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Market Wrap: Finger-Pointing and Job Cuts as Bitcoin Slides Back Toward $20K

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·6 min read
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Don't miss CoinDesk's Consensus 2022, the must-attend crypto & blockchain festival experience of the year in Austin, TX this June 9-12.

Hi, I'm Bradley Keoun, here to take you through the day's crypto market highlights and news.

Bitcoin (BTC) fell for a third straight day, drifting back down toward $20,000 and trading in sync with U.S. stocks.

There was no shortage of drama in the news as the crypto industry continued to address the fallout from the recent carnage in digital-asset markets. The price of BTC is now trading at less than a third of its all-time high around $69,000 late last year.

The CEO of the futures crypto exchange CoinFLEX accused the Bitcoin Cash supporter and noted investor Roger Ver of owing it $47 million in the stablecoin USDC. Ver had tweeted earlier Tuesday that "some rumors have been spreading" that he had defaulted on a debt to a counterparty; instead, he said, the counterparty "owes me a substantial sum of money."

And after a report emerged that the crypto exchange Huobi Global might cut over 30% of its workforce, an official at the rival exchange OKX announced plans for the company to increase its headcount by 30%.

"Over the past two weeks, we have seen the bear markets bringing out the worst," Walter Teng, digital asset strategy associate at the independent investment research firm FundStrat, wrote in a newsletter.

LINK rally fizzles

Arcane Research, the Norwegian analysis firm, totted up a list of dismal indicators and predictions in a weekly report:

  • Prices for bitcoin mining machines "have fallen off a cliff" and are likely to keep falling, which means the miners may eventually have to "dump their orders" in the face of falling cash flows.

  • Bitcoin spot-trading volumes have fallen by 59% over the past nine days.

  • The growing industry woes are "leading to a vicious withdrawal cycle on other centralized lending platforms."

In digital-asset markets beyond bitcoin, the blockchain oracle project Chainlink's LINK rallied as much as 8% earlier after the Robinhood (HOOD) trading platform agreed to list the token. However, later in the day the rally fizzled and LINK was down 2.1%.

In traditional markets, a sell-off in tech led U.S. stocks lower as a key index of consumer confidence dropped to a 16-month low on growing worries over high inflation.

U.S. crude futures rose 2% in New York trading to $111.84 a barrel, and Group of Seven leaders discussed plans for capping oil prices. Gold slid 0.2% to $1,821 an ounce.

Latest prices

Bitcoin (BTC): $20,237 −2.8%

Ether (ETH): $1,157 −3.4%

S&P 500 daily close: 3,821.74 −2.0%

Gold: $1,820 per troy ounce −0.0%

Ten-year Treasury yield daily close: 3.2% +0.01


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.

New York Community Bank to Hold Assets Backing Circle's USDC

By Krisztian Sandor

New York Community Bank, a New York State-based community bank that also has branches in New Jersey, Florida and Ohio, will serve as a custodian for some of the reserve assets behind the USD coin (USDC) stablecoin, Circle, USDC's issuer, said Tuesday.

USDC has distinguished itself from stablecoin competitors by forging closer ties with traditional banks and reportedly being more conservative in the selection of reserves, holding only U.S. dollar-denominated cash and short-term U.S. government bonds. It's the second-largest stablecoin after Tether's USDT, with a circulating supply of $55 billion. USDC has taken market share from USDT since the implosion of the Terra blockchain.

Earlier this spring, Circle announced that BNY Mellon (BK), one of the oldest and largest custodian banks in the U.S., would be the primary custodian for USDC reserves.

NYCB is a relatively small bank, managing $61 billion in assets, according to its website. By comparison, BNY Mellon's assets under custody amounts to $45 trillion.

Read the full story here.

Altcoin roundup

  • Axie Infinity restarts Ronin Bridge: Three months after an exploit saw some $625 million worth of cryptocurrencies stolen from the protocol, Axie Infinity’s Ronin bridge has been restarted. Developers say the bridge has undergone an internal audit and two external audits. Read more here.

  • Shiba inu (SHIB) and dogecoin (DOGE) lead seven-day returns: The two altcoins, SHIB and DOGE, rallied as bitcoin (BTC) and other major cryptocurrencies broke above resistance levels and stabilized over the weekend. Analysts say speculative investor behavior likely led to meme coins outperforming major cryptocurrencies. Read more here.

  • LINK rallies: Chainlink's LINK currency rallied by about 8% Tuesday following its listing on online brokerage platform Robinhood (HOOD). It was the first time Robinhood has listed a new token since mid-April. Read more here.

Relevant insight

Other markets

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

Biggest Gainers

Asset

Ticker

Returns

DACS Sector

Terra

LUNA

+7.9%

Smart Contract Platform

Biggest Losers

Asset

Ticker

Returns

DACS Sector

Shiba Inu

SHIB

−6.7%

Currency

Solana

SOL

−6.3%

Smart Contract Platform

Dogecoin

DOGE

−6.0%

Currency


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.