Welcome to Around the Blockchain, Huobi Learn’s daily rundown of the crypto markets.
Jeremy Siegel, a finance professor the University of Pennsylvania’s Wharton School, has warned of “Bitcoin taking over”, adding that the US Federal Reserve has been “terribly wrong over the last year” about inflation and must act immediately to defend the US dollar. He had previously noted the rise in Bitcoin’s popularity and said it had replaced gold as an inflation hedge for millennials. Now, he feels that in view of increasing inflation, the Fed must “hike many more times than what the market expects”, and that it would be a “big policy mistake” for it to hold off in light of the Russia-Ukraine conflict.
Binance CEO Zhao Changpeng and Coinbase CEO Brian Armstrong are the latest crypto personalities to dismiss concerns that Russia will use crypto to evade sanctions. Zhao said that with only 3% of the world’s population owning crypto and likely under 0.3% of global net worth in crypto, it was “too small for Russia” to use to circumvent sanctions. He added that crypto was “too traceable” and even privacy-focused crypto like monero would not work as XMR’s market cap is $3 billion — a fraction of Russia’s $1.5 trillion GDP. Similarly, Armstrong said that due to open ledgers, “trying to sneak lots of money through crypto” was “more traceable than using USD cash, art, gold or other assets”.
Even as crypto has become increasingly mainstream, some financial advisors and wealth managers seem to have trouble adapting. A eMoney Advisor survey found that around 43% of US respondents had invested in crypto but under half were receiving digital token advice, while a Bitwise survey of advisors found that despite 94% of respondents having gotten crypto-related queries from clients, only 15% allocated money to digital tokens. This could be due to crypto’s volatility, as well as a lack of a BTC exchange traded fund (ETF) tied specifically to its spot price — some advisors, like Financial Guidance Group’s Nashville manager Carl von dem Bussche, “want to see” an SEC-approved spot BTC ETF before they “make anything happen”. Others, like Edelman Financial Services founder Ric Edelman thinks advisors should allocate 1% to 3% of their client portfolios to crypto-linked assets, as not taking this opportunity could negatively affect client returns.
Show me the money
According to data from Huobi Global, BTC fell slightly today to around 37,800 while ETH fell to around 2,600, with daily charts for both showing signs of a down-trend. Contracts-wise, Huobi Futures data showed stable open interest (OI) in both BTC and ETH futures, with stable volume amid a relatively inactive contract market.
Renewed selling pressure has pushed ADA’s price down by 18.3%, retesting the lower support level of $0.82. A breakdown below this level may place the altcoin in danger of a further dip of 17.6% to $0.678. On the other hand, a bullish reversal from the $0.86 mark would indicate an accumulation of traders at this dip and would push the price up to $1. Still, ADA would need to break out from the falling wedge pattern and sustain this trajectory in order to see genuine recovery.
Polkadot’s price analysis remains bearish today, with a dip of nearly 2% pushing the price down to a 24-hour low of $16.59. The price could fall to as low as $15 in the next 24 hours if the support barrier does not hold. At the same time, DOT’s trading volume saw a 24% dip, with the number of transactions falling by 10% in line with the bearish trend. The wider crypto market also remained bearish, with BTC’s dip below $38,000 and ETH’s decline to $2,600. XRP, ADA and DOGE fell by 2%, while SOL and LUNA saw a 4% decrease. The only positive movement was observed by NEAR coin, increasing by 4% to $10.79.