Daily News | ETH fees reached a new low in stages, with a strong ETH ecosystem; Web3 portal launched by Google Cloud sparked controversy in crypto industry
Crypto Daily Digest: Ethereum fees were lowered to the lowest level in 6 months, the “Altcoin season” may be advanced; The Web3 portal launched by Google Cloud has sparked controversy in the crypto industry
First, let’s take a look at the trading activity of Bitcoin ETFs. According to Farside Investor data, on April 26th (last Friday), Grayscale Bitcoin spot ETF (GBTC) funds flowed out of $82.4 million; Meanwhile, Fidelity Bitcoin spot ETF (FBTC) outflows $2.8 million, Bitwise Bitcoin spot ETF (BITB) outflows $3.8 million, ARK 21Shares Bitcoin spot ETF (ARKB) inflows $5.4 million, and WisdomTree Bitcoin spot ETF (BTCW) net inflows of $6.6 million.
The decrease in transaction volume and token unlocking on the Ethereum network have led to a temporary low in network costs; ETH price is currently reported at $3,223.53, with a 7-day increase of 2.6%. Despite the rise in Ethereum prices, transaction fees on the Ethereum network have fallen to a six-month low. Analysts from crypto analysis platform Santiment suggest that this may indicate that Altcoins will rise.
As of April 27, the average cost of Ethereum transactions has dropped to $1.12. Santiment believes, “Traders have always been hovering between feeling that cryptocurrencies are about to ‘land on the moon’ and bearish sentiment cycles, which can be observed through trading fees.”
According to Ultrasound.money data, 74,458 new ETHs have been issued in the past 30 days, while only 57,516 ETHs have been destroyed, increasing the net supply of 16,979 new Ethereum.
This starkly contrasts with the previous five months, when ETH continued to deflate. Despite the recent increase in ETH-based inflation, over 437,000 ETHs have been destroyed since September 15, 2022, when the internet shifted towards the Proof of Stake consensus mechanisms (known as “Merge”).
Google Cloud has recently launched a Web3 portal that includes testnet tools, blockchain datasets, and developer learning resources, but the crypto industry has responded differently to this.
According to its website, developers can access various products and receive testnet tokens from deploying and testing their decentralized applications on the Ethereum testnet Sepolia and Holesky. The portal also provides a learning plan that includes tutorials on developing NFTs, implementing Web3 loyalty programs, and how to protect digital assets through multi-party computation.
Recently, Google has indeed made some progress in the Web3 industry. In early 2024, Google updated its policy to allow certain crypto products to be advertised on major search engines, including Bitcoin Exchange Traded Funds. Recently, Google has expanded its functionality to allow users to search for wallet balances across multiple blockchains, such as Bitcoin, Arbitrum, Avalanche, Optimism, Polygon, and Fantom.
The token economics of tracking projects is essential for crypto investors, and the several tokens unlocked in May are very eye-catching, especially the highly publicized Python Network - Python, which is worth over $1 billion, will unlock the first set of tokens to eco participants within three weeks, up to 1.25 billion.
In addition to Python Network, several other crypto projects also plan to unlock tokens worth billions of dollars. According to Token.Unlocks data, the following are some important tokens that will be unlocked in May:
Memeland will unlock $150 million of Memecoins on May 3; Aptos will unlock $100 million of APTs on May 12;
Arbitrum will unlock $100 million of ARBs on May 16; Avalanche will unlock $325 million of AVAXs on May 22; STRK (Starknet) will unlock 8.8% of its circulation supply on May 15.
Market Trends: The market is volatile, and the ETH eco is showing strong performance
BTC has recently shown a volatile trend, with the market’s focus mainly on the Ethereum eco. Regarding macroeconomics, the US stock market has rebounded, with market predictions for a 35 basis point interest rate cut this year and a more significant cut of 60 basis points expected next year. This macroeconomic expectation change may impact the crypto market, especially on the attractiveness of risky assets.
Market Hotspots:
Ethereum prices and market hype: ETH surged yesterday, breaking through $3,300 at one point, while the ETH/BTC exchange rate also broke through 0.05. The market is speculating on the possibility of passing ETH spot ETFs by the end of May, which has increased the market’s expectation of demand for ETH.
However, the current trading activity on the ETH chain is not active, manifested in lower gas fees, which may indicate that speculative purchases more influence the short-term price increase.
