Daily News | Swiss National Bank Explores Wholesale CBDC as BTC Inflows Rise, Alts Slide; Global Market Unfazed by Russia Turmoil
Crypto Daily Digest: Bitcoin Dominates Inflows, Ether and Altcoins Slide, Optimism Network Surges; Swiss National Bank Explores Wholesale CBDC
Bitcoin (BTC) experienced a decline in value following its recent surge to a one-year high. The positive momentum generated by news of filings from financial giants faded as investors realized that approval from the Securities and Exchange Commission (SEC) would take time, and macroeconomic indicators remained uncertain.
However, Markus Thielen, the head of research at Matrixport, remains optimistic about Bitcoin’s performance in July. He predicts a 10-20% increase in the next 30 days, potentially driving the price to reach $33,000 to $36,000 by August. Thielen has observed a pattern of Bitcoin rising $10,000 before experiencing a $5,000 drop, followed by subsequent rallies. Matrixport had previously forecasted Bitcoin reaching $45,000 by the end of the year.
In contrast, Ether (ETH) experienced a slight decline. Other major cryptocurrencies, including Cardano and Solana, were also down, except for Bitcoin Cash, which showed positive momentum by reaching a one-year high.
Meanwhile, digital asset investment products observed the largest weekly inflows in a year, with Bitcoin-related products driving the majority of the inflows. CoinShares reported that Bitcoin products received $188 million in inflows, accounting for 94% of the total. However, short Bitcoin products experienced outflows for the ninth consecutive week. Ethereum witnessed inflows of $7.8 million, although there was a lower appetite for Ethereum compared to Bitcoin.
The Optimism network, after implementing its Bedrock upgrade, witnessed a significant surge in transaction activity.
The upgrade aimed to enhance security, reduce deposit times, and lower fees. Transaction volume on the network tripled, reaching over 550,000 daily transactions by mid-June, per Nansen report.
In international development, the Swiss National Bank (SNB) announced its plan to launch a pilot project for a wholesale central bank digital currency (wCBDC). The wCBDC will be issued on the Swiss SIX digital exchange and will involve real transactions with market participants. This move signifies a shift in the SNB’s position on central bank digital currencies (CBDCs). While the SNB remains cautious about introducing a retail CBDC, it has not ruled out the possibility in the future.
Amid the recent political turmoil in Russia, there was an apparent increase in Russians seeking refuge in the stablecoin Tether. Trading volume of Ruble-denominated Tether tripled on June 24, indicating a preference for a less volatile asset amidst the political turmoil.
Bitcoin (BTC) $30,256 (-0.02%) - 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: Tech Stocks Slide, Bonds Rally Amid Rate Hike Concerns; Russian Turmoil Unfazed
US stocks experienced a decline while government bonds made gains as traders adjusted their expectations regarding the Federal Reserve’s stance on interest rates. The Nasdaq 100, which suffered its worst week since March, dropped by 1.4% for the second consecutive day. Technology stocks, including popular names like Nvidia and Meta Platforms, faced profit taking. Tesla also slumped by 6.1% following a downgrade from Goldman Sachs. Investors have grown concerned about central banks’ efforts to curb inflation, which could potentially harm fragile economies. As a result, traders have started to abandon their predictions of a rate cut by the Fed this year, particularly after Fed Chair Jerome Powell’s recent statement suggesting the possibility of rate increases in 2023.
Despite the political unrest in Russia, market impact has been limited. Analysts believe that as long as commodity prices remain stable, the global markets will largely ignore the volatility in Russian politics. Bond markets saw modest gains, but the yields on two-year and 10-year US Treasury bonds retreated slightly. Market participants are currently awaiting second-quarter earnings reports and further guidance from the Federal Reserve to gain a clearer outlook. The price of oil, although showing some upward movement, remained below $70 per barrel, as traders monitored the potential repercussions of prolonged turmoil in Russia on global crude markets.
Asian shares were expected to have a mixed start, reflecting concerns about the possibility of central banks worldwide pushing economies into a recession. While futures for Hong Kong and Australian benchmarks indicated gains, contracts for Japanese shares suggested a decline. US equity futures showed marginal growth during Asian trading, while major currencies remained relatively unchanged. Officials in Tokyo closely monitored the stability of the yen against the dollar, as its value near 143.40 raised concerns. Additionally, Australia’s 10-year government bond yield dropped by five basis points to 3.9%.
In summary, the market sentiment remains cautious as investors grapple with the potential impact of central bank actions on global economic stability. The focus is now on upcoming corporate earnings reports and further developments from the Federal Reserve, which could provide valuable insights for market participants.
