Market Wrap: Cryptos Decline After Rejection of EU Bitcoin Proposal

Bitcoin (BTC) and other cryptos were unmoved after the rejection of the EU bitcoin proposal on Monday. Traders expect a busy week ahead with the Fed meeting and geopolitical developments on tap.Read MoreFeedzy

Bitcoin (BTC) traded roughly flat over the past 24 hours, although some analysts expect an increase in volatility over the next few days.

On Monday, a proposal that could have required cryptocurrencies like bitcoin to shift to more environmentally friendly mechanisms was rejected in a European Union (EU) parliament committee vote. The proposal was added to a draft of the Markets in Crypto Assets (MiCA) framework last week, which was met with a heavy backlash from crypto advocates worldwide.

There was little market reaction following the EU rejection, although some alternative cryptocurrencies (altcoins) such as dogecoin (DOGE) pared earlier gains. Meanwhile, bitcoin experienced less selling pressure than altcoins on Monday, suggesting lower appetite for risk among crypto traders.

In traditional markets, the S&P 500 extended losses on Monday while gold and oil prices tumbled. Some traders expect the U.S. Federal Reserve to acknowledge soaring energy prices, which could lead to slower economic growth, during the conclusion of their two-day policy meeting on March 15-16.

?Bitcoin (BTC): $38,835, +0.45%

?Ether (ETH): $2,541, -0.20%

?S&P 500 daily close: $4,173, -0.74%

?Gold: $1,955 per troy ounce, -1.41%

?Ten-year Treasury yield daily close: 2.14%

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

Bitcoin’s trading volume across major exchanges declined to its lowest level since Feb. 19 over the past weekend. That could indicate some caution among traders ahead of the Fed meeting this week.

Geopolitical uncertainty also contributed to the recent slowdown in trading activity, which is reflected in blockchain data. So far this year demand among bitcoin holders has flattened, reflecting the “impact of global macro uncertainty on investor sentiment, with weaker BTC accumulation taking place as a result,” Glassnode, a crypto data firm, wrote in a blog post.

Further, the narrow trading range between $35,000 and $40,000 could result in higher volatility over the next two weeks, according to some technical indicators.

Bitcoin trading volumes (CoinDesk, CryptoCompare)

The put/call ratio continued to decline over the past few days, indicating less bearish sentiment among bitcoin options traders. The ratio is currently at the lowest level in a month, albeit still above the Jan. 19 trough.

“Despite the looming interest rate increase expected from the Fed this week, the BTC put/call ratio continues to decline from an early February high,” Fundstrat Global Advisors wrote in a Monday email. “This decline in the overall ratio might indicate that investors are starting to position for longer-term risk.”

Bitcoin put/call ratio (Skew)

Ethereum staking protocol Swell raises $3.75M as locked ETH tops $26B: Ethereum reached a major milestone last week in its highly anticipated transition to proof-of-stake, with 10 million ETH (about $26 billion) now locked in the Ethereum 2.0 staking contract. Against that backdrop, a new staking protocol, Swell, has joined the ranks of projects helping investors get staking rewards for stashing their ether. The team announced Monday a $3.75 million seed round co-led by Framework, IOSG Ventures and Apollo Capital, according to CoinDesk’s Sam Kessler. Read more here.

Dogecoin spikes briefly after Musk says he won’t sell his crypto holdings: Dogecoin (DOGE) briefly jumped as much as 10% during Asian trading hours on Monday after Tesla CEO Elon Musk said in a tweet that he is not selling his crypto holdings, which include DOGE. DOGE erased some gains toward the end of the New York trading day amid a largely flat crypto market. It is now down about 2% over the past 24 hours. Read more here.

Merit Circle and MetalCore: Merit Circle, the DAO focused on profiting through the metaverse and gaming, is partnering with the open-world blockbuster game company MetalCore through buying $1,000,000 worth of in-game assets. Players will need to rely on a multitude of different NFTs to immersively engage with the MetalCore world. In-game items such as war machines, vehicles, land and gear are all available as NFTs which can be traded on the MetalCore marketplace. This is Merit Circle’s effort to engage in play-to-earn games that bridge the quality gap between traditional games and blockchain games. Read more here.

Digital assets in the CoinDesk 20 ended the day lower.

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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