Google Enters The Crypto Fray

Chart of the Day

Over the past few days, the correlation between BTC and U.S. stocks has become too strong to ignore. In the early hours of Thursday, and in tandem with the slumping tech stocks in the equities market, BTC plunged into a corrective territory below the $42k level on the back of a worsening macroeconomic climate amid fears that the U.S. Federal Reserve will aggressively tighten its monetary policy in the months to come. ETH didn't fare much better. Thursday saw the second largest cryptocurrency by market cap extend its decline below the $3,100 support zone, even momentarily breaking the $3,080 support at some point, before bouncing back to its previous range at the $3,100 level where it is currently trading at (as of the time of writing). With such limited upside momentum that ETH can ride on at this juncture, the $3,050 handle will be a key level to watch, as a downward breakout below that level could set off a major correction beyond the $3,000 region for ETH. On the derivatives front, BTC's Futures Annualized Rolling Basis chart reveals an uncanny correlation between BTC's spot price and its rolling basis. This is a pattern that stretches all the way back to July 2021, suggesting that derivative and structured products may have an outsized effect on BTC spot prices, especially in periods when spot volume is weak. On the altcoin front, it seems that the battle for supremacy amongst L1 networks is now largely centered around network developments and user interaction. Cosmos, for one, has been gaining a lot more traction recently due to the impending launch of EVMOS, an Ethereum Virtual Machine Hub, on its network. This will allow for any given EVM-compatible application to integrate into the Cosmos ecosystem, and is a development that many people within the space have been looking forward to.