Bitcoin falls to the lowest level in almost a month.
Hello, Asia. Here’s what’s happening in the markets.
US Central Bank President Jerome spoke tough for a second day in a row. Banking giant JPMorgan has ended its relationship with crypto exchange Gemini, as CoinDesk’s Ian Allison first reported. Silvergate, the crypto-friendly bank, will close its operations.
Bitcoin absorbed it all, then fell to its lowest level in nearly a month. The largest cryptocurrency by market capitalization was recently trading at around $21,750, down more than 2% in the past 24 hours. BTC dropped below $21,600 at one point after hovering widely above $22,000 for much of this month. Investors grappled with worrisome jobs and price data that prompted governors at Powell and the Federal Reserve to reinvigorate their monetary aggressiveness as an inflation prescription.
The outlook for a 50 basis point (bp) interest rate hike now stands at around 70% after broadly favoring a more dovish 25bp hike in previous weeks.
“After celebrating the first shots of disinflation over the past two months, the Federal Reserve had to reinvigorate its hawkish stance by talking tough on rate hikes, I think it’s worth noting that they were marching their hikes as having a substantial impact on inflation, and then it became clear that inflation proved more persistent than expected.Quinn Thompson, head of growth and capital markets at Maple, the platform for blockchain-based capital markets, CoinDesk wrote in an email, “A 50 basis point rate hike is fundamentally unavoidable now.”
Thompson added that “barring a breakdown in the system, such as some credit event, it seems increasingly likely there won’t be a rate cut until next year.”
Ether performed similarly to bitcoin and also fell around 2% to change hands just above $1,530. This level was well below its late February highs of over $1,700. Other major cryptos were mostly in the red with SOL, the Solana blockchain token down more than 9% and APT, the native Aptos Labs layer 1 blockchain cryptocurrency down more than 6% . The CoinDesk Market Index, a measure of the performance of the broader crypto market, fell nearly 3%.
The Nikkei rose about 0.5% as Asian stock markets opened. US indices were flat with the Nasdaq and S&P 500, which have a strong tech component, up slightly, but the Dow Jones Industrial Average (DJIA) down a few percentage points.
IMaple’s Thompson was wary of the outlook for cryptos amid the Fed’s apparent hawkish turn, which has historically driven down the prices of cryptos and other riskier assets.
“I suspect we could retest the lows that were hit last year as a result of the rate hike, but also because of the Fed’s ongoing monetary tightening regime which is draining liquidity from the markets,” he wrote. “Much of this tighter monetary policy is being priced into fixed income markets. But risky assets have yet to price in the potential for downside spillovers, and that could spell trouble for equities and stocks.” crypto.”
Conic Finance’s big promise, but will it live up to it?
An earlier version of this story appeared separately on the CoinDesk website.
A new tool for capturing returns from the prominent stablecoin exchange service Curve has attracted over $60 million from depositors just over a week after its launch.
Conic Finance, which went live on March 1, allows users to deposit tokens into its omnipools, a new product that diversifies exposure in the Curve ecosystem while increasing rewards.
Each omnipool allocates the liquidity of a single asset in different Curve pools. All liquidity provider Curve (LP) tokens are staked on Convex to increase Curve Rewards (CRV) revenue. Convex (CNX), another token in the Curve ecosystem, is also rewarded, as is conic (CNC), Conic’s native token.
Conic users can earn up to 21% annualized returns on the three omnipools for dai (DAI), frax (FRAX) and USD coin (USDC). The USDC pool has attracted over $50 million in liquidity alone, as Conic currently provides one of the highest yields available in the crypto market for USDC. Frax and dai deposits are considerably lower at $7 million and $5 million, respectively.
Holders can lock their CNC tokens for vlCNC to participate in Conic’s governance and directly control how liquidity is allocated between Curve pools by participating in Conic’s Liquidity Allocation Votes (LAVs) – which determine the share of liquidity of an omnipool that a Curve pool can receive.
In the coming weeks, Conic’s demand among traders for its yield-generating products could ultimately generate value for its own CNC token.
As such, CNC tokens are currently trading at $8, losing 4% in the last 24 hours with a market capitalization of $32 million.
Admittedly, not all DeFit watchers fully embrace Conic’s approach. Colin Johnson, CEO and co-founder of token art investment platform Freeport, called Conic “an exciting new route to accessing yield within the Curve ecosystem,” but cautiously added that “we have seen historically what happens with promised returns of 20% or more (Terra).”
“Either they fade quickly – which is most likely to happen here – or they build up an amount of stress the system can’t handle, and we get an implosion,” Johnson wrote. “Users should always be wary when yield is provided in a token that represents the very system they are interacting with. When that token falls out of favor, its price tends to drop.”
Curve uses smart contracts to provide an efficient way to trade stablecoins while maintaining low fees and low slippage, according to developer documents. Depositors on Curve earn annual returns of up to 4% from one of the platform’s many pools, which locks over $5 billion in Ethereum-based tokens on its platform.
Curve Tokens (CRV) are issued as yield farming rewards for liquidity providers on Curve Finance, and can be converted to vote locked CRV (veCRV). Owning veCRV allows users to participate in the governance of the platform, earn higher rewards and fees, and receive airdrops.
Tokens are time-locked, which means users are incentivized to lock their CRV for a long time to receive more veCRV and platform rewards. However, this mechanism effectively locks in liquidity, creating opportunity costs for users.
This is where protocols like Conic come in, allowing users to gain exposure or provide liquidity to the Curve ecosystem to be rewarded without having to lock up their tokens for long periods of time by depositing directly into Curve.
Bitcoin fell to a three-week low after US Federal Reserve Chairman Jerome Powell’s hawkish testimony to Congress prompted traders to set a higher “terminal rate.” Martha Reyes, Digital Economy Initiative Advisory Board Member, spoke. Additionally, NEAR Foundation CEO Marieke Flament discussed her vision for Web3 and female leadership in the crypto space on International Women’s Day. Grayscale Investments Chief Legal Officer Craig Salm, MenaPay CEO Çağla Gül Şenkardeş, and WomenInDeFi Brand Strategist Umeh Chinonye also joined the conversation. Grayscale and CoinDesk are both owned by Digital Currency Group (DCG).