Bitcoin (BTC) went down, up and down again. Bitcoin investors’ profits continue to rise amid the high volatility and the growing economic crisis. Experts are wary of algorithmic financial products, hackers hunt for personal data, and average citizens gamble to make money. CoinsPaid Media has prepared for you a selection of the most important news that happened from April 16 to 22.
Bitcoin (BTC): High Volatility
Over the last seven days, Bitcoin has fallen below $39,000 and came close to $43,000 but eventually returned to almost the same figures observed last Friday. On April 22, the first cryptocurrency quotes were around $40,700.
The major negative news factors affecting the BTC exchange rate this week were higher inflationary pressures in the US, which increased the likelihood of the Fed’s rate hike by 50 basis points at the next meeting.
Risk assets also suffered a blow from the pandemic news. Shanghai has been in a quarantine zone for the third week — about 25 million people are isolated, shipping has been hit hard, also affecting the markets. In addition, the WHO has warned of a threat of a new strain of COVID-19 — XE.
BTC & Nasdaq Correlation
Analysts at Arcane Research recorded that a correlation between the BTC quotes and the Nasdaq Composite index reached the highest since July 2020. This is another factor pushing Bitcoin down, as market indexes are reacting sharply to the Fed’s tightening financial policy and the global situation as a whole.
Growing Profits of BTC Investors
One of a few pieces of positive news that pushed BTC rates up for a while was the Chainalysis report. The report showed a 400% increase in global profits from investing in cryptocurrency assets in 2021 compared to 2020. It amounted to more than $162 billion ($162.7). Nearly $47 billion ($46.9) was earned by American investors.
BTC Could Rise on Forecasts
If the Fed raises its annual inflation target from 2% to 3%, it could boost the first cryptocurrency’s price. The agency is likely to be forced to adjust the forecast as achieving the initial figure looks unlikely, and the forecast’s failure will undermine confidence in the Fed’s monetary policy. This opinion was expressed by Mohamed Aly El-Erian, chief economic adviser at Allianz, one of the largest insurance companies in the world included in the list of systemically important for the world economy.
Algorithmic Stablecoins Are Dangerous
Tether CTO Paolo Ardoino believes that highly capitalized algorithmic stablecoins pose a risk to the market. He gives as an example the UST stablecoin, which is ensured by a smart contract that keeps the coin’s value at $1 thanks to arbitrage operations with Terra tokens (LUNA). The expert thinks that with the high capitalization of such stablecoin, secured by digital assets, its liquidity is questionable, and its liquidation could provoke a cascading effect.
Meanwhile, the total cap of Terra USD reached almost $18 billion.
MetaMask: Pros and Cons
MetaMask, one of the most popular crypto wallets, announced the soon introduction of Bitcoin (BTC) support. And a day after the announcement, another news broke — hackers threatened MetaMask wallets on Apple devices. The vulnerability was found in the iCloud service, which automatically backs up confidential data of Apple users. The message was published after a user had lost his NFTs and cryptocurrencies worth $655 thousand due to an iCloud hack.
Play to Earn
Game activity in the Play-to-Earn sector has grown by more than 2,000% in the past 12 months, says research from analytics company DappRadar. The total number of unique active wallets (UAW) in the P2E sector was approximately 1.22 million in March. For Q1 2022, 52% of all blockchain activity came from the gaming segment. This performance helped P2E gaming projects raise more than $2.5 billion in funding in Q1, a 150% increase over the same period last year.
Note that this is not all the crypto news over the past week, but only a cursory overview of the most high-profile newsbreaks. More updates can be found on our website and social networks daily!