Market Wrap: Bitcoin, ETH and DeFi Assets Fall as Investors Focus on Downside

An influential survey shows 60% of respondents thought bitcoin could hit $10,000 before it recovers

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key takeaways

  • Bitcoin fell back sharply after rallying to $22,000 last Friday
  • The upcoming release of the US CPI report and the kickoff of the second quarter’s earnings season add to uncertainty

Bitcoin fell to well below $21,000 Monday after climbing to $22,000 last Friday. The cryptocurrency dropped 2.2% to $20,489, while ether (ETH) dipped 3.1% to $1,140 as of 4:00 pm ET Monday. 

Major cryptoassets’ slide came after the Bloomberg MLIV Pulse survey found that 60% of respondents thought bitcoin (BTC) would head lower to $10,000 while 40% saw it climbing to $30,000.

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Among the sectors hit hardest today was decentralized finance (DeFi). Uniswap’s token was down 8.17% to $5.83, while Maker’s token fell by 4.09% to $917.02. Aave’s token dropped 2.59% to $75.47.

US equities also skidded, with the DJIA closing 0.5% lower at 31,173.84, while the S&P 500 dropped 1% and Nasdaq was down 2.3%.

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Despite Monday’s slide in the major indexes, Nicholas Colas, co-founder of DataTrek Research, believes there could be more upside, at least in the short term. “The current move higher for US large caps may have a little further to run, but we are already most of the way through the ‘typical’ 2022 bear market rally (up 6% versus 7 – 11%),” he wrote in a note Monday.

Oil prices tentatively resumed their downward trend as China’s new wave of Covid-19 cases rises. WTI Crude Oil for August delivery was down 1.38% to $103.34 per barrel, while Brent Crude (ICW)’s price fell by 0.7% to $106.27 for September delivery, according to Wall Street Journal’s real-time data. 

The euro is still gradually closing in on parity with the USD as experts warn of an impending economic slowdown in Europe. 

“Germany, the industrial powerhouse of Europe, is facing a dramatic drop-off in production thanks to the Russian threat to cut off natural gas, and France just nationalized its national utility company to keep energy costs down.” Michael Rosmer, CEO and co-founder of DeFiYield, told Blockworks. “This is going to ripple through all markets, not just crypto, but crypto and equities will likely face the most volatility as a result,” he said. 

“Even more investors will flee to safe-haven assets, meaning that without positive news to counterbalance Europe’s economic struggles, investors could be due for further pain,” Rosmer added. 

Top Stories

3AC Co-Founders Remain Silent, Creditors go to Court

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  • In a court hearing Tuesday, Zhu and Davies were mute and unseen on a Zoom call. 

What Could Crypto M&A Look Like in This Year’s Second Half?

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