This Week in Coins: War and Inflation Dampen Crypto Investments
The cryptocurrency market witnessed a decline this week as Bitcoin and Ethereum remained relatively resilient compared to other altcoins. Prices experienced a slight drop due to the ongoing Israel-Palestine conflict and the persistent inflation indicated by the latest Consumer Price Index (CPI) report by the U.S. Bureau of Labor Statistics. During times of political and economic uncertainty, investors usually shift their focus to lower-risk assets.
Bitcoin (BTC), the market leader with a market capitalization of over half a trillion dollars, experienced a 3.7% decline over the past seven days, currently trading at $26,928 according to CoinGecko.
Ethereum (ETH), the second-largest cryptocurrency by market capitalization, faced a setback with a 5.4% drop this week, now trading at $1,554—its lowest price level since March.
While most of the top thirty cryptocurrencies did not post significant gains this week, several coins depreciated more than the market leaders. Polygon (MATIC) fell 8.6% to $0.521054, and Polkadot (DOT) experienced an 8% decline to $3.76. Avalanche (AVAX) suffered a major crash, plummeting 12.4% over the past seven days and currently trading at $9.19.
In the News
Adoption news and political developments regarding crypto regulation were scarce this week as global authorities focused on monitoring and responding to the Middle East situation.
Cathie Wood’s Ark Invest refiled its application for a Bitcoin spot exchange-traded fund (ETF). ETFs are investment products that allow investors to participate in Bitcoin’s growth without directly holding the cryptocurrency themselves. The filing acknowledges potential risks including community-driven changes to Bitcoin’s source code and concerns about the network’s electricity consumption.
Tether, the stablecoin giant, appointed Paolo Ardoino, the company’s Chief Technology Officer (CTO), as the new CEO, replacing Jean-Louis van der Velde (JL) in December.
There is a growing belief that the U.S. Securities and Exchange Commission (SEC) will soon approve a Bitcoin spot ETF. Reports surfaced on Friday, indicating that the SEC has decided not to appeal a previous verdict that ruled the regulator’s rejection of Grayscale’s proposal to convert its flagship Bitcoin fund into an ETF was “arbitrary and capricious.” This development suggests a positive trajectory towards a U.S. ETF.
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