Cryptocurrency markets experienced another day of drudgery on Friday, with Bitcoin (BTC) briefly feinting higher before settling back below $30,000. The largest digital asset by market capitalization was recently trading at $29,904, up 0.3%. Ether (ETH) remained largely unfazed, lingering at around its weekly low below $1,900. Major alternative cryptocurrencies, or altcoins, including SOL and XRP recovered some of their losses endured earlier in the day. MKR, the governance token of decentralized finance lender MakerDAO, defied the broader market and enjoyed double-digit gains, buoyed by the activation of a token buyback program.
However, micro-cap token CNC cratered as much as 75% during the day following a 1,700 ETH – some $3.2 million – exploit of Conic Finance, a Curve-adjacent decentralized finance protocol. The CoinDesk Market Index, which tracks the performance of a basket of digital assets, inched up 0.3% in the last 24 hours, underscoring a somewhat tepid trading day.
Rachel Lin, CEO and co-founder of decentralized derivatives exchange SynFutures, noted that the week started with enthusiasm over a favorable ruling in the Ripple-SEC case as investors expressed hopes for an altcoin season. But BTC and ETH failed to break resistance and returned to their weekly range lows, weighing on the market. “[Bitcoin] options data reveal high open interest in $31,000 and $32,000 Call Options, denoting strong resistance at these levels,” Lin said.
Investors will be eyeing a likely Federal Reserve interest rate increase and Bitcoin options expiry next week. Lawrence Lewitinn, head of content at The Tie and CoinDesk TV contributor, said that neither the U.S. central bank’s likely 25 basis point rate (bps) on Wednesday nor the end-of-month options expiry would likely stir Bitcoin from its current lull.
Will Peck, head of digital assets for asset manager WisdomTree, suggested that the impact of the Securities and Exchange Commission (SEC) approving a spot Bitcoin ETF from any of the financial services giants that filed applications last month was uncertain. “An underlying question is how much institutional money there might be out there,” Peck said.
Lin concluded that the outlook remains bullish as money continues to flow into the crypto ecosystem. “This could represent a brief reversal, potentially leading to a move up to $34,000 if BTC achieves a sustained breakout above $31,500,” she said.