Crypto Labs Market Watch for Apr. 12th
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1. Ethereum price weakens against Bitcoin — Here’s why
Ethereum price stagnates in its ETH and BTC pair as investors’ expectations for a spot ETH ETF dwindle.
Ether had been rallying since the beginning of the new year but began tapering off in mid-March. The altcoin has trailed Bitcoin
BTC since Jan. 1, gaining roughly 48% compared to BTC’s 57% in their respective USD pairs year-to-date.
There are three main reasons why ETH has been underperforming BTC throughout the past several days, including a decrease in network activity and declining sentiment surrounding the approval of spot Ethereum ETFs in May.
ETH trended lower against BTC in the last 30 days
Ether is down 13.5% over the last 30 days, underperforming Bitcoin and other top layer 1 tokens. BTC’s price has dropped only 4% over the last 30 days, while other top-cap layer 1 tokens, such as BNB Chain’s BNB and Solana’s SOL have rallied 15.5% and 16%, respectively, over the same timeframe.
The ETH/BTC ratio began declining on March 8, reaching its year-to-date low of $0.047 on April 7.
There are several reasons why Ether has underperformed Bitcoin over the last month, including new all-time high prices, over $10 billion in investments into the spot BTC ETF, and Bitcoin Ordinals trading volume surging close to $3 billion. The upcoming Bitcoin supply halving, which has historically preceded a crypto market bull run, has also added to BTC’s tailwinds.
2. Why XRP price might jump 70% vs. BTC after the Bitcoin halving
Whale accumulation patterns and critical Bitcoin halving fractals suggest a significant rebound for XRP/BTC price in the upcoming months.
XRP has lagged Bitcoin so far in 2024 in terms of price performance, falling around 2.5% year-to-date (YTD) versus the top cryptocurrency’s 60% gains in the same period. In turn, the XRP/BTC exchange rate is down 40% YTD.
However, the pair shows signs of recovering in the days leading up to Bitcoin’s halving in 2024. A constellation of bullish signals may buoy this momentum, potentially amplifying it following the event.
XRP price post-halving fractal
Historically, XRP has demonstrated a tendency to outperform Bitcoin in periods surrounding halving events.
For instance, the XRP/BTC pair rose by over 100% after the third Bitcoin halving in May 2020. Similarly, the pair jumped 85% around the second Bitcoin Halving in July 2016.
These patterns elevate the prospect of XRP outperforming Bitcoin following the upcoming halving on April 19.
3. Generation Z and millennials choose crypto over stocks
A recent survey by Policygenius found that one in five American adults own cryptocurrencies.
A new survey suggests that young Americans are more likely to own cryptocurrencies than stocks, signaling a shift in financial assets and investment strategies from those preferred by older generations.
The study, which was conducted between Oct. 16 and Oct. 19 and published by the Policygenius Financial Planning Survey on April 9, featured 4,063 adult respondents in the United States. The survey revealed that 20% of Gen Zers (ages 18–26) and 22% of millennials (ages 27 to 42) are much more likely to invest in alternative assets like cryptocurrencies and nonfungible tokens (NFTs) compared to their older counterparts.
4. El Salvador’s newest Hilton hotel to tap into tokenized debt on Bitcoin
Investors will need to make a minimum $1,000 investment to purchase the token, which will be issued on the Bitcoin layer 2 “Liquid Network” under the ticker HILSV.
Investors will soon be able to own a slice of a new, 4,500 square-foot Hampton by Hilton hotel in El Salvador by buying tokenized shares issued on the Bitcoin layer 2 Liquid Network.
The country’s first ever tokenized asset raise will be facilitated by Bitfinex Securities — the first licensed and registered digital asset provider in El Salvador — while the debt issued from Inversiones Laguardia S.A. de C.V.
The hotel will be constructed at El Salvador’s international airport, with Inversiones Laguardia looking to raise $6.25 million from crowdfunders in exchange for a 10% coupon over a 5 year term.
5. Bitcoin derivatives metrics suggest $70K is here to stay
Reduced leverage use in Bitcoin futures greatly reduces the odds of cascading liquidations in the case of a BTC price pullback.
Since March 25, Bitcoin has struggled to maintain its value above the $71,000 mark, a trend that some may view as a sign of bearish momentum. Nevertheless, insights from the BTC derivatives market reveal a more stable environment, as the previous atmosphere of rampant optimism has notably subsided.
Resilient U.S. inflation strengthens the bull case for Bitcoin
Currently, Bitcoin finds it challenging to hold its ground above the $70,000 threshold. Yet, certain analysts believe that the recent U.S. inflation figures — showing unexpected resilience — and the unsustainable U.S. government fiscal trajectory create an ideal backdrop for investing in scarce assets.
Crypto Labs Team
April 5th, 2024
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