Good morning. Here’s what’s happening:

Prices: Despite a slow start for the year, a new report by K33 shows that Bitcoin and Ether will be more volatile in 2023.

Insights Observers say that the market requires a new catalyst to drive prices higher. Could ether be the driver?


Volatility was expected, but did it happen?

Good morning Asia

Bitcoin opened the East Asia trading session at $27.686, down by 0.2%, while Ether was at $1.901, up by 0.4%.

2023 was a strange year for cryptocurrency. The price predictions were grim in December during the crypto winter. predicted that the price of bitcoin would be $10-12K in the first quarter 2023.

Since then, a lot of things have changed. Ordinals, bank failures, a liquidity crises.

The market remained fairly stagnant between March to mid-May. Bitcoin barely moved.

According to a new report by K33 research, this is starting to change.

Bitcoin’s range of trading fluctuated from $25,800 to $28,000 in the last week due to increased volatility. This variation was caused by the prospect of a debt ceiling agreement. Market rallies were triggered, increasing Bitcoin dominance and trade volumes.

K33 stated that the surge in interest was partly amplified due to over-leveraged longs. The progress of the U.S. Debt Ceiling negotiations also sparked a rally on the U.S. equity and crypto markets.

They say that this along with the change in the crypto-market structure, with stablecoins, ether and bitcoin’s increasing yet relatively lower dominance, shows a similarity to the previous bear markets with insufficient risk rotation.

There is no cure for this. The only thing that can help is more liquid.

The Biggest Gainers

Biggest Losers


Could Ether be the next market driver?

Ether will end May flat or down 0.3% . Bitcoin, against ether , is down nearly 7.

As CoinDesk reported previously, bitcoin is indeed on track to suffer its first monthly decline since December. This is primarily because of the likelihood that the U.S. Central Bank will continue to maintain high interest rates. This would boost the U.S. Dollar and cause a drop in the cryptomarket.

Experts say that the market requires a new catalyst to drive prices higher.

Ether is the driver.

According to the tracker ultrasound.money, in the past month over 143 830 ether valued at $275 million was burned.

(ultrasound.money)

Ether has entered a deflationary phase, with an annual supply growth rate of 1.46%. According to the tracker, the network will burn approximately $4.5 billion or 2,441,000 ether in 2018.

CoinDesk - Unknown(ultrasound.money)

The tracker shows that if Ethereum was to remain as a Proof of Work, its supply would grow by 2%.

Data shows that Ethereum’s deflationary position is causing ether and Bitcoin to break their correlation.

The positive correlation between these two digital assets has decreased this year. This suggests a market shift that will last for a long time, where they are more independent due to diverging economics of supply and demand.

The beginning of a long term regime change could be what we’re seeing. The economics of demand and supply underlying both tokens will continue diverging as Ethereum switches from PoW (proof of work) to PoS. This was stated by Pulkit Goyal , Vice President for Trading at OrBit Markets , previously to CoinDesk .

According to CryptoQuant’s data over 13% of the ether that exists has been staked. This has led to ether exchange balances reaching all-time highs.

Ether has risen 2.8% in the past week while bitcoin is lagging behind with a 2% increase.


Important events.

8:30 p.m. HKT/SGT(12:30 UTC) Canada Gross Domestic Product Annualized (Q1)


CoinDesk TV

If you haven’t seen it yet, here’s the latest episode of “First Mover” on CoinDesk TV.

Bitcoin (BTC), however, still appears to be on course for its first monthly decline since December. Berenberg has noted that MicroStrategy is an attractive alternative to Coinbase for investors who want to gain exposure to cryptocurrency. Mark Palmer, equity research analyst at Berenberg, shared his insights. Sara Gherghelas, DappRadar’s web3 analyst, joined “First Mover”, to discuss the new report about NFT lending marketplace Blend. LabDAO’s co-founder Niklas Ridtorff also spoke on the future open-source drug development.

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James Rubin is the editor.