Market Wrap: Cryptocurrencies Pull Back in Light Trading

"We aren't out of the woods yet," one analyst said; meanwhile, ETH is starting to underperform BTC.

AccessTimeIconFeb 8, 2022 at 9:36 p.m. UTC
Updated May 11, 2023 at 3:40 p.m. UTC
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Most cryptocurrencies traded lower on Tuesday, a reminder that the surge earlier this week may be temporary.

There were reminders of other weaknesses in the crypto markets when the U.S. Department of Justice announced that it has seized $3.6 billion worth of BTC tied to the 2016 hack of Bitfinex, a large crypto exchange registered in the British Virgin Islands.

The hack resulted in 120,000 stolen BTC, worth around $60 million at the time of the theft. A married couple was arrested in New York on Tuesday on charges they conspired to launder proceeds from the hack.

Bitfinex said it will repay investors in its UNUS SED LEO token, which quickly rallied as much as 50% against the U.S. dollar in just one hour after the news broke. CoinDesk's Nikhilesh De and Danny Nelson reported on the event here.

Meanwhile, bitcoin and ether each declined 3% in the past 24 hours, compared with a 7% dip in Solana's SOL token over the same period. XRP stood out with a 3% gain on Tuesday.

Despite improving sentiment among traders, some analysts expect choppy price action over the short term.

"Trading volume has been light. So far, BTC has held up the $30K-$40k support level that we witnessed last year but we aren't out of the woods yet," Martha Reyes, head of research at Bequant, a digital asset brokerage platform and exchange, stated in an email to CoinDesk.

"And when it comes to macro risks, especially as volume has been light in equities, with high volatility, some cracks are beginning to show in high-yield credit," Reyes added.

Latest prices

Bitcoin (BTC): $44001, −0.45%

Ether (ETH): $3108, −1.51%

S&P 500 daily close: $4522, +0.84%

Gold: $1828 per troy ounce, +0.40%

Ten-year Treasury yield daily close: 1.95%

Bitcoin, ether and gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the COMEX spot price. Information about CoinDesk Indices can be found at

Sentiment improves

The bitcoin Fear & Greed Index exited "extreme fear" territory last week and it now signals improving sentiment.

"After spending almost three months in a state of fear and misery, the more comfortable 'Greed' area should be highly welcomed by tired [bitcoin traders]," Arcane Research wrote in a Tuesday report.

The last time the index rose from extreme lows was in July, which preceded a price rally. This time, however, the rise in BTC occurred on low trading volume, which indicates weak buying power. That could point to a short-term pullback or range-bound price action, especially as regulatory and macroeconomic headwinds remain.

"Towards the downside, $40,000 is the most important support level to pay attention to in the coming days," Arcane wrote.

Bitcoin Fear & Greed Index (Arcane Research)
Bitcoin Fear & Greed Index (Arcane Research)

Bitcoin rises versus ether

The chart below shows the recent pullback in ether relative to bitcoin, or the ETH/BTC price ratio. Over the past week, during the crypto rally, ETH's return has trailed BTC by about 1%. Despite the small return gap, technical breakdowns in ETH/BTC suggest relative weakness could persist over the short term.

The ETH/BTC ratio (Damanick Dantes/CoinDesk, TradingView)
The ETH/BTC ratio (Damanick Dantes/CoinDesk, TradingView)

Altcoin roundup

  • NFT trading card game Skyweaver launched Open Beta: The blockchain-based trading card game Skyweaver announced on Tuesday the launch of its Open Beta game after months of private access-only gameplay that followed three years of development. The team is now focused on achieving crossover appeal to players who may be interested in the game and its mechanics but are unfamiliar with blockchain technology. Read more here.
  • Axie Infinity reduces SLP emissions: In the Axie Infinity video game, players earn "smooth love potion" (SLP) tokens as rewards, which can then be redeemed for in-game features. Unlike AXS – a governance token that allows holders to participate in decisions for Axie Infinity’s future – SLP has an uncapped token supply, meaning there is no limit to how many SLP tokens could exist in the future. Axie Infinity has now introduced important changes to the rewards system, reducing the daily SLP token supply by 56%, endeavoring to make it a more sustainable product for users. Read more here.
  • Alfa Romeo’s NFTs record vehicle data: Italian luxury car maker Alfa Romeo has revealed it will be using non-fungible tokens (NFTs) to track and store maintenance records on the blockchain for its new Tonal SUV. The carmaker appears to be the first to use NFTs in this way, seemingly in a bid to bring transparency and efficiency to a car market that often relies on third parties to track car records, according to CoinDesk's Eli Tan. Read more here.

Relevant news

Other markets

Digital assets in the CoinDesk 20 ended the day lower.

Largest gainers:

Asset Ticker Returns Sector
XRP XRP +5.1% Currency
Stellar XLM +1.3% Smart Contract Platform

Largest Losers:

Asset Ticker Returns Sector
Dogecoin DOGE −7.1% Currency
Polygon MATIC −6.3% Smart Contract Platform
Algorand ALGO −5.3% Smart Contract Platform

Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive, and standardized classification system for digital assets. The CoinDesk 20 is a ranking of the largest digital assets by volume on trusted exchanges.


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Damanick Dantes

Damanick was a crypto market analyst at CoinDesk where he wrote the daily Market Wrap and provided technical analysis. He is a Chartered Market Technician designation holder and member of the CMT Association. Damanick is also a portfolio strategist and does not invest in digital assets.

Angelique Chen

Angelique is a market contributor at CoinDesk.

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