Welcome to another edition of Qume Market Mondays!
Crypto markets rallied last week with Bitcoin and Ether up around 8% and 32% respectively while traditional markets closed on weekly losses. The gold market is also booming but we suspect it may not be good news for the world economy.
Trading volumes are back to normal levels as market activity picked up, this Ether dominated rally picked up bitcoin too to cross the $10,000 levels.
However, as crypto markets rallied, the correlation between Bitcoin and S&P 500 weakened as the later closed on losses.
The sudden surges in Ether prices may not be that surprising at all. After all this year Defi industry has seen significant growth and all of it is built on Ethereum.
The total locked-in Defi value just hit an all-time high of $3.3 bn. It has increased more than 3x this year. Total value locked in Uniswap also crossed $100 M mark.
This has had a significant impact on the Ethereum network as well. Transaction activity picked up on Ethereum, raising transaction costs which are keeping out small players to get in on the Defi bandwagon. Vitalik — One of the founders of the Ethereum network said that this makes Ethereum less secure.
The total number of Ethereum addresses are growing faster than they have for a long time. Although, it is still below the growth rate seen during the 2017 boom.
Since the spot volumes of Ether have increased, the collateralization levels of Maker DAO have also been increasing since last week.
U.S.-China tensions escalate
Earlier last week, the U.S. ordered China to close its Houston, Texas consulate on accusations of economic espionage and visa fraud.
China also retaliated by ordering the U.S. to close its Consulate in Chengdu, China.
The threat of a rising dispute between the U.S. and China has gold prices moving higher.
XAU-USD Gold spot reached an all-time high level of $1900 per troy ounce last week.
As uncertainty in the world markets grows investors worry about the sustainability of their investments in stocks and bonds. As the yield on government bonds continue to drop, Gold is supposed to rally further during the pandemic.
However, a spike in the trading prices of the yellow metal has a whole different meaning for the crypto community as it is generally seen as a bullish indicator.
AMD vs Intel
The balance of power in the semiconductor business has swung from Intel to AMD as Intel’s shares went down around 16%, while AMD surged 16% higher after Intel announced its next generation of advanced chips would be delayed. Investors fear it may take years for Intel to make up the lost ground against AMD.
Coming up this week:
Major finance and tech industry giants are all set to report their second-quarter results this week including, AMD, Apple, Alphabet, Facebook, Visa, Mastercard and PayPal. This will offer unique insights into some of the biggest companies in the U.S.
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Other data sourced from skew.com