News of the week. Friday, May 14

Friday, May 14. The week is coming to an end, so we can talk about the most interesting news in the crypto industry for this week.

Bitcoin Price Decline

On the night of May 13, the price of Bitcoin fell by 17% to $45,800. As the price approached this level, buyers immediately bought out the decline, and the price of the main cryptocurrency is now in the range of $49,500 to $51,000.

As might be expected, Bitcoin was followed by other currencies, and as a result, the capitalization of the crypto market declined to $2.280 trillion.

This drop is associated with another statement by Elon Musk. The head of Tesla said that payment in bitcoins for electric cars is postponed, due to the non-ecological nature of mining the first cryptocurrency. He also added that the cryptocurrency will return to payment methods after mining becomes more environmentally friendly. The US economic performance contributed to the decline of the market crypto, with inflation reaching a record 4.2%, the last time being 12 years ago. In three months, inflation rose from 1.4% to 4.2%, a triple increase. 

You don’t need to be reminded that the US economy is considered the strongest in the world. Since cryptocurrencies are a risky type of asset, and also quite volatile, investors could get out of positions due to such indicators. Of course, Musk’s statement also affected the market, but US inflation here had a much bigger impact.

Dogecoin and Elon Musk

It will sound strange, but Dogecoin is no longer perceived without Elon Musk. It sounds so normal, it doesn’t raise any questions.

The meme coin has had an interesting week: ups and downs, a Twitter poll, whether Tesla should accept payment at DOGE, an upcoming listing on Coinbase. All these moments provoked high volatility in the price of Dogecoin and at some point the coin completely flew out of the list of TOP-5 cryptocurrencies by capitalization. But at the end of the week, the positions were returned, and now Dogecoin flaunts on the 5th place in the list of CoinMarketCap.

We all know that Max loves the crypto market. His Twitter is just a godsend for a novice investor, because Elon’s statements directly affect the crypto market. And just the fact that young investors invest in something, according to the statements of their idol, begins to dislike the public. Assets become more expensive or cheaper just because Musk wrote something on Twitter, and his followers immediately opened positions. Some part of the crypto community is interested in how Elon has not yet been brought to justice for his statements, because market manipulation is on the face. The former director of relations of the US White House and CEO of Skybridge Capital said that Musk is not a moron, and the fact that Tesla refused to accept BTC as payment for electric cars may be a tactical move.

To this thought, we can add the fact that since Musk has not yet been brought to justice, it means that he is doing everything within the limits of what is available. One way or another, it must end sometime, so we are waiting for developments.

Ethereum has updated its historical high

Although Ethereum has long been predicting «career sunset», due to the emergence of many other promising projects (Tron, EOS, NEO, Waves), as we can see, it does not lose its relevance. The new price limit was set at $4380. Ethereum continues to be the most sought-after platform that allows the creation of decentralized applications. If one realizes the situation, the DeFI and NFT sectors would be much more difficult to implement without Ethereum.

We can’t help but mention Ethereum and BCS – Binance Smart Chain. Blockchain of the same-name exchange is actively conquering the crypto market, having risen to third place in the ranking of cryptocurrencies. Of course, the capitalization of Ethereum is now more than $370 billion, so it is difficult to talk about anything. But the cost of BNB in the summer of 2020 was 34 times lower.

If BCS were to become in demand by Ethereum, then ETH should not lose much of its value: it has permanently taken its place in crypto history because it has launched many projects.

Traffic on crypto exchanges is off the charts

The Glassnode Analytics Service provides up-to-date statistics. According to her, in April 2021, the crypto exchange was able to attract more than 530 million visitors. Interestingly, this figure did not reach the level until January 2018 – only 500,000 users were missing.

As expected, most of the visitors came to the Binance Exchange – 40%. Next came Coinbase, Upbit, Indodax, Kraken. In April, the trading volume on spot exchanges exceeded $2 trillion, where Binance also became the leader. 

What does this statistic tell us? First of all, there are new traders coming to the crypto exchange, which is a fascination with trading activity. There is also regular news in the media that purses with BTC and ETH continue to grow, and cryptocurrencies are reluctant to sell – positions are consolidated.

It is also worth noting that the crypto market has never been so backed up by investment by institutional investors, so the correction can certainly not be protracted. In any case, all we can do is wait and see how the market behaves.

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