Bitcoin traded sideways on Thursday as Fed officials speaking during the first day of the central bank’s Economic Symposium were circumspect about an interest rate hike in September. This article originally appeared in Market Wrap, CoinDesk’s daily newsletter diving into what happened in today’s crypto markets.Read MoreCoinDesk
Bitcoin Little Changed as Traders Await Powell Speech
Bitcoin’s price changed little on Thursday, hovering around $21,500 as traders remain focused on Federal Reserve Chair Jerome Powell’s speech at the U.S. central bank’s Economic Symposium, scheduled for Friday.
The largest cryptocurrency by market capitalization started the week at $21,518 and was recently trading at $21,524. But Friday should bring some action.
On the first day of the Fed’s 45th annual symposium in Jackson Hole, Wyoming, officials offered few clues as to whether the bank now prefers a 50 or 75 basis point rate hike, which would be announced in September at the next Federal Open Market Committee (FOMC) meeting.
In an interview with CNBC, Philadelphia Fed President Patrick Harker said that decision depends on the next inflation reading, expected Sept. 13. But he doesn’t think it’s wise to “rush way up” but instead to “go up and sit for a while.”
“I think we have to recognize that a 50 basis point move is still a substantial move, so whether it’s 50 or 75 I can’t say right now. But let’s not think that 50 isn’t a substantial move,” Harker said.
Harker also said he’d like to see rates go up to 3.4% and leave them there for a little while before making another move. However, Kansas City Fed President Esther George said in an interview with Bloomberg that rates may need to go above 4%.
Regarding the Fed’s long-term inflation outlook, St. Louis Federal Reserve President James Bullard told CNBC he thinks markets are mispricing inflation and that price pressure will be sticky for longer than most investors anticipate.
ETH optimism could be short-lived, however, and long-term sentiment could soon turn bearish, according to Rafal Tworkowski, a market analyst at forex trading firm Conotoxia.
“With Ethereum set to become a proof-of-stake blockchain at the beginning of September, the ether tokens might hold firm for a while,” he said. However, the token’s technical chart showed ether sliding below its 50-day moving average, which could point “to the downside,” he added.
?Bitcoin (BTC): $21,582 -0.5%
?Ether (ETH): $1,704 +1.7%
?S&P 500 daily close: 4,199.20 +1.4%
?Gold: $1,771 per troy ounce +1.3%
?Ten-year Treasury yield daily close: 3.03% -0.08
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.
NFT and Metaverse-Related Cryptocurrencies Underperform as Floor Prices Sink
By Jimmy He
Cryptocurrencies related to non-fungible tokens (NFT) and the metaverse underperformed over the past week as sentiment about the NFT market remained sour.
The Flow network’s FLOW token, which can be used to build NFTs and decentralized applications (dapps) such as games on the Web3 platform, slumped 20% during the past seven days. FLOW’s decline was the second largest during that period among 52 cryptocurrencies with a market cap over $1 billion, according to crypto data and analysis firm Messari.
The general crypto market has stalled amid recent investor concerns about inflation, the economy and the pace of U.S. Federal Reserve interest rate hikes. But NFT- and metaverse-related token declines reflect price and profit declines for NFTs that have occurred in recent months.
According to a report from NFT data aggregator NonFungible.com, the amount of U.S. dollars traded in the NFT market dropped 25% in the second quarter from the first three months. NFT resell profit also fell 46% for a total loss of $1.4 billion.
The floor price – the minimum purchase price – of an NFT from Bored Ape Yacht Club (BAYC), the largest NFT collection by market cap, is down over 50% from its high of 153.7 ETH in April 2022 to around 73 ETH. Over the past seven days, the collection’s floor price slumped 5.6%.
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