Bitcoin and Ethereum Price Manage to Hold Support Amid Inflation Fears
After a scary correction this Saturday, with the Bitcoin price dropping to a low of $17.9k, the BTC price is recovering again, currently trading at $19.4k. Ethereum also recovered after dipping to $900, currently trading at $1k, up over 5% in the past 24 hours. The market saw a significant recovery after yesterday’s dump, which spells good news for next week’s price action.
Why Is Bitcoin and Ethereum Price Dropping?
The most significant factor contributing to the cryptocurrency bear market is fears of inflation and the rising probability of a global economic collapse. Economists are watching the interest rates rising, and according to a recent report from the Wall Street Journal, there’s a 44% likelihood of a recession in the next 12 months.
The stock market has been in disarray for the past couple of months, and since Bitcoin follows the stock market, it too has fallen dramatically this quarter. To add insult to injury, since altcoins follow Bitcoin’s price action, this created a cascade effect that caused a crypto market collapse, pushing most digital assets to record lows.
The Federal Reserve has been extremely active the past couple of months in its attempt to curb inflation and slow down recession by utilizing several tools such as raising interest rates. The Fed’s job is to stabilize the US Dollar, and so far, it seems that its efforts have been less than successful.
Global Crypto Market Capitalization at a Two-Year Low
With the sustained bear market for Bitcoin, Ethereum, and other cryptocurrencies like XRP, Solana, and the collapse of Terra Luna, the global cryptocurrency market capitalization has suffered tremendously, touching a two-year low.
The current market capitalization for the crypto market is at $860 billion, losing over $2 trillion in value since its peak in November 2021! The massive devaluation is affecting large and small investors and causing uncertainty in the market.
The good news is that crypto projects are on a fire sale, and those looking to Dollar-Cost average, purchase NFTs, or invest in virtual real estate, can do so for incredibly low prices.
Check out our article for the Top 3 Metaverse Projects to Buy Virtual Real Estate in (June 2022) for some of the best places to purchase virtual real estate during this bear market.
Will the Crypto Market Recover?
The question isn’t whether or not the cryptocurrency market will recover. The real question is when? It seems the selloff is still intensifying, and there doesn’t seem to be an end in sight. At this rate, it wouldn’t be surprising for prices to continue to struggle until next year, when the market might start rebounding from its all-time lows and attempt a trend reversal.
It all depends on the stock market and the condition of the US and the global economy to signal a trend reversal for cryptocurrencies. Keeping a close eye on inflation levels and CPI numbers is a good indicator of the direction the markets are moving in and could signal a trend reversal if inflation starts to decrease.
At the end of the day, markets are cyclical, and it’s only a matter of time before a bear market ends, and a bull market follows.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any project.
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Live Updates
- Jan 23, 2025 1:44 pmBerkshire Hathaway's Growing Interest In Cryptocurrency InvestmentsAccording to PANews, Berkshire Hathaway, led by CEO and Chairman Warren Buffett, has historically expressed skepticism towards cryptocurrencies. However, recent actions suggest a shift in this stance. The company has invested millions in Nu Holdings Ltd., a Brazilian bank associated with cryptocurrency. Nu Holdings' stock has risen by 34% year-over-year, and it operates its own cryptocurrency platform. Documents from the U.S. Securities and Exchange Commission (SEC) reveal that Berkshire Hathaway's stake in Nu Holdings increased from 0.1% at the end of the fourth quarter of 2022 to 0.4% by the third quarter of 2024. This translates to over 86 million shares valued at nearly $1.2 billion by the end of the third quarter of the 2025 fiscal year. This investment indicates that Berkshire Hathaway is benefiting from a sector Buffett previously claimed to have limited understanding of. As Berkshire Hathaway continues to explore cryptocurrency-related investments, Buffett may need to reconsider his earlier statements about the limited impact of cryptocurrencies.
- Jan 23, 2025 1:42 pmBNB Completes 30th Quarterly Burn: Over 1.63 Million BNB Destroyed Worth $1.16 BillionThe BNB Foundation has announced the completion of its 30th quarterly BNB token burn, marking another significant milestone in its commitment to maintaining token scarcity and promoting the ecosystem’s long-term health.Key Details of the BurnTotal BNB Burned: 1,634,200.95 BNBValue at Time of Burn: Approximately $1.16 billionAutomatic Burn: 1,524,200.95 BNBPioneer Burn (Anti-Black Hole Plan): 110,000 BNBThe quarterly burn incorporates two mechanisms:Automatic Burn: Adjusted dynamically based on BNB price and the total number of blocks generated on the BNB Chain.Anti-Black Hole Plan (Pioneer Burn): Used to address cases where unrecoverable BNB enters inaccessible wallets.Anti-Black Hole Plan DetailsThis burn includes 110,000 BNB tied to the BNB Beacon Chain, where pledged tokens left by validators were permanently removed from circulation due to the chain’s suspension. These tokens, considered to have entered a "black hole," are now destroyed. Validators affected by this transition will be compensated through the anti-black hole plan.
