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This Week In Crypto: Inflation Deceleration Sparks a Marketwide Rally

Story Highlights

The broader cryptocurrency market has staged a sharp comeback amid a wave of promising developments pushing the aggregate capitalization past $1.16 trillion compared to the prior week’s $1.05 trillion.

Bitcoin Breaks above Critical Resistance

After weeks of rangebound price movement, the value of Bitcoin (BTC-USD) has finally climbed past the longstanding resistance point of $24,000 and is currently trending just above the $24,500 mark. Over the past seven sessions, BTC’s value has risen by approximately 7.20%, with trading volume surging 53.20% during the last 24 hours. The value of BTC began its latest rally soon after the July CPI data revealed that consumer costs remained unchanged, putting U.S. inflation at 8.5%.

As Bitcoin’s price rebounds, the latest report from Glassnode indicates that investors are on an accumulation spree. As of August 10, the total number of BTC wallets holding more than 1 BTC jumped to a fresh all-time high of 894,303. That said, Bitcoin Dominance (BTCD) has dropped significantly this month and is now hovering around 40% – marking the lowest level since the outset of 2022. 

The latest data shows that altcoins are chipping away at Bitcoin’s market share. Furthermore, a Hashrate Index report underscores the extent that public BTC miners sold off their holdings, having dumped nearly 5,340 BTC in July alone. Although the comparable figures for the first week of August are still unavailable, the pace of disposal is rather glaring, given that the total amount mined in July amounted to 3,478 BTC.

‘Alt Season’ is Here as the Ethereum Merge Steams Ahead

Bolstering the ongoing marketwide rally, Ethereum (ETH-USD) has soared nearly 16.50% over the past seven sessions and is trading just shy of $1,900. Two factors have driven the upward momentum: first, the Ethereum development team has hinted that the much-awaited “Merge” will likely happen sometime between September 19-20. Additionally, the final phase before the merge, Ethereum’s Goerli testnet, which went live on Wednesday (August 10), also contributed to the surge in prices over the last 24 hours.

Among the top-ten altcoins, Polkadot (DOT) and Solana (SOL) registered impressive gains of 16.80% and 14.00%, respectively. The value of DOT gained steam after Web3 platform Alchemy announced an expansion of its infrastructure on Polkadot via a fresh deal with parachain Astar Network. Over the week, DOT has replaced Dogecoin (DOGE) as the 10th largest cryptocurrency by market capitalization.

After the latest wallet exploits severely dented confidence in the network, Solana (SOL) delivered an impressive comeback over the last seven sessions. The recovery from previous losses comes amid the launch of the latest NFT project, SolMad, and the expansion of Solana-based project StarGarden on Polygon. Mimicking the trend of BTC and ETH, other prominent altcoins like Binance Chain’s BNB and Cardano’s ADA also registered impressive growth this week.

Meanwhile, Avalanche (AVAX) rallied by approximately 26.20% this week after Robinhood (HOOD) decided to list AVAX on Monday (August 8). Other mid to low-cap altcoins like Near Protocol (NEAR), Chainlink (LINK), Cosmos (ATOM), Theta Network (THETA), Elrond (EGLD), and Quant (QNT) also registered double-digit gains this week.

Not to be outdone, this week’s biggest gainer was Flow (FLOW). Ranked 28th by market capitalization, the value of FLOW jumped by nearly 62% over the past seven sessions. The sharp rally comes at the heels of Meta (previously Facebook) adding support for the Flow blockchain as it expands its Instagram NFT feature to 100 additional countries.

Apecoin Slips below Key Support

With the broader market ascending, Apecoin (APE) was among the only major tokens underperforming the wider trend after remaining stuck in its horizontal trend. The value of APE dropped by nearly 3.10% this week despite the unveiling of a major deal with Gucci and a listing on payment service provider BitPay. 

Dogecoin (DOGE) also saw its position demoted after falling out of the exclusive list of top-ten cryptocurrencies by market capitalization this week. Even though the value of DOGE is moving upwards, having gained 7.50% over the past seven sessions, it wasn’t enough to fend off competition from Polkadot (DOT), which edged past DOGE in terms of market capitalization.

Reddit Partners with FTX & the U.S. Sanctions Tornado Cash

Prominent social media platform Reddit has revealed a new partnership with cryptocurrency exchange FTX, enabling Redditors to purchase ETH from supported apps via the exchange’s gateway FTX Pay. The partnership will extend to integrate FTX as the go-to solution for unlocking crypto-enabled perks in exchange for Reddit Community Points.

In the meantime, crypto platform Coinbase (COIN) reported its largest quarterly net loss since its Nasdaq debut in April 2021. Blaming the “fast and furious” downturn of the crypto market, Coinbase officials stated that the platform lost $1.1 billion during the second quarter. The platform’s shares remain under pressure as regulatory scrutiny and poor performance weigh on investor sentiment.

Finally, the United States Department of Treasury’s watchdog for countering sanction violations, the Office of Foreign Assets Control (OFAC), has placed sanctions on crypto mixer platform Tornado Cash, thereby prohibiting all American nationals from using the platform with immediate effect. The OFAC has further clarified that users found dealing with the platform will face criminal charges and penalties.

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