First Mover Asia: Bitcoin Post-Fed Rate Hike Fizzles. Will BTC's Recent Low Volatility Last Much Longer?

zkSync Era launched only in February but has more daily active addresses than Arbitrum and Optimism, the two largest scaling solutions by total value locked, underscoring the rising interest in its potential airdrop.

AccessTimeIconJul 26, 2023 at 11:52 p.m. UTC
Updated Jul 27, 2023 at 12:02 a.m. UTC

Good morning. Here’s what’s happening:

Prices: Bitcoin was trading near $29,300, as momentum stalled after a rally in Thursday's (Singapore time) early morning hours.

Insights: ZkSync Era, a zero-knowledge scaling solution for Ethereum, leads layer 2 landscape in daily active addresses. Interest in its potential airdrop appears to be rising.


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S&P 500
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Nikkei 225
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BTC/ETH prices per CoinDesk Indices, as of 7 a.m. ET (11 a.m. UTC)
CoinDesk Market Index (CMI)
1,238 +8.8 0.7%
Bitcoin (BTC)
$29,312 +91.6 0.3%
Ethereum (ETH)
$1,868 +11.7 0.6%
S&P 500
4,566.75 −0.7 0.0%
$1,973 +10.7 0.5%
Nikkei 225
32,668.34 −14.2 0.0%
BTC/ETH prices per CoinDesk Indices, as of 7 a.m. ET (11 a.m. UTC)

A Mini BTC Rally That Stalled Near $29.7K

As Thursday's trading day started in Asia, bitcoin was clinging to some of its small gains following the U.S. central bank's decision to raise the interest rate 25 basis points (bps).

The largest cryptocurrency by market capitalization was recently trading at $29,477, up 0.9% over the past 24 hours, but still well off its high earlier this month of $31,800. BTC briefly dropped below $29,000 on Monday amid fresh concerns about, separately, Binance and the Chinese economy, but has been largely rangebound between $29,000 and $32,000 since mid June.

In an email to CoinDesk, Stéphane W Ouellette, the CEO of crypto advisory platform FRNT Financial, noted the recent stunted volatility rates, including some BTC readings that have fallen below U.S. stock indices levels. "Implied volatility rates on options platforms such as Deribit are at or near all-time lows," Ouellette wrote."

But he added: "This type of environment historically has not persisted for long. Our data analysis suggests that some of the most significant volatility spikes have emerged out of such environments and historically, in albeit relatively short history of BTC, resolves more often than not in a directional move to the upside."

Ether was recently changing hands at $1,873, also up about 0.8%. Most other cryptos were in positive territory with OGN, the token of the DeFi and NFT platform Origin Protocol, up more than 15% and SOL, the native crypto of smart contracts platform Solana, rising more than 9%. After rising by double-digits on Wednesday (Singapore time) popular meme coin DOGE retrenched by nearly 4%.

Following the rate hike, Fed Chair Jerome Powell reiterated the bank's openness to raising interest rates again. In an email, Oliver Rust, head of product at inflation aggregator Truflation, wrote that this would be unwelcome news to markets, and also small and medium businesses that are struggling to access capital."

Biggest Gainers

Asset Ticker Returns DACS Sector
Gala GALA +9.2% Entertainment
Solana SOL +8.7% Smart Contract Platform
XRP XRP +7.6% Currency

Biggest Losers

Asset Ticker Returns DACS Sector
Dogecoin DOGE −16.5% Currency
Stellar XLM −12.4% Smart Contract Platform
Chainlink LINK −7.3% Computing


ZkSync Era's lead in daily active addresses is fueled by speculation about a potential airdrop.


ZkSync Era, a zero-knowledge (ZK) scaling solution for Ethereum, currently leads the layer 2 landscape in daily active addresses, continuing its year-to-date growth.

According to blockchain analytics firm, zkSync Era has grown more than 60% to roughly 305,000 daily active users from about 189,000 since the beginning of July, outpacing all other layer 2’s, except Polygon zkEVM which has grown 331% to more than 34,000 daily active users in the same period.

Despite recently launching only in February, zkSync Era has more daily active addresses than Arbitrum and Optimism, the two largest scaling solutions by total value locked, underscoring the rising interest in a potential airdrop from zkSync Era.

“A significant part of usage [on zkSync Era] is likely related to airdrop farming activity,” wrote Artemis Chief Operating Officer Jimmy Zheng to CoinDesk on Telegram. Matter Labs, the company behind zkSync Era, “has raised a meaningful amount of funding for the project and there’s huge speculation that there will be a potential airdrop to facilitate ecosystem growth,” Zheng noted.

Matter Labs hasn’t revealed any plans for token airdrop, and yet, the rise of daily active addresses for zkSync Era demonstrates how a potential airdrop can drive on-chain activity.

“ZkSync Era has benefited from the airdrop narrative. This has fuelled users bridging value [and] using applications in anticipation of a future token,” said Charles Storry, head of growth at Phuture, a crypto index platform.

Important events.

CoinDesk TV

In case you missed it, here is the most recent episode of "First Mover" on CoinDesk TV:

Senators Cynthia Lummis and Kirsten Gillibrand recently unveiled a new version of their bipartisan crypto bill, which could define more of the conversation around digital asset legislation. Sen. Lummis joined "First Mover" to discuss. Maple head of growth and capital markets Quinn Thompson shared his outlook on the crypto markets ahead of a key Fed decision on interest rates. And, mining analyst Anthony Power explained how miners are preparing for the next bitcoin halving.


Federal Reserve Hikes Fed Funds Rate by 25 Basis Points: The move was fully anticipated by market participants who will now look to Chairman Jerome Powell’s imminent post-meeting press conference for clues about whether the central bank intends to continue tightening monetary policy.

Once a Pioneer, Cosmos Blockchain Project Faces 'Existential' Crisis: After the collapse of Terra, and with new competition on Ethereum, a network built for interoperability is at risk of becoming obsolete.

Bitcoin Miners Buy Up Rigs as Prices Near All-Time Lows: Miners are prioritizing the inclusion of next-generation mining rigs in their operations to prepare for the next Bitcoin halving.

DeFi Daily Volume Dwindles to 7-Month Lows as Sector Endures Downswing: Sunday marked the lowest daily volume across DeFi since the turn of the year.

U.S. Justice Department Wants to Jail Sam Bankman-Fried: A prosecutor said that "no set of release conditions can secure the safety of the community."

Edited by James Rubin.


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James Rubin

James Rubin was CoinDesk's U.S. news editor based on the West Coast.

Sage D. Young

Sage D. Young was a tech protocol reporter at CoinDesk. He owns a few NFTs, gold and silver, as well as BTC, ETH, LINK, AAVE, ARB, PEOPLE, DOGE, OS, and HTR.