Market Wrap: Bitcoin and Stocks Rise, Signaling Greater Investor Appetite for Risk

BTC was up 3% over the past 24 hours versus a 6% rise in ETH.

AccessTimeIconFeb 9, 2022 at 9:17 p.m. UTC
Updated May 11, 2023 at 4:59 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Bitcoin and other cryptocurrencies advanced on Wednesday, reversing an earlier pullback. Stocks were also higher, partly due to the decline in Treasury bond yields.

BTC spot trading volume is starting to tick higher, albeit below January highs, according to CoinDesk data. Some analysts prefer to see a sustained rise in trading volume to confirm the recent bounce in crypto prices.

"Prior cycle majors (ETC, XRP, LTC and EOS) and meme coins (DOGE, SHIB) have been significant gainers in the last 24 hours, potentially signaling the market's risk-on appetite," FundStrat, a global advisory firm, wrote in a Wednesday briefing.

Still, futures market data continues to suggest a neutral/bearish bias among traders. That means "markets could remain indecisive about the next momentum-driven move, at least for the short term," FundStrat wrote.

Technical indicators have improved over the past few days, suggesting a strong buying zone between $40,000 and $46,000. Over the long term, however, buying activity could wane until momentum signals turn positive.

Latest prices

Bitcoin (BTC): $44739, +1.07%

Ether (ETH): $3258, +4.37%

S&P 500 daily close: $4587, +1.45%

Gold: $1834 per troy ounce, +0.38%

Ten-year Treasury yield daily close: 1.93%


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 coindesk.com/indices.

In other news, BlackRock, the world’s largest asset manager, is preparing to offer a cryptocurrency trading service to its investor clients, sources say. Clients could include public pension funds, endowments and sovereign wealth funds that currently trade traditional assets through BlackRock's integrated investment management platform.

BlackRock's potential crypto plans could signal rising demand for digital asset trading among large investors.

But regulatory issues remain, which could stall the pace of institutional crypto adoption. On Tuesday, Commodity Futures Trading Commission (CFTC) Chair Rostin Behnam asked the U.S. Congress to provide his agency with an additional $100 million so it can properly oversee crypto markets.

Keep an eye on trading activity

The chart below shows a gradual decrease in the total volume of buy orders filled by takers in BTC perpetual swaps, a type of derivative product in the crypto market, similar to traditional futures.

High values in buy volume indicate short-term buying pressure and high investor attention, according to CryptoQuant, a crypto data firm. Buying volume ticked lower over the past 24 hours and has not kept up with the recent bounce in BTC's spot price, which could indicate caution among derivative traders.

Still, other indicators such as open interest and buy volume versus sell volume have improved over the past week, which typically signals bullish sentiment in the crypto market.

"Limited liquidity may have contributed to the rising bitcoin price as outsized buying orders in thin order books tend to push up prices," Arcane Research wrote in a report this week. Therefore, even if trading volumes rise, there needs to be enough buying power to sustain BTC's price recovery.

Chart shows the total volume of buy orders filled by takers in perpetual swaps. (CryptoQuant)
Chart shows the total volume of buy orders filled by takers in perpetual swaps. (CryptoQuant)

Altcoin roundup

  • Shiba inu enters metaverse with 'Shiba Lands’: Developers behind popular meme coin shiba inu said the protocol would soon offer plots of virtual lands in an upcoming, yet-unnamed metaverse, causing the prices of ecosystem tokens such as SHIB and LEASH to jump as much as 40%, according to Shaurya Malwa. Read more here.
  • Washington Nationals to ‘explore’ Terra’s UST stablecoin: The Washington Nationals baseball team said Wednesday it will “explore” in-stadium payments of Terra’s UST stablecoin as part of a nearly $40 million sponsorship. The thrust of that deal centers on exclusive seating naming rights. For the next five years, the ballpark’s home plate VIP lounge will be called “The Terra Club” and feature crypto branding prominently, according to CoinDesk’s Danny Nelson. Read more here.
  • Solana ecosystem index SOLI launched: Amun, a provider of crypto index products, launched the solana ecosystem index token (SOLI), a single token that tracks Solana ecosystem projects and provides exposure to five highly liquid, Solana-centric assets. The SOLI composition was made based on average market capitalization and decentralized exchange (DEX) liquidity, according to CoinDesk’s Shaurya Malwa. Read more here.

Relevant news

Other markets

Digital assets in the CoinDesk 20 ended the day higher.

Largest gainers:

Asset Ticker Returns Sector
Ethereum Classic ETC +9.4% Smart Contract Platform
XRP XRP +5.0% Currency
Litecoin LTC +4.6% Currency

There were no losers in the CoinDesk 20 on Wednesday.


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.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.

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.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.