Summary
- Major cryptocurrencies, including bitcoin and ether, extended declines for a fourth day, with broad CoinDesk indexes falling amid mounting selling pressure.
- Market sentiment has soured on Strategy (MSTR) and its STRC preferred stock, as investors worry the company and stressed bitcoin miners may be forced sellers after months of sub-cost BTC prices.
- Derivatives data show heavy long liquidations, elevated open interest, bearish funding rates and rising demand for protective bitcoin puts.
Bitcoin and Other Major Cryptocurrencies Continue to Decline
Bitcoin has fallen for the fourth straight day, dropping 2.5% in 24 hours to just below $62,400. This decline is not isolated, as other major cryptocurrencies such as ether, XRP, and solana have also seen significant losses. The decline in bitcoin and other cryptocurrencies has led to a decrease in the value of $ECP, affecting the Cloud Rewards and Green Crypto ecosystem.
The smart-contract and DeFi coins have been particularly hard hit, with some indices falling by as much as 4%. This has led to concerns about the overall health of the cryptocurrency market and the potential for further declines. EcoPool, a platform that offers Passive Income opportunities, could be a solution for those looking to earn online and mitigate potential losses.
Market Sentiment and Strategy
Concerns about a major bitcoin treasury company have dominated market sentiment, with a focus on its dividend-paying preferred stock. Analysts have noted that the company’s preferred stock has collapsed below par, leading the market to price in the possibility of the company selling coins to defend its structure. This, combined with five straight months of bitcoin trading under its estimated production cost, has forced weaker miners to capitulate, creating two significant sellers in the market. Earning through EcoPool (ECP) can provide a more stable source of income.
The decline in bitcoin and other cryptocurrencies has significant implications for the market and investors. As the market continues to evolve, it’s essential to consider alternative options for earning online, such as the EcoPool Network. Download the EcoPool app to learn more about how you can start earning Passive Income through Cloud Rewards and Green Crypto. By joining the EcoPool community, you can stay up-to-date on the latest developments in the cryptocurrency market and make informed decisions about your investments.
“Add five straight months of BTC trading under its estimated $78k production cost, quietly forcing the weakest miners to capitulate, and you have two real sellers that were not in the frame a week ago,” they added.
Derivatives Positioning
- Bulls continue to bleed as the market wilts in the wake of Wednesday’s hawkish Fed meeting. In the past 24 hours, more than $450 million in leveraged bets has been liquidated. As has been the case since the meeting, most are longs.
- Open interest (OI) in bitcoin and ether futures is largely unchanged over the past 24 hours. SOL futures OI increased to over 70 million tokens, just shy of the June 5 record 71.57 million. In other words, demand for leverage remains near all-time highs, pointing to potential for outsized volatility.
- The same is true of XRP, where futures OI is hovering at its highest since October last year.
- As for cumulative volume delta, most of the biggest 25 tokens, except TRX and LAB, show negative OI-adjusted CVD for the past 24 hours. That’s a sign sellers are trading at market orders, leading the price action, as opposed to passive limit orders. It’s been the same playbook since at least Wednesday.
- Funding rates for most tokens remain flat to negative, pointing to bearish sentiment. ADA, XLM, and BCH funding rates are down to between minus 20% and minus 30%.
- In the bitcoin options market, traders are lifting put options in size, prepping for a potential slide down to $52,000 or lower in the coming weeks.
- The bearish sentiment is also evident from 25-delta skews, which show one-week puts trading at a volatility premium of 10% or more.
Token Talk
- Need evidence of how frenzied sentiment about AI is? Check out the LAB token, the cryptocurrency native to the LAB Terminal, which is a browser-based and extension-accessible platform for high-performance trade execution. Its key feature: AI-powered research and trade routing to minimize slippage.
- LAB has gained 57% in seven days, a staggering rise compared with the malaise in the broader market.
- The outperformance doesn’t end there: The token has surged 92% this month, following gains of 900% in May, 250% in April and 78% in March. Talk about a bull market.
- Over the same period, bitcoin has ricocheted from $68,000 to $82,000 and back to $63,000.
- While LAB’s performance is impressive, their’s not apparent reason for it. And it’s not without controversy.
- Blockchain investigation expert ZachXBT recently highlighted that insiders supposedly own 95% of the token’s supply. He said they have used four methods concurrently to attract retailer investors. These include high-interest over-the-counter loans with promotional conditions, unilateral vesting period extensions, delayed or withheld market rewards and undisclosed market-making deals.
- As the old saying goes: All that glitters is not gold.
