Bitcoin, Ether rise amid renewed recession fears after weaker-than-expected U.S. GDP
Bitcoin and Ether rose during Asian trading hours on Friday, while the top 10 non-stablecoin cryptocurrencies by market capitalization closed mixed. The SOL token saw the biggest gain. Asian equity markets strengthened after the Chinese central bank boosted short-term cash injections for the 11th day. European bourses fell after Germany’s first-quarter growth domestic product (GDP) showed signs of stagnation. Most U.S. stock futures strengthened, despite weaker-than-expected GDP data from the world’s largest economy.
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Fast facts
- Bitcoin rose 1.28% to US$29,367 in the 24 hours to 4:30 p.m. in Hong Kong. The world’s largest cryptocurrency gained 4.43% during the week after it rebounded from US$27,070 on Monday.
- “There was trouble in the traditional financial system which kind of propped up the value proposition of crypto,” said Justin d’Anethan, Institutional Sales Director at Amber Group. But he added that “prices needed to go much higher for US$30,000 to [become] a support line.”
- Ether rose 1.33% during the day to trade at US$1,914, but declined 0.48% on the week.
- “When the Shapella upgrade happened, many large Ethereum whales did not sell. They wanted to keep the price up so the narrative on staking capability would be bullish and people would feel optimistic about Ethereum,” said d’Anethan, adding that Ether’s short-term price trajectory is not bearish.
- Solana’s SOL token was the day’s biggest gainer in the top 10 cryptos, rising 3.67% to US$22.52, followed by the XRP token, up 2.63% to US$0.47.
- The global cryptocurrency market capitalization increased by 1.37% to US$1.21 trillion in the 24 hours to 4:30 p.m. in Hong Kong, while the total crypto market trading volume decreased by 36.46% to US$45.92 billion.
- The Forkast 500 NFT index inched down 0.11% to 3,721.74 points during the day and dropped 5.48% during the week. The index is a proxy measure of the performance of the global NFT market and includes 500 eligible smart contracts. It is managed by CryptoSlam, a sister company of Forkast.News under the Forkast Labs umbrella.
- “The Forkast 500 is a representation for the market as a whole, but it also reflects traders and what they’re doing or not doing and there is very low volume on the NFT markets right now,” Yehudah Petscher, Forkast Labs NFT strategist, said in an interview. Wash trading remains a problem, he said.
- “Still, there’s good stuff happening in the NFT space, with communities building and growing,” said Petscher. “Also, the art is world class and that is an important thing that’s happening in the NFT space where digital artists now can make a living by selling their NFTs. Sotheby’s and Christie’s are selling NFT art at this point regularly,” he added.
- Asian equities strengthened for a second consecutive day, lifted by Thursday’s upbeat session on Wall Street, and easing concerns over geopolitical pressures after China’s President Xi Jinping yesterday made his first phone call to Ukraine’s President Zelensky since the Russian invasion, discussing cooperation towards peace.
- Market sentiment also received a boost from the People’s Bank of China reportedly stepping up short-term cash injections into the banking system for the 11th consecutive day, the longest streak this year, to ease investor concerns over a potential liquidity squeeze.
- European bourses weakened, following signals of stagnation from Europe’s largest economy, after Germany’s gross domestic product was flat in the first quarter of 2023, missing preliminary market expectations of a 0.2% expansion.
- Most U.S. stock futures gained on Friday, besides the S&P 500 Futures that fell 0.47%. Investor concerns over a recession in the world’s largest economy grew, after U.S. GDP rose 1.1%, below an estimate of 2%. Inflation in the first quarter stood at 4.2%, above estimates of 3.7%. Business inventories also declined, typically an indicator of an economic downturn.
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