In brief
- Bitcoin hit record highs, before losing $70 billion.
- Other projects faced similar highs and large losses.
- US Markets are awaiting earnings reports from Airbnb and a statement from the Fed on its support of the economy.
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Another weekend, another wild ride for crypto. Bitcoin has had a tendency to move aggressively over weekends - in 2021 several records have been broken on Saturdays and Sundays. This weekend was no different.
On the back of a raft of new investors entering the space late last week, Bitcoin pushed beyond $55,000 and climbed all the way into the $58,000s.
But as soon as BTC hit those highs, it began a steep decline. In little more than 12 hours, Bitcoin had shaved $70 billion off the project’s market cap, reminding investors that while the currency is up 93% in 2021 alone, it still has a whip in its tail.
Ethereum shared a similar fate over the weekend. It too hit record highs, surging past $2,000 for the first time in the project’s history. But after breaking through the $2k barrier, it began a correction, pulling back to the $1,800s according to data company Nomics.
While a slew of corollary crypto projects saw similar rises and falls, some projects saw their token prices soar over the weekend.
OKEx’s Utility Token, OKB is up 27% in the last 24 hours as its delisting of Bitcoin Cash and Bitcoin SV appears to have had a galvanising effect on the project’s value.
Within hours of the announcement on Friday, the project’s price shot up before continuing to climb over the weekend, doubling its market value. For the currencies it decided to delist, they fared less well.
Bitcoin Cash saw its price plummet on the news before rebounding briefly over the weekend. For Bitcoin SV however, while the price is up 2% in the last 24 hours, the news has pushed it out of the top 20 cryptocurrencies by market cap as trading volume crashed 16%.
The other big winner in crypto’s top 20 was Crypto.com. The exchange had been in steep decline after it slashed its rewards program for staking its native CRO token in October.
But over the weekend, its token is up 62%. In fact, this month the project is up 275%. Why the sudden interest? The Binance effect. With BNB now the world’s third largest token, investors have been sniffing around other exchange tokens in search of similar opportunities.
Huobi’s native token has doubled in the last few weeks as investors hope these exchanges will follow the success of Binance. Will they? Who knows. But the bigger story is how despite Bitcoin reaching a market cap of $1 trillion, its dominance over crypto has stayed rooted at 60%.
The increased diversity among crypto’s biggest projects - and the ability for projects to do well even when bigger ones don’t - helps lay to the rest the idea that crypto is a one trick pony.
Corporate earnings from Airbnb and DoorDash as Fed Releases New Report
Markets are looking ahead to earnings reports from two of Wall Street's latest editions: Airbnb and DoorDash. The two projects will be issuing their first reports this week, with both expected to show strong performance, despite Airbnb's business being battered by COVID.
The Federal Reserve meanwhile is expected to give its semi-annual testimony to Congress this week about the state of the US economy.
The US central bank is expected to keep pumping money into the economy and keep interest rates at ultra-low levels. That's largely down to disappointing growth in the job market suggesting that the economy is far from a full recovery.
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