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On Sunday, the weekend recovery momentum that was kickstarted last Friday night (Asian trading hours) was abruptly halted right after BTC inched up to touch the $43k handle. Unfortunately, this short-lived weekend rally did not manage to break BTC out of its tight trading range, and the gains made can be understood to be pretty insignificant, especially when compared to the movements that followed. During the early Asian trading hours on Monday, BTC started a fresh decline to trade below its former key support near the $42.5k level, and is now consolidating losses near the $42k region (as of the time of writing). Further, the bearish descending channel formed on the hourly chart implies that this downside correction could extend to the $40k level should the support region near $41.2k buckle under pressure. In a similar vein, ETH is currently (as of the time of writing) trading well below the $2,900 level, whilst the token performances of most major altcoins have also been hampered by minor setbacks over the past few days. On top of the growing geopolitical tensions and rising inflationary concerns, another big story that may have impacted the crypto market in a profound way was the U.S. Justice Department's seizure of a whopping $4 billion worth of BTC that was purloined from the 2016 Bitfinex hack. This constitutes the biggest token seizure of all time, and has significantly improved the U.S. government's standing as a major “BTC holder”, placing them right behind institutions like Grayscale and MicroStrategy. Meanwhile, Bitfinex's LEO token, one that has been consistently flying under the radar ever since its launch in 2019, has also surged to an all-time high after the DOJ's seizure.
Trading activities in the futures market have remained light in the past week, with perpetual contract trading volumes across major exchanges plunging to a multi-month low. Meanwhile, the futures open interest on all exchanges has also begun to unwind, as it has dropped by around 30k BTC since early January of this year. This indicates that some leveraged traders may have temporarily exited the market due to the murky macroeconomic conditions, but also that spot demand has increased.
CryptoPunks are a NFT collection that predates the current NFT hype by a few years, and are considered to be a legendary collection in the eyes of many NFT enthusiasts. Before the past weekend, the most expensive Punk ever to have been sold (at a Sotheby's auction in June 2021) was worth a sizeable $11.8 million. This figure has just been shattered though, as Deepak Thapliyal, the CEO of cloud infrastructure firm Chain has just purchased an Alien Punk for a whopping $23.7 million (at the time of sale). Thapliyal announced in a tweet that he leveraged up via Compound Finance to pay for the NFT, and that he "basically long'd ETH to punk-in".