Bitcoin fluctuates at US$30,000; Ether gains; Litecoin, XRP drop; U.S. equities fall on recession concern

Bitcoin dipped but held above US$30,000 in Thursday morning trading in Asia that saw mixed performances among the top 10 non-stablecoin cryptocurrencies. Ethereum gained following the blockchain’s network upgrade on Wednesday, seemingly shrugging off concerns the upgrade could bring selling pressure on the Ether token. Solana continued to lead the winners as investors anticipate its first smartphone launch on Thursday. U.S. equities dropped on Wednesday after Federal Reserve minutes from March showed officials projecting a recession in the second half of 2023, while the U.S. consumer price index (CPI) in March indicated cooling but stubborn inflation.

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Fast facts

• Bitcoin dropped 0.76% to US$30,008 in the 24 hours to 09:00 a.m. in Hong Kong, but held a weekly gain of 7.26%, according to CoinMarketCap data. The world’s largest cryptocurrency has jumped over 80% since the start of the year.
• Bitcoin buyers ignored renewed criticism from U.S. investor Warren Buffet in a CNBC interview on Wednesday, where he called the cryptocurrency a “gambling token” without intrinsic value. 
• Ethereum gained 1.10% to US$1,910, adding 0.79% for the week. The Shanghai upgrade of the Ethereum blockchain activated on Wednesday and allows investors to withdraw their staked Ether for the first time. Some analysts expect the upgrade may trigger a withdrawal of nearly US$2.3 billion worth of Ether, about 6% of the total value of staked Ether, according to a Wednesday Bloomberg report. 
• Litecoin led the losers in the top 10, dropping 2.45% to trade at US$92.23. The token is flat for the seven-day period.
• XRP fell 2.06% to US$0.5041, but is still up 1.08% for the week. The U.S. Securities and Exchange Commission (SEC) filed a letter on Tuesday to support its case against Ripple Labs, which it has accused of offering unregistered securities in the form of XRP. The letter quoted the SEC’s case against investment adviser Commonwealth Equity Services, which involved violation of securities laws and saw the defendant’s fair notice argument rejected by the court.
• Solana rose 2.49% to US$24.01, up 15.51% for the week. Solana Mobile, a subsidiary of Solana Labs, will release its first smartphone Saga on Thursday, which integrates the Solana blockchain and allows users to make on-chain transactions, manage digital assets, and access a variety of decentralized apps.
• The total crypto market capitalization dipped 0.52% in the past 24 hours to US$1.23 trillion. The total trading volume over the last 24 hours rose 13.33% to US$48.60 billion.
• In the non-fungible token (NFT) market, the Forkast 500 NFT index edged up 0.32% to 3,992.64 in the 24 hours to 09:00 a.m. in Hong Kong, but was still down 0.48% for the week. The index is a proxy measure of the performance of the global NFT market and includes 500 eligible smart contracts on any given day. It is managed by  CryptoSlam, a sister company of Forkast.News under the Forkast.Labs umbrella.
• U.S. equities closed lower on Wednesday after minutes of the Fed’s meeting in March resurfaced concerns about a recession, while Buffet in the same CNBC interview warned the U.S. banking system could face further stresses after the recent failures of a trio of lenders. The Dow Jones Industrial Average dipped 0.11%, the S&P 500 moved 0.41% lower, and the Nasdaq Composite Index dropped 0.85%. 
• At the meeting on March 21 and 22, the Federal Reserve raised interest rates by 25 basis points and Fed officials projected the U.S. economy could enter a “mild recession” later this year. Several Fed officials considered leaving interest rates unchanged, noting the bank failures, but decided on the rate hike due to “elevated inflation.”
• U.S. gross domestic product is expected to rise 2.9% in the second quarter of 2023, but to drop by 0.3% in the third quarter and 0.1% in the fourth, according to data from Trading Economics.
• U.S. CPI released Wednesday rose 5% on year in March, down from 6% in February, and the smallest increase since May 2021. The number was lower than economists’ expectation of 5.2% and pointed to a slowing of inflation, but is still well above the Fed’s target rate of around 2%, Reuters reported on Thursday. Core CPI – excluding food and energy – moved up 5.6% on year, accelerating from February.
• U.S. interest rates are currently between 4.75% to 5%, the highest since June 2006. Analysts at the CME Group expect a 29.6% chance the Fed will not raise interest rates at its next meeting on May 3, while 70.4% predict a 25-basis-point rate hike, up from 66.9% on Wednesday. 
• U.S. stock futures traded flat to lower as of 9:00 a.m. in Hong Kong. The Dow Jones Industrial Average dropped 0.12%. The S&P 500 futures dipped 0.10%. The Nasdaq Composite Index inched 0.02% lower.

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