Bitcoin News

First Mover Asia: Bitcoin Retreats Further Into the Gloom

On Wednesday, Bitcoin added more gloom to an already bleak year.

The largest cryptocurrency by market capitalization is currently trading just above $16,500, down a percentage point in the last 24 hours. Since mid-December, BTC has been clinging to $17,000 amid market concerns about the latest macroeconomic uncertainties and the increased likelihood of the US central bank adding to its recent diet of interest rate hikes.

Brent Xu, founder and CEO of cross-chain DeFi hub Umee, told CoinDesk TV’s First Mover program that markets appear destined to remain negative well into 2023. “Markets will bottom out around Q2 to Q3,” Xu predicted. “We’ll have another six to twelve months of negative sentiment, possibly 18 months.”

Nonetheless, he added that he anticipates “better developments” in the long run.

Ether was recently trading just under $1,200 for the second day in a row, down more than 2% from Tuesday at the same time. Other major cryptos by market cap were mostly in the red, as is typical for most assets as the year comes to a close. SOL, the Solana blockchain token, and APT, the Aptos blockchain system’s native cryptocurrency, were down more than 11% and 10%, respectively. The CoinDesk Market Index (CDI), a cryptocurrency performance index, recently fell 1.86%.

US equity indexes fell slightly as investors pondered the ramifications of China reopening its borders after months of Covid closure. The Nasdaq and S&P 500, both of which have a significant technology component, fell 1.4% and 1.2%, respectively. Stocks typically trade sideways at this time of year, but a massive sell-off in Tesla stock this month and mass cancellations on Southwest Airlines may change that trend.

For at least one day, a couple of marginally positive stories replaced the latest developments in the ongoing crisis at crypto exchange FTX in industry headlines. Argo Blockchain (ARBK) avoided bankruptcy by agreeing to sell its Dickens Country, Texas mining facility to Galaxy Digital for $65 million and securing a $35 million loan from the crypto-focused financial services firm.

CoinDesk reported earlier in the day (Hong Kong time) that MicroStrategy (MSTR), the business software vendor co-founded by crypto proponent Michael Saylor, has added to its bitcoin (BTC) stockpile, purchasing approximately 2,395 bitcoins for $42.8 million between Nov. 1 and Dec. 21 through its MacroStrategy subsidiary Umee’s. According to Xu, the recent improvement in macroeconomic conditions and crypto price stability has made options trading difficult. “Not a lot of volatility if you’re an options trader,” Xu said. “Whenever there’s any price movements, they’re not going to be sustained long enough form some notable trend.

“It’s just not the best time to invest in crypto assets,” he added.


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