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Good morning, and welcome to First Mover, our daily newsletter putting the latest moves in crypto markets in context. Sign up here to get it in your inbox each weekday morning.
Here’s what’s happening this morning:
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Market Moves: Bitcoin's price was holding steady, after the West announced stricter sanctions against Russia and its central bank over the weekend.
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Featured stories: The bitcoin market shows no signs of panic even as Goldman predicts high inflation and more Fed rate hikes.
And check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9 a.m. U.S. Eastern time. Today's show will feature guests:
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Kapil Rathi, co-founder and CEO, CrossTower
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Alona Shevchenko, founder, Ukraine DAO
Market Moves
By Omkar Godbole
Bitcoin posted moderate gains early Monday while traditional risk assets tanked on concerns that the West's stricter punitive sanctions on Russia will push the global economy into stagflation – a situation in which an economy experiences a simultaneous increase in price pressures and stagnation in growth.
The top cryptocurrency moved above $38,000, partially erasing Sunday's 3% drop. Meanwhile, the Asian and European stocks tanked and the Dow futures fell 800 points before regaining some poise.
The Russian ruble crashed 40% in Moscow, hitting a record low of 118 per U.S. dollar. The greenback gained ground across the board, with the money market showing signs of dollar funding stress.
The leading cryptocurrency remained resilient, perhaps having priced the escalation over the weekend. Crypto markets are open 24/7, contrary to traditional markets, which are available to trade five days a week.
Also read: Ruble-Denominated Bitcoin Volumes Surges to 9-Month High
Latest Headlines
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Ukraine Government Is Using Crypto Aid to Purchase Critical Supplies
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Russia-Ukraine Peace Talks Start in Belarus
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Bank of America Sees No Crypto Winter Given User Adoption, Developer Activity Growth
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UK Government Wants More Power to Seize Crypto Assets: Report
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Binance to Donate $10M to Ukraine Refugees, Opens Crowdfunding Project
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Bitcoin Resilient as Commodity Prices Inflate; Dollar Strength May Hurt
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Russia Banks Raise Key Rates by 20% in Desperate Measure to Save Ruble
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Central Bank of Russia Braces for Turmoil With Non-Resident Trading Ban
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Ukraine Asks Exchanges To Freeze Russian, Belarusian Crypto Accounts
Bitcoin shows no signs of panic
By Omkar Godbole
The worst-case scenario of high inflation and low growth while central banks prioritize consumer-price stability over economic activity and asset-price stability is increasingly looking likely.
Per James Pethokoukis, a columnist and an economic policy analyst, strategists at Goldman Sachs now expect four additional rates hikes in 2023 in addition to seven rate hikes this year. The investment banking giant previously anticipated three hikes next year.
However, the bitcoin market is showing no signs of panic yet, as evident from the blockchain data and derivatives market activity.
Data provided by blockchain analytics firm Glassnode show that the seven-day average of the number of coins held on centralized exchanges hovers near multi-year lows reached in the final quarter of 2021. That's a sign of solid holding sentiment.