The Ethereum eco has shown outstanding performance in related projects: Ethereum-related re-staking protocols, such as SSV and ETHFI, have shown price increases. At the same time, Ethereum’s Layer2 protocols, such as Optimism (OP) and Strike (STRK), have also demonstrated price increases. Of particular note, this week the OP will unlock tokens worth $60 million, which may have an impact on their market prices.
The rise of the concept of Deposit: Deposition sector tokens such as HNT and MOBILE have shown significant price increases. In addition, the previously released Solana based SAGA phones have achieved a return on investment through Meme token airdrops, demonstrating market interest and investment potential in Depin and related technologies.
With market expectations for ETH spot ETFs and continued attention to the Ethereum eco, coupled with positive macroeconomic expectations, the crypto market may continue to experience volatility in the coming weeks. Investors should closely monitor relevant policy trends, market unlocking events, and on chain data, all of which may have an impact on market sentiment and token prices. Investors are advised to remain cautious, pay attention to market trends, and adjust investment strategies in a timely manner to cope with possible market fluctuations.
Macro: The performance of the US stock market was lower than expected, while the Asian market opened well on Monday. The Japanese yen exchange rate fell below a critical level
Last Friday, April 26, the overvaluation of the US stock market disappointed investors, especially as several tech giants increased their investment efforts before releasing their financial reports.
The strong reports from Microsoft and Google’s parent company Alphabet on Thursday drove up the S&P 500 index, the largest weekly increase since early November last year. The S&P 500 index rose about 7% in 2024 and about 24% since the end of October last year.
However, investors were also hit by the disappointing performance of Facebook’s parent company, Meta Platforms, with its stock price falling more than 10% on Thursday.
Morgan Stanley’s strategist stated that the median stock price of companies in the S&P 500 index for this quarter was only 0.2% higher than analyst expectations. In contrast, the median stock prices of companies that did not meet profit expectations fell 4% behind, indicating poor performance.
The rise in US treasury bond bond yields may be another factor affecting investors. When bond yields rise, investors’ expectations of future profits for the company will be affected as they can now obtain higher returns from risk-free government bonds. With more evidence showing that inflation is stronger than expected, the benchmark 10-year treasury bond bond yield hit 4.74% this week, the highest level since early November last year.
With signs of economic strength and inflation emerging, the expectation of interest rate cuts has been the main driving force behind the stock market’s rise, but this expectation has faded. The futures market on Friday showed that investors had only a 35 basis point expectation for a rate cut in 2024, while the pricing in January exceeded 150 basis points.
Prior to the Federal Reserve’s policy meeting later this week, Asian stock markets opened well on Monday. The Asian stock market was boosted on Monday by the rise of Wall Street stocks led by technology stocks on Friday.
On Friday, the Bank of Japan kept interest rates unchanged as expected, but failed to express any meaningful concerns about the exchange rate. The yen to dollar exchange rate fell to 157.79 on Friday, a new low in 34 years, and for the first time in decades, the dollar to yen broke through a psychologically critical level of 160 yen, although only briefly. Most observers may expect Tokyo to take action now - as the last intervention was in September and October 2022, when the US dollar exchange rate was around 146.00 and 152.00 yen, respectively.
Other Asian countries are also becoming increasingly uneasy about exchange rates. Indonesia has raised interest rates to cope with the weakness of the rupee, while Vietnam and India have directly intervened in the foreign exchange market to purchase their own currencies. South Korea has also stated that it will follow suit.
Overall, the Federal Reserve’s policy decision on Wednesday may prompt forex and other markets to remain cautious in the coming days. The focus of this week’s Asian economic calendar includes the China Purchasing Managers Index, minutes of the Bank of Korea meeting, inflation in South Korea and Indonesia, and Hong Kong GDP.
Regarding commodities, oil prices have fallen by 1% due to the impact of ceasefire talks between Israel and Hamas, as well as inflation concerns in the United States. Brent crude oil futures fell 1.1% to $88.50 per barrel, while West Texas Intermediate (WTI) futures fell 1% to $83.01 per barrel.
The global benchmark Brent crude oil price remained largely unchanged from the same period last year, at $81.76 per barrel. But the rise in oil prices means that profitable refining profits starting from the beginning of this year will decline. Total Energies expects its refining business to experience a decrease in profits in the second quarter and beyond due to geopolitical tensions and OPEC+production restrictions.
Gold fell 0.34% to $2,329.37 per ounce.