- Jan 23, 2025 1:42 pmPIMCO: The Fed will keep interest rates unchanged for the foreseeable future, waiting for Trump's policy to become clearOdaily Planet Daily News Pacific Investment Management Co. (PIMCO) said that the Federal Reserve will keep interest rates unchanged or even raise them for the "foreseeable future" while waiting for Trump's policies to become clear. Dan Ivasin, chief investment officer of PIMCO, said he expects the Fed to keep interest rates stable until "there is more clarity on the data or policy side." "In the long run, many of the policies introduced by Trump may have a very, very positive impact on economic growth (and) productivity. Some policies may make sense in the long run, but they will bring some pressure in the short term." Ivasin said it is "certainly possible" for the Fed to raise interest rates, although this is not his baseline scenario. He pointed out that several recent surveys have shown that consumer inflation expectations (usually a leading indicator) have risen. "From an inflation perspective, we are not out of the woods yet." (FT)
- Jan 23, 2025 1:40 pmBTC and ETH options with a notional value of approximately $3.526 billion will expire on FridayOdaily Planet Daily reported that Deribit data showed that BTC options with a nominal value of approximately US$2.986 billion and ETH options contracts with a nominal value of US$540 million will expire and be delivered on Friday (January 24); among them, the maximum pain point price of BTC is US$99,000, and the maximum pain point price of ETH is US$3,300.
- Jan 23, 2025 1:38 pm$BTC to go parabolic when it hit's approx. $92k?null source: https://x.com/Bitcoinsensus/status/1882301888907100548
- Jan 23, 2025 1:37 pmSOL rebounded and broke through 250 USDT, and the 24-hour decline narrowed to 2.22%OKX market shows that SOL rebounded and broke through 250 USDT, and is now at 250.04 USDT, with the 24-hour decline narrowed to 2.22%. (This newsletter is generated by AI)
- Jan 23, 2025 1:36 pmIf you were to guess, when exactly does $BTC "Rocket Time" start?null source: https://x.com/Bitcoinsensus/status/1882301396097380728
- Jan 23, 2025 1:30 pmPlanet Lunch News1. Yesterday, the US Bitcoin spot ETF had a net inflow of US$248.39 million; 2. Yesterday, the US Ethereum spot ETF had a net inflow of US$79.88 million; 3. The US Fifth Circuit Court of Appeals ruled that the Treasury Department's sanctions on Tornado Cash exceeded its authority; 4. Circle has issued a total of 3.25 billion USDC on Solana in the past week; 5. Tornado Cash co-founder: The accusation against me may convict software development itself, and the impact will go far beyond the crypto industry; 6. Jupiter DAO: If you are mislabeled as a witch, you can appeal after January 27; 7. Virtual Protocol ecological tokens fell across the board, and GAME fell 24.34% in 24 hours; 8. Metis 2025 will focus on building an AI ecosystem and announce its incubation project LazAI; 9. Well-known Chainlink community contributors: have begun to seriously consider replacing most of their ETH holdings with SOL; 10. The Trump family's crypto project WLFI has spent a total of $178.2 million to buy 6 tokens including ETH and WBTC; 11. Saudi Crown Prince says he is willing to increase investment and trade with the United States by $600 billion; 12. U.S. congressmen urge investigation into Trump's business relationships, questioning whether his currency issuance may breed corruption.
- Jan 23, 2025 1:28 pmBOB announces integration of Chainlink CCIP protocol as the standardized cross-chain infrastructure for its native assetsOdaily Planet Daily News Hybrid L2 network BOB announced the integration of Chainlink's Cross-Chain Interoperability Protocol (CCIP) protocol as the standardized cross-chain infrastructure for its native assets to promote the innovative development of BTC DeFi. BOB has been committed to providing infrastructure for ecosystem developers to enhance the functionality and coverage of its hybrid L2 network. To fulfill this commitment, BOB will integrate Chainlink CCIP. The CCIP protocol supports the use of BOB's trust-minimized BitVM bridge to link Bitcoin and Ethereum native networks, helping BOB realize Bitcoin's mission as the pillar of DeFi. Johann Eid, Chief Business Officer of Chainlink Labs, said: "BOB plays a vital role in promoting the development of the BTCFi ecosystem, providing underlying infrastructure support for the continued scalability of the Bitcoin ecosystem. Chainlink CCIP is ideally suited to provide developers on BOB with the tools they need to build highly secure and feature-rich cross-chain applications, and we are very much looking forward to how developers will use the Chainlink protocol standard to develop innovative applications that users love." BOB is a hybrid L2 platform that combines the security of Bitcoin and the flexibility of Ethereum smart contracts, designed to increase the utility of Bitcoin and expand its functionality. Positioning Bitcoin as the backbone of DeFi, BOB aims to unlock trillions of dollars of liquidity for BTCFi.
- Jan 23, 2025 11:40 amCity Holder Daily Combo and Daily Quiz January 23, 2025What is City Holder?City Holder is a cutting-edge build-to-earn game available on Telegram, blending city-building strategy with the thrill of earning rewards. Players can design, grow, and oversee their virtual cities while earning coins and bonuses along the way. With its emphasis on strategic decision-making and real-world rewards, it delivers an engaging and competitive gaming... source: https://www.coingabbar.com/en/crypto-currency-news/city-holder-daily-combo-january-23-2025-earn-coins
