Bitcoin traded lower on Monday after buyers failed to support a weekend rally toward $60,000. The cryptocurrency was trading at around $56,000 at press time and was down around 5% over the past 24 hours.
Stocks and cryptocurrencies initially ticked higher earlier during New York trading hours after U.S. President Joe Biden said he would renominate Federal Reserve Chairman Jerome Powell, following some speculation that Fed Governor Lael Brainard could replace Powell to lead the central bank for the next four years.
For now, some analysts viewed the current pullback in cryptocurrencies as a normal event after a strong rally over the previous month.
With Bitcoin and other crypto assets having reached new all-time highs, there was always likely to be some profit taking from investors, which then turns into price weakness, Simon Peters, an analyst at eToro, wrote in an email to CoinDesk.
Latest Prices
Bitcoin (BTC): $55,898, -6.17%
Ether (ETH): $4,065, -7.19%
S&P 500: $4,682, -0.32%
Gold: $1,804, -2.14%
10-year Treasury yield closed at 1.62%
As Bitcoin buyers took some profits, stocks appeared to be holding up. The S&P 500 was up around 4% over the previous month, compared with a 7% decline in BTC over the same period.
Recent data showed a decline in the 60-day correlation between Bitcoin and the S&P 500. The short-term disconnect between the cryptocurrency and the stock index suggested that investors still had an appetite for risk, even as some had reduced exposure to crypto.
Bitcoin Funds Attract New Capital
Digital asset investment products saw inflows of $154 million last week despite the recent sell-off across cryptocurrencies. The rise in fund inflows reflected strong investor appetite for crypto exposure.
The new futures-based Bitcoin exchange-traded fund launches in the U.S. represented 90% of inflows into Bitcoin products last week, as per a report by CoinShares.
Ethereum investment products saw inflows of $14 million last week, marking their fourth consecutive week of inflows. Other alternative cryptocurrency products, such as Cardano, saw minor outflows a week ago.
Altcoin Roundup
Shiba Inu slipped in Coinbase volume rankings: SHIB represented 6.72% of the total volume on the crypto exchange, slipping to the third position behind Bitcoin and Ether, Coinbase Institutional's weekly email dated Friday showed.
Metaverse gaming and NFTs could account for 10% of the luxury market by 2030: Morgan Stanley noted that luxury brands were already exploring collaborations with gaming and metaverse platforms, with an increasing number of revenue-sharing deals. That could add $10 billion-$20 billion to the luxury sector's total addressable market, CoinDesk's Will Canny reported.
Algorand project raises $3.6M: C3 Protocol, a cryptocurrency trading project connected to the Algorand blockchain, raised $3.6 million in a funding round led by Arrington Capital and Jump Capital, CoinDesk's Ian Allison reported. Algorand's ALGO token was down around 6% over the previous month, compared with a 7% decline in BTC and a 1% rise in ETH over the same period.