trading volumes on exchanges, during the first quarter of 2022. This is another of the findings of the report of CoinGecko.
The largest decline was seen in trading spot or in cash, which was 40% compared to the last quarter of 2021. For their part, the derivatives markets had a much less pronounced fall in the period, between 7% and 12% decrease in capital flow compared to the last quarter of last year.
Featured chart of the week
When it comes to separating the bitcoin market participants who are in profit, it is usually differentiated between short-term and long-term holders. Other points of view are shown in this chart from Glassnode: the evolution of the percentages of Bitcoin supply, entities and addresses that are in profit.
The highlight of this graph is the contrast between different bear markets, and how the percentages of the mentioned parameters are increasing. In the 2015 bear market between 30% and 42% of the quoted variables were in profit. Three years later, when bitcoin fell to $3,000 in December 2018, that range jumped from 45% to 50%. In the current bear market, between 70% and 75% of supply, entities and addresses are in profit. If the historical trend continues, we would also be at the beginning of a bullish price stage.
Unstoppable inflation in the United States
For the third consecutive month, the annual increase in the Consumer Price Index (CPI) reaches maximum values that were not recorded four decades ago. March’s 8.53% increase in CPI, compared to March 2021, is not only the highest since 1981, but when energy and food items are considered, the percentages go beyond double digits.
For example, gasoline saw an 18% rise in March in the US. The March figures are the first to be released after the Russian invasion of Ukraine, which explains the notable increase in gasoline and other energy products.