Crypto markets continue to show bearish momentum this Thursday as Bitcoin and Ethereum prices slide. BTC broke through the $19k support line, while Ethereum is below $1,300. The past week has been rough for crypto markets as BTC and ETH lost 5% and 7%, respectively. The likely culprit for the declining price is the underperformance of stocks, which are also down this week.
Key Points:
- Cryptocurrency markets continue to show bearish momentum as BTC and ETH fail to hold support.
- Even with the current bear market, BTC is becoming less volatile.
- A new protocol called the Sustainable Bitcoin Protocol will introduce Sustainable Bitcoin Certificates representing sustainably mined BTC.
- Ethereum’s network is becoming deflationary, with more ETH being burned than created.
- While the short-term sentiment for crypto markets is bearish, the decreasing volatility and improvement in tokenomics is hopeful for the long term.
Market Update
While stocks are in the green today and showing slight bullish momentum, we have yet to see cryptocurrencies rebound. This week’s good news is that even with declining prices, Bitcoin is becoming less volatile. Despite the bear market, BTC remains in the $19k range and has seen relatively minor price fluctuations over the past several months.
In other news, according to a report from Yahoo Finance, a sustainable Bitcoin protocol wants to make BTC a climate-positive asset. It’s a known fact that Bitcoin’s proof-of-work blockchain is quite damaging to the environment and requires a massive amount of electricity to run and secure.
To address this environmental problem, the Sustainable Bitcoin Protocol will introduce Sustainable Bitcoin Certificates, or SBCs, which are transferrable assets representing sustainably mined Bitcoin. Users and investors can purchase SBCs and meet their sustainability mandates.
One issue with such a protocol is the potential compromise of the fungibility of Bitcoin since a sustainably mined Bitcoin would technically be worth more than a regular BTC.
Despite some potential drawbacks, sustainable blockchain projects are the future, as we’ve seen with Ethereum’s network merge, making it the largest proof-of-stake network in cryptocurrency.
Speaking of Ethereum, a report from Coindesk highlights that Ether is becoming deflationary for the first time since the merge, with the number of tokens falling by 4,000 over the past week. The deflationary mechanism comes from more ETH being burned by verifying transactions than created.
With the number of ETH burned, a total reduction of 0.13% of the total supply was achieved over the past week, which given the timeframe and scale of deflation, is quite significant. In addition, the rate of new Ethereum created is down 90% since the merge, signaling much healthier tokenomics than before.
Bitcoin and Ethereum Price
Bitcoin is trading at $18,940, down 5.44% this week, with little change in the past 24 hours. The market capitalization for BTC is $362 billion, with a 24-hour trading volume of $37 billion. Ethereum is trading at $1,254, down 7.77% in the past seven days and down 3% in the past 24 hours. ETH’s market capitalization is at $154 billion, with a 24-hour trading volume of $15 billion.
Both Bitcoin’s and Ethereum’s trading volumes are showing significant upsides. BTC’s 24-hour trading volume was up 39%, and Ethereum’s trading volume was up 85% in the past 24 hours.
It seems that after the merge, Ethereum stopped outperforming Bitcoin in the short term, which is quite concerning. However, the long-term sentiment for BTC and ETH remains highly bullish, and we’re likely to see both crypto asset bottom out in the next several weeks/months.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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