Bitcoin back above $29,000, Ether gains; Matic leads winners on Polygon tools update

Danny Park

Wed, May 3, 2023, 10:23 PM 5 min read

Bitcoin and Ether both rose in early Thursday morning trading in Asia, with most other top 10 non-stablecoin cryptocurrencies mixed. Polygon’s Matic led the winners on network updates, while Ripple’s XRP dipped. U.S. stock futures fell, reflecting declines on Wall Street on Wednesday. The Federal Reserve raised interest rates by the expected 25 basis points, but Fed Chair Jerome Powell warned inflation is still a threat, raising concern more rate hikes are in the pipeline. U.S. lenders fell as investors remain unconvinced the industry is out of the woods after a series of bank failures since March.

See related article: Fed hikes rates by a quarter point, Bitcoin drops 0.48%

Crypto

Polygon's MATIC — Image: Envato Elements

Bitcoin moved back above the US$29,000 resistance line, gaining 1.23% to US$29,032 in the 24 hours to 8:00 a.m. in Hong Kong, according to CoinMarketCap data. The world’s largest cryptocurrency has gained 2.12% over the past seven days and breached its 20-day moving average.

Bitcoin is up 75% for the year to date and Standard Chartered Bank has forecast it may hit US$60,000 this year, considering the banking problems in the U.S. could convince some investors of Bitcoin’s role as a safe haven.

Ether, the second-largest token, gained 1.84% to US$1,905, up 2.06% for the week. The rest of the top 10 non-stablecoin cryptocurrencies by market capitalization were mixed.

Polygon’s Matic led the winners, rising 2.99% to US$1.01 and bumping up its weekly gains by 2.03%. On Wednesday, Polygon said it added updates to its network to improve use of decentralized applications, or dApps.

Ripple dipped 0.32% to US$0.4635.

Memecoins such as Dogecoin and Shiba Inu have also gained this year and Gordon Grant, co-head of trading at digital currency prime brokerage Genesis Trading, said failing banks could be a reason.

“The rise of meme coins amid a full-on banking crisis is not necessarily surprising. Amidst unstable banking systems, individuals may question the validity of their deposits and even the meaning of money,” Grant said in emailed comments.

“If bank deposits can theoretically evaporate overnight, it shouldn’t be a surprise that there is a marginal propensity to put money into a token with no obvious use-case other than the chance of selling at a higher price later.”

The total crypto market capitalization rose 1.14% in the past 24 hours to US$1.20 trillion, while trading volume gained 19.42% to US$41.97 billion.

NFTs

The indexes are proxy measures of the performance of the global NFT market. They are managed by CryptoSlam, a sister company of Forkast.News under the Forkast.Labs umbrella.

In the non-fungible token (NFT) market, the Forkast 500 NFT index dropped 1.69% to 3,648.07 in the 24 hours to 8:00 a.m. in Hong Kong, falling 1.65% for the week.

“I think it’s related to gas [fees]. It’s very high today and people were making comments about it when minting (or choosing to not mint because of it),” said Yehudah Petscher, NFT Strategist at Forkast Labs.

In other NFT developments, South Korea’s leading blockchain game maker Wemade launched the Bored Ape Golf Club (BAGC) NFT collection on its platform on Wednesday.

The golf-themed variation of the popular Bored Ape Yacht Club collection had 40,000 concurrent users during its presale period last year, according to Wemade’s press release. Wemade, established in 2000, services several play-to-earn video games globally including MIR4, and recorded over US$83 million in sales in Q4 of 2022.

And on Wednesday, U.S. prosecutors fired off a warning to NFT trading platforms in charging Nathaniel Chastain, the former head of product at the OpenSea NFT marketplace, with money laundering and fraud in what they called the “first ever digital asset insider trading scheme.”

Equities

GettyImages 1475361227 — Federal Reserve Chair Jerome H. Powell | Image: Getty Images

U.S. stock futures fell as of 8:00 a.m. in Hong Kong. Dow Jones Industrial Average futures lost 0.41%, the S&P 500 futures index dipped 0.37%, and the Nasdaq-100 futures edged down 0.03%. The three indexes all closed lower in regular Wednesday trading.

The U.S. Federal Reserve hiked interest rates by the expected 25 basis points to between 5 and 5.25%, the highest level since 2006. The Fed has repeatedly raised rates over the past year to try and bring inflation down to its target range of 2%. The inflation rate in March was at 5%, according to the U.S. Bureau of Statistics.

In announcing the increase the central bank’s chairman Jerome Powell damped down expectations that the Fed is now set to pause its policy of raising rates, saying the bank is “prepared to do more if greater monetary policy restraint is warranted,” during a press conference.

Nigel Green, the chief executive officer of financial advisory company deVere Group, said raising rates amid the brewing uncertainty about the health of U.S. banks is a mistake and could push the world’s largest economy into a longer-term recession.

“First, the crisis within the US financial system is still not over. There remain serious and legitimate concerns that after a string of bank failures, there could be more to come,” Green said in an emailed statement.

Another U.S. inflation indicator is due this week when job numbers for April are released on Friday.

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