Bitcoin continued trading above US$30,000 in Wednesday morning trading in Asia, while most other top 10 non-stablecoin cryptocurrencies moved higher. Ethereum dipped ahead of the Shanghai hard fork as some investors expect massive withdrawals of staked Ether as Solana led the winners ahead of its first smartphone launch on Thursday. U.S. equities closed mixed on Tuesday as investors wait for the U.S. consumer price index (CPI) in March, which will provide insight into inflation and the Federal Reserve’s next move on interest rates.
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Fast facts
- Bitcoin moved up 1.33% in the 24 hours to US$30,256 at 09:00 a.m. in Hong Kong, holding a weekly gain of 5.51%, according to CoinMarketCap data. The world’s largest cryptocurrency breached the US$30,000 mark on Tuesday and reached US$30,509 early Wednesday, the highest price since June 2022. Investors bet the U.S. CPI data on Wednesday would allow the Fed to revise its monetary tightening policies, which can hint that the end of rate hikes is around the corner, according to a Reuters report on Wednesday.
- Ethereum dipped 1.37% to US$1,890, trading 1.23% lower for the week. The Shanghai hard fork of the Ethereum blockchain, also known as the Shapella upgrade, will come on Wednesday (Thursday morning in Hong Kong). The hard fork includes an upgrade that allows investors to withdraw their staked Ether for the first time.
- Solana jumped 11.98% to US$23.44 and added 9.95% for the week. Solana Mobile, a subsidiary of Solana Labs, is set to release its first smartphone Saga on Thursday, which has integrated the Solana blockchain, allowing users to make on-chain transactions, manage digital assets, and access a variety of decentralized apps.
- The total crypto market capitalization rose 0.70% in the past 24 hours to US$1.24 trillion. The total trading volume over the last 24 hours moved up 5.10% to US$43.63 billion.
- In the non-fungible token (NFT) market, the Forkast 500 NFT index rose 1.27% to 3992.14 in the 24 hours to 09:00 a.m. in Hong Kong, but was still down 1.04% 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 Forkast Labs data branch, CryptoSlam.
- U.S. equities closed mixed on Tuesday as investors waited for the U.S. March CPI on Wednesday. The Dow Jones Industrial Average added 0.29%, the S&P 500 changed little, and the Nasdaq Composite Index dropped 0.43%.
- Analysts expect the U.S. CPI rose 5.1% by year in March, down from 6% in February but still well above the Fed’s goal to curb inflation below 2%, according to Bloomberg on Wednesday. Some investors are no longer eyeing the possibility of another 25-basis-point rate hike in the U.S. in May, but for indicators of lower rates in the second half of 2023, according to a Reuters report on Wednesday.
- The U.S. employment situation summary released last Friday showed a mixed picture. While the employment rate dropped to 3.5% in March, lower than the 3.6% forecast by analysts, employers only added 236,000 nonfarm payrolls, the smallest increase since December 2020, indicating a slowdown in the economy.
- With the mixed information, analysts at the CME Group expect a 33.1% chance the Fed will not raise interest rates at its next meeting on May 3, while 66.9% predict a 25-basis-point rate hike, down from 71.3% on Tuesday. U.S. interest rates are currently between 4.75% to 5%, the highest since June 2006.
- U.S. stock futures edged higher as of 9:00 a.m. in Hong Kong. The Dow Jones Industrial Average added 0.06%. The S&P 500 futures edged up 0.05%. The Nasdaq Composite Index gained 0.06% higher.
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