BTC and ETH this week overview
Market performance
The cryptocurrency market as a whole has been “violently volatile” this week:
Bitcoin: Bitcoin fell sharply on Monday as global markets fell, but as macro data was released on Tuesday, market sentiment improved and Bitcoin prices rebounded.
Ethereum: It also fell rapidly on Monday due to the market crash. The serial liquidations further exacerbated the decline. Although it rebounded afterwards, the rebound was small.
Key Events
US recession triggers global market plunge
On Monday, Japan's stock market plummeted and triggered the circuit breaker mechanism. Subsequently, the three major U.S. stock indices fell across the board. The S&P 500 index hit a low of 5,119 points, the Dow Jones Industrial Average fell to 38,499 points, and the Nasdaq Composite Index fell to 15,708 points.
The market reacted strongly to the lower-than-expected US employment data, which triggered recession concerns and led to risk aversion and panic selling. However, with the release of other macro data in the middle of the week, the market gradually recovered and began to rebound.
US Macro Data
The U.S. ISM non-manufacturing PMI reached 51.4 in July, exceeding expectations. The number of people applying for unemployment benefits fell to 233,000 in early August. These data eased market concerns about economic recession and prompted the market to gradually recover.
Geopolitical war uncertainty increases
After the top leader of Hamas was attacked in Iran last week, Iran threatened to retaliate against Israel. Although the action has not yet been implemented, the uncertainty of the situation in the Middle East has increased market concerns and put pressure on global markets.
US Democratic Party confirms candidate
After Biden announced that he would not run for election, the Democratic Party nominated the current Vice President Harris as the presidential candidate. Harris had initial contact with cryptocurrency industry executives. Although he did not make a clear statement, the market has new expectations for the Democratic Party's future cryptocurrency policy.
Altcoins of the Week
Overall performance
Market sentiment rebounded to 9.2% this week, but it is still in the extreme fear zone, which is significantly lower than last week's 12%. This change in sentiment is mainly due to the fact that the US employment data last Friday was far below expectations, which triggered market concerns about a future economic recession, leading to risk aversion and panic selling on Monday this week. Global markets fell sharply, and Altcoins generally fell by more than 20%. With the release of other macro data, recession concerns eased and the market began to rebound. However, the rebound of most tokens was not as large as the overall market, reflecting that investors are still cautious and take a wait-and-see attitude towards Altcoins.
Overview of the Rising Stars
The top 5 tokens with the highest growth in the past week (excluding tokens with small trading volume and meme coins), data source: Coinmarketcap
The list of rising tokens did not show the characteristics of "sector concentration". The rising tokens were scattered in various sectors, belonging to DEX, Depin, L1s, wallets and privacy tracks respectively. The market is still in a rebound.
Meme Token Gainers
Data source: coinmarketcap.com
After the market plummeted on Monday, the Meme track suffered a particularly serious decline, with projects falling by more than 30%. Although the Meme token rebounded with the broader market after Tuesday and outperformed other tracks, the gains of Meme tokens were not significantly outstanding.
It is worth noting that the speed of Meme themes’ replacement has accelerated. Although this appears to demonstrate its vitality and potential, it also exposes its instability and hidden concerns about its high replacement rate, which may lead to a lack of confidence among long-term investors, thus posing a challenge to the continued growth of the track.
Social Media Hotspots
Based on the top 5 daily growth in LunarCrush and the top 5 AI scores in Scopechat, the statistics for this week (8.3-8.9) are as follows:
The most frequently appearing theme is L1s, and the tokens on the list are as follows (tokens with small trading volumes and meme coins are not included):
Data source: lunarcrush and Scopechat
As can be seen from the table above, the L1s track projects that have attracted attention on social media this week have seen mixed rises and falls. Although some tokens have rebounded after a sharp drop, if the rebound is weaker than the overall market and there is no impact from special events, this may reflect the weak power of the funds behind them.
Subject tracking
Data source: SoSo Value
In terms of weekly returns, the Payment track performed the best, while the RWA track performed the worst.
Payment track: XRP is the main force of this track, accounting for 68.01% of the market value. This week, Ripple won the lawsuit against the SEC. The court ruled that the sale of XRP did not violate federal securities laws, and the amount of the fine was also less than expected. This positive news promoted XRP's strong rebound, driving the entire Payment track to perform well this week.
RWA track: Affected by expectations of a U.S. economic recession, stock and bond yields fell this week, resulting in the RWA track, which is mainly connected to real assets, to rebound the least and perform relatively poorly.
Crypto major events next week
Tuesday (August 13) FireNow: Asian Web 3.0 Institutional Summit
Wednesday (August 14) U.S. July seasonally adjusted CPI annual rate; Istanbul Blockchain Week 2024
Thursday (August 15) U.S. July retail sales monthly rate
Friday (August 16) OnChain Summit; ETHShenzhen 2024 Summit and Hackathon
Outlook for next week
Bitcoin: Although the recent U.S. economic recession expectations have eased, macroeconomic and geopolitical risks remain. Bitcoin is expected to continue to fluctuate widely before the Fed cuts interest rates. Investors should remain cautious, but can keep an eye out for rebound opportunities.
Ethereum: Ethereum spot ETF funds continue to flow in. Although there are bargain hunting opportunities in the short term, long-term risks remain. Ethereum is expected to fluctuate in sync with Bitcoin, and investors should be cautious about being bullish.
Altcoin: After the sharp drop this week, Altcoin is expected to rebound, but the increase may be limited. Investors should remain cautious and pay attention to market changes.
