Market Wrap: Cryptos Are Higher After a Volatile Week

Some analysts remain cautious and expect lower price returns for bitcoin over the next few months.

AccessTimeIconMay 13, 2022 at 8:34 p.m. UTC
Updated May 11, 2023 at 4:55 p.m. UTC
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Most cryptocurrencies traded higher on Friday as bearish sentiment waned. It appears that short-term buyers have returned from the sidelines, although technical indicators show limited upside from here.

Bitcoin (BTC) returned toward the $30,000 price level and was up by as much as 5% over the past 24 hours. Still, momentum signals remain negative on the charts after BTC's 17% dip over the past week.

For now, cryptos and stocks are experiencing a relief bounce, which could last for a few more days. Alternative cryptos (altcoins) outperformed on Friday, which reflects a greater appetite for risk among traders. For example, ICP, MANA and DOGE rallied by more than 20% over the past 24 hours.

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Meanwhile, the Terra blockchain resumed activity on Friday following a nine-hour halt. The LUNA token continued to trade below 1 cent at the time the network was halted.

Also, on Friday, the Grayscale Bitcoin Trust's (GBTC) discount widened to an all-time low of 30.79%. The recent crypto sell-off also may have contributed to a wider GBTC discount. (Grayscale is a CoinDesk sister company.)

Latest prices

Bitcoin (BTC): $29,980, +5.17%

Ether (ETH): $2,057, +6.60%

S&P 500 daily close: $4,024, +2.39%

Gold: $1,808 per troy ounce, −0.88%

Ten-year Treasury yield daily close: 2.94%

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

Crypto outflows

Fewer crypto traders sought refuge in stablecoins during the recent market sell-off. That suggests investors are starting to exit crypto markets.

The chart below, provided by Glassnode, shows the 30-day change in aggregate stablecoin supply (blue) alongside the contribution by stablecoin USDC (red). Since last May, USDC has been a significant contributor to total stablecoin supply growth. Recently, however, USDC has been the primary stablecoin asset experiencing redemption.

Stablecoin supply contraction signals a degree of net capital outflow from the cryptocurrency industry at large, according to Glassnode. "Overall, there are a number of signals of net weakness in the space, many of which indicate that risk-off sentiment remains the core market position at this time," Glassnode wrote in a blog post.

Screen Shot 2022-05-13 at 2.52.30 PM.png

Interestingly, Tether's USDT has seen its supply continue to expand over the same period of USDC outflows. But since the start of April the aggregate stablecoin supply has plateaued.

It remains to be seen if trust in stablecoins will return following Terra's faulty experiment using algorithms. Some stablecoin issuers have assured market participants that not all stablecoins are the same (some are backed by cash-like instruments, while others try to maintain their value based on an algorithm that balances the stablecoin with a partner token). But recent episodes have exposed instability in the so-called stable corner of the crypto universe.

Limited upside ahead

For now, cryptos could face additional volatility ahead, which could keep some buyers on the sidelines (in stablecoins or cash).

Despite the recent price bounce, bitcoin's forward returns following a peak-to-trough decline of 55% or more tend to be flat or negative over the following six months, according to Delphi Digital.

Screen Shot 2022-05-13 at 2.52.05 PM.png

Altcoin roundup

  • LUNA exchange-traded product issuances halted: VanEck, Valour and 21Shares, all of which offer LUNA-related exchanged-traded products (ETP) in Europe, suspended issuing shares, citing the network’s recent issues, which include two complete shutdowns of the purportedly decentralized network. All three products lost close to 100% this week. Read more here.
  • Do Kwon’s Terra revival plan: A “Revival Plan” was submitted Friday by the Terraform Labs CEO. It's essentially a restart of the entire Terra blockchain, with network ownership getting distributed entirely to UST and LUNA holders through one billion new tokens. The plan comes as Terra’s terraUSD (UST) stablecoin, which is supposed to be pegged to the price of $1, “death spiraled” below 15 cents this week – wiping out over $30 billion in value. Read more here.
  • ADA price jump: Cardano’s ADA token jumped as much as 40% over the past 24 hours, leading gains among the biggest cryptocurrencies. The cryptocurrency is still down by 82% from its all-time high of $3.10, achieved in September of last year. Some analysts have attributed recent gains to a short-squeeze rally, which occurs when a large number of short sellers exit their positions.

Relevant insight

Other markets

Most digital assets in the CoinDesk 20 ended the day higher.

Biggest Gainers

Asset Ticker Returns DACS Sector
Internet Computer ICP +23.0% Computing
Polkadot DOT +21.6% Smart Contract Platform
Solana SOL +14.3% Smart Contract Platform

Biggest Losers

There are no losers in CoinDesk 20 today.

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.

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