Bitcoin and Ether prices drop while XRP leads the top 10 losers in the cryptocurrency market, with US equity futures remaining stagnant

Bitcoin and Ether drop in Asia trading as XRP leads the losers among the top 10 cryptocurrencies. US equity futures trade flat ahead of CPI release and banking industry concerns.

May 8, 2023 - 03:48
May 8, 2023 - 07:42
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Bitcoin and Ether prices drop while XRP leads the top 10 losers in the cryptocurrency market, with US equity futures remaining stagnant
Image Credit: Forbes | Bitcoin and Ether drop in Asia trading

In the Asian morning trading hours on Monday, Bitcoin witnessed a decline in its value after struggling to break through the US$30,000 resistance level during the weekend. The price of Ether also fell below the US$1,900 level, whereas other top 10 non-stablecoin cryptocurrencies recorded mixed trading activity, with some trading flat while others recorded minor losses. Among the losers, XRP saw the most significant decline. On the other hand, U.S. equity futures remained unchanged after Friday's rally on Wall Street. Investors in the stock market are looking forward to the release of the U.S. Consumer Price Index (CPI) on Wednesday to assess the current pace of inflation. In addition, there is anticipation to find out if concerns over the banking industry will ease in the upcoming week.

Top 10 Cryptocurrencies Experience Loss of Momentum:

Bitcoin falls | image Credit: GOBankingRates

Bitcoin, the world's largest cryptocurrency, experienced a sharp drop of 1.34% to reach US$28,594, failing to cross the resistance level of US$30,000. The decrease occurred in the 24 hours leading up to 09:00 a.m. in Hong Kong, according to CoinMarketCap data. Ether, the second-largest cryptocurrency, also faced a similar setback. It dropped by 1.34% to reach US$1,882, inching down 0.10% for the week. The Ethereum Foundation, as per Etherscan data, transferred around 15,000 Ether (US$30 million) to crypto exchange Kraken, a move that usually precedes sales.

 

Except for Litecoin, which rose 0.71% to US$84.48, other top 10 non-stablecoin cryptocurrencies traded flat to lower for the past 24 hours. XRP led the losers, declining by 1.88% to US$0.4514, and moving down 4.31% for the week. Polkadot also saw a price drop of 0.40% to reach US$5.64, traded down 4.30% for the past seven days. However, despite the drop in price, the Polkadot blockchain is gaining acceptance from traditional finance. Deloitte, a renowned accounting firm among the Big Four, recently declared its adoption of the KLT protocol, a parachain on the Polkadot network. The primary aim of the integration is to upgrade the verification process for the company's Know Your Customer (KYC) and Know Your Business (KYB) checks.

 

The total crypto market capitalization fell 1.03% to US$1.18 trillion in the past 24 hours. The total trading volume fell 24.79% to US$28.93 billion. The downward trend in the crypto market might increase with the US President Joe Biden's push for a tax on cryptocurrency miners equivalent to 30% of the cost of the power they use. Miners may need to sell more Bitcoin to stay profitable, adding downward pressure to the crypto market.

NFT Market Shows Signs of Decline as Wash Trades Surge

The non-fungible token (NFT) market performance can be measured through indexes managed by CryptoSlam, which is a sister company of Forkast.News under the Forkast.Labs umbrella. The Forkast 500 NFT index dropped by 1.81% to reach 3,524.43 within a span of 24 hours, while it plummeted 5.59% for the week.

 

In the Ethereum blockchain, there was an increase of 1.69% in NFT sales during the 24-hour period, with the sales volume reaching US$14.99 million. However, the data from CryptoSlam reveals that "wash trades" of US$11.11 million, which increased by 30.27%, were also recorded. These trades involve an investor buying and selling an asset to manipulate prices and generate misleading trading volume, which is illegal in the U.S. securities markets.

 

Forkast Labs NFT strategist, Yehudah Petscher, explained that wash trades still make up a significant portion of monthly transactions, and are primarily driven by traders farming points on the Blur marketplace. According to his observations, the Forkast 500 index, which excludes wash sales, revealed a decline of more than 2%, indicating a reduction in the overall worth of the NFT market, despite the fact that the total USD volume of global NFT sales grew in the past week.

US stock futures mixed, concerns on debt default loom

Image Credit: Financial Times

At 9:00 a.m. in Hong Kong, U.S. stock futures were trading with little change, with the Dow Jones Industrial Average futures dropping 0.07%, the S&P 500 futures decreasing 0.10%, and the Nasdaq Composite futures inching down 0.09%. However, on Friday, the three U.S. stock indexes experienced a surge, fueled by strong earnings at Apple and a 4.69% increase in the company's share price. In addition, concerns about the U.S. banking sector were somewhat relieved after JPMorgan Chase upgraded the outlook of three U.S. regional banks, stating that their stock prices were "substantially mispriced," according to Bloomberg. Furthermore, the share price of PacWest Bancorp rose by 81% on Friday following a 50% decline the previous day.

 

According to Bloomberg on Sunday, April's Consumer Price Index (CPI) figures, to be released on Wednesday, are predicted to increase by 5.5% on a yearly basis, slightly lower than the previous month's 5.6% rise. This inflation rate is being monitored as an indicator of whether the Federal Reserve will halt its interest rate hikes in June. Meanwhile, concerns persist that the United States government may default on its debt as early as June, with U.S. Treasury Secretary Janet Yellen cautioning on Sunday that a constitutional crisis may arise if Congress does not raise the debt ceiling on time, according to Reuters.

 

According to Mikkel Morch, Chairman and Non-Executive Director at crypto hedge fund ARK36, in an emailed statement on Friday, the potential default of the U.S. government may "negatively impact the price of Bitcoin and other cryptocurrencies as part of a further risk-off approach by investors." The Fed's next move on interest rates is due on June 14, with analysts at the CME Group now predicting a 90.4% probability that the Fed will maintain interest rates at 5% to 5.25%, and a 9.6% probability of another 25 basis-point rate hike.

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