Sam Reynolds considers a rising trend of crypto startups postponing their token launches, part of the fallout from the collapse of crypto exchange FTX and its trading arm Alameda Research.
Prices: Bitcoin shifted from flying high above $25K to sinking to $23.6K over the course of Thursday.
Insights: Alameda Research ranked among the crypto industry’s largest market makers. Its collapse with its parent company FTX, has increasingly prompted startups to postpone their token launches.
Bitcoin was rising again Thursday and then it wasn’t as investors seemed to have second thoughts about persnickety inflation, Fed monetary policy and crypto industry woes.
The largest digital asset by market capitalization was recently trading at about $23,618, down 4.8% over the past 24 hours and well off its high earlier in the day above $25,100. That mark represented BTC’s first sojourn above $25,000 since August, reflecting rising optimism about inflation and the economy. But both seemed to vanish in the space of a few hours as an unexpected 0.7% month-over-month spike in January’s Producer Price Index (PPI) suggested that the U.S. central bank monetary had not yet succeeded in taming price increases that have bedeviled the economy for more than a year.
Industry-specific problems during the day also offered a reminder that crypto itself remained on rocky ground as investment bank D.A. Davidson analyst Chris Brendler downgraded Coinbase (COIN) to neutral from buy; a New York judge overseeing the criminal fraud case of Sam-Bankman Fried warned he might revoke the bond of the former CEO of disgraced crypto exchange FTX if Bankman-Fried continued to defy bail conditions; and decentralized finance (DeFi) protocol Platypus Finance suffered a flash-loan attack with a potential loss of $8.5 million.
Other cryptos turn red
Ether followed a similar path to BTC, rising well above $1,700 for the second consecutive day before retreating. The second largest crypto by market capitalization was recently changing hands at about $1,650, down more than a percentage point. Other major cryptos also seesawed with APT, the token of layer 1 protocol Aptos, recently sinking 7.9% after rising more than 9% earlier in the day. MATIC, the native crypto of layer 2 blockchain Polygon Network was up over 6.3%, despite paring gains from earlier. Popular meme coins DOGE and SHIB were both firmly in the red a day after rising handsomely.