First Mover Americas: Bitcoin Hanging Tough as Stocks Slide

  • Prices Point: Bitcoin slid on Friday after gaining 5.1% on Thursday, but overall, the cryptocurrency has been resilient under tough market conditions.
  • Market Move: Ethereum miners have $319 million in ether that they theoretically could start dumping, which would weigh on the price.
  • Chart of the Day: The discount between the price of liquid-staking protocol Lido's staked ether (stETH) and the price of ether (ETH) has pretty much evaporated, according to data source Dune Analytics.

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Price Point

Bitcoin (BTC) was sliding after a surprisingly strong performance on Thursday – a 5.1% gain that was the largest cryptocurrency’s best single-day return in two weeks.

“Bitcoin continues to display strong resilience in the face of a broader risk-averse mood in financial markets,” Craig Erlam, senior market analyst at the foreign-exchange brokerage Oanda, wrote in an investor update. “Given it is the ultimate risk asset, this is quite surprising and perhaps even encouraging.”

Traditional markets were reeling Friday from signs that there’s no easy fix for the global economic challenges, with activity slowing or possibly even contracting, inflation still persistent and central bankers ratcheting monetary conditions tighter.

The U.K. pound tumbled as the government announced a plan to stimulate the economy through tax cuts – prompting fresh inflation warnings from economists and leading traders to bet on faster interest-rate hikes by the Bank of England.

The dollar surged to a new record valuation in foreign-exchange markets, which is likely seen as a negative for bitcoin, because the cryptocurrency often trades in an inverse relationship to the greenback. As of press time, bitcoin was changing hands around $18,900.

The CoinDesk Market Index was roughly flat over the past 24 hours.

Arthur Hayes, former CEO of crypto exchange BitMEX, wrote in his latest blog post that he thinks ether (ETH), the second-largest cryptocurrency, will outperform bitcoin following last week’s successful completion of the Ethereum blockchain’s Merge: “The price of ETH continues to get smoked due to deteriorating USD liquidity, but give the changes in the supply and demand dynamics time to percolate. Check back in a few months, and I suspect you’ll see that the dramatic reduction in supply has created a strong and rising floor on the price.”

CoinDesk Market Index

Biggest Gainers

Asset Ticker Returns DACS Sector
Cronos CRO +10.77% Currency
Ribbon Finance RBN +4.38% DeFi
Alchemy Pay ACH +3.84% Currency

Biggest Losers

Asset Ticker Returns DACS Sector
Terra Luna Classic LUNA -7.51% Smart Contract Platform
ApeCoin APE -5.81% Culture & Entertainment
Celsius CEL -4.91% Currency

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 Market Index (CMI) is a broad-based index designed to measure the market capitalization weighted performance of the digital asset market subject to minimum trading and exchange eligibility requirements.

Market Moves

Ethereum Miners’ $319M Crypto Hoard Hangs Over Market After Merge

By Jocelyn Yang

In the years and months leading up to the Ethereum blockchain’s historic shift last week to a more energy-efficient system, data miners working for rewards on the network had accumulated nearly $341 million worth of the cryptocurrency ether (ETH).

Now, a week after the Merge, crypto analysts are warning that miners’ sales of their hoards could become a source of near-term, downward pressure on the cryptocurrency's price, with the market already sinking by 19% in the past month.

“Miners dumping their ETH is an overhang that we’ll have to get through over the coming months in order to resume up-only mode, but it will happen,” Lucas Campbell, editor of the Bankless newsletter, wrote Monday.

Ethereum miners dumped more than 16,000 ETH from Sept. 12 to Sept. 19. (The Merge took effect on Sept. 15.) The decline reduced the miners’ combined balance to about 245,000 ETH, or about $319 million worth.

Read the full story here.

Chart of the Day

Lido's stETH Trades Almost at Par With Ether

By Omkar Godbole

The chart shows Lido's stETH catching up ether's price (Source: Dune Analytics)
  • The discount between the price of liquid-staking protocol Lido's staked ether (stETH) and the price of ether (ETH) has pretty much evaporated, according to data source Dune Analytics.
  • Investors have piled into stETH since the Ethereum blockchain switched to proof-of-stake technology on Sept. 15.
  • According to Nansen, the so-called "smart money" has poured $33 million into the stETH token in seven days.
  • The token came under pressure early this month as some investors switched to ether to collect a potential Ethereum fork token ETHPoW.