Omkar Godbole was a senior reporter on CoinDesk's Markets team.

Parikshit Mishra is the news editor for CoinDesk during the mid Asia and early European hours. He does not have any crypto holdings.

Good morning, and welcome to First Mover, our daily newsletter putting the latest moves in crypto markets in context. Sign up here to get it in your inbox each weekday morning.

Here’s what’s happening this morning:

  • Market Moves: Bitcoin jumps to $47,000, confirming a bullish breakout. Ether taps two-and-a-half-month highs as popular interest in Etheneum's impending proof-of-stake upgrade surges.
  • Featured stories: A section of the U.S. Treasury yield curve inverts, signaling economic recession ahead.

And check out the CoinDesk TV show “First Mover,” hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9:00 a.m. U.S. Eastern time.

  • Bill Barhydt, CEO, Abra
  • David Ripley, COO, Kraken
  • Dyma Budorin, co-founder and CEO, Hacken
  • Samir Kerbage, chief technology officer, Hashdex

Market Moves

By Omkar Godbole

Cryptocurrencies gained ground early Monday, shrugging off the cautious mood in traditional markets.

Bitcoin jumped above $47,000, triggering over $300 million in short liquidations, according to data provided by Swiss-based crypto derivatives tracking platform Laevitas.

According to observers, continued purchases of bitcoin by the Luna Foundation Guard, a nonprofit organization focused on stablecoin UST, helped the cryptocurrency break out of its two-month triangular consolidation.

"Increased holding by long-term investors backs the recent rise in the cryptocurrency's price. As BTC surpasses $47,000 again, the balance held by hodlers - addresses holding >1year, is currently at ATH [all-time high]," blockchain analytics firm IntoTheBlock tweeted. "Hodlers increased their positions by 17% since late November. These addresses remained unfazed and accumulated throughout Q1 of 2022."

Ether (ETH), the native token of Ethereum's blockchain, tapped two-and-a half-month highs near $3,350. "FOMO (fear of missing out) is kicking for ETH pre-merge," Ilan Solot, a partner at the Tagus Capital Multi-Strategy Fund, said in an email.

Google Trends, a widely used tool to gauge general or retail interest in trending topics, recently showed a peak value of 100 for the worldwide search query "Ethereum Merge" for the past 12 months.

Google Trends provides access to a mostly unfiltered sample of actual search requests made to Google and scales the searches on a range of 0 to 100, according to the company. The search value represents the search interest relative to the highest point on the chart for the selected region and time.

"There’s been an increasing amount of mainstream coverage about the Ethereum merge, particularly around how it will lead to ETH’s supply decreasing," Lucas Outumuro, head of research at IntoTheBlock, said in a weekly newsletter published Sunday. "Additionally, the reduced environmental impact coming from the transition to proof of stake has also began making news."

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Google search interest in the impending Ethereum Merge. (IntoTheBlock, Google Trends)

Peak popular interest doesn't necessarily imply an increase in actual buying pressure from retail investors as people often search for information but don't act. That said, investors could step in this time, given that ether is fast gaining ground and analysts are making bullish predictions on the second-largest cryptocurrency.

Tokens associated with smart contract blockchains like Polkadot and Solana registered double-digit gains on a 24-hour basis. Web 3 heavyweights FIL, THETA and GRT rose 27%, 15% and 12%, respectively.

The regulatory risk was back on the table with the European Union likely to vote on stricter rules for private wallets as part of anti-money-laundering checks, including scrapping the €1,000 ($1,100) limit for reporting transfers, Solot said.


Latest Headlines

U.S. Yield Curve Inverts

By Omkar Godbole

Data tracked by charting platform TradingView shows that a section of the Treasury yield curve inverted early on Monday. The spread between yields on the 30- and five-year government bonds fell under zero for the first time since 2006 – a year before the great financial crisis of 2007-2008.

The spread between the 10- and two-year yields, another widely tracked section of the yield curve, was 12 basis points short of inversion at press time.

An inverted yield curve is widely read as a sign of impending economic recession, a significant decline in economic activity that lasts for months or even years. According to the Federal Reserve Bank of San Francisco, the yield curve has inverted before each recession since 1955, with the economy taking a hit between six and 24 months following the inversion.

The recession hint provided by the latest curve inversion could have bearish implications for bitcoin. While the cryptocurrency hasn't develop strong links to economic activity yet, it has evolved as a macro asset since the coronavirus crash of March 2020 and tends to move in line with risk assets, mainly technology stocks, which are sensitive to economic cycles.

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Omkar Godbole was a senior reporter on CoinDesk's Markets team.

CoinDesk - Unknown

Parikshit Mishra is the news editor for CoinDesk during the mid Asia and early European hours. He does not have any crypto holdings.

CoinDesk - Unknown

Omkar Godbole was a senior reporter on CoinDesk's Markets team.

CoinDesk - Unknown

Parikshit Mishra is the news editor for CoinDesk during the mid Asia and early European hours. He does not have any crypto holdings.