First Mover Asia: Pine wants to test the liquidity of the NFT market; Cryptos are good red

The number of users in NFT markets is at its lowest level this year, but still higher than in 2021. The crypto lending platform sees an opportunity.

Hello. Here’s what happens:

Price: Bitcoin and other cryptos coincide with stocks.

Insights: While interest in the NFT market has fallen sharply in recent months, crypto lending platform Pine sees an opportunity.

Technicians’ opinion: BTC is testing a key support zone, although long-term momentum remains weak.

Prices

Bitcoin (BTC): $28,967 -5.3%

Ether (ETH): $1,941 -7.4%

The biggest winners

There are no winners in CoinDesk 20 today.

The biggest losers

Possess teleprinter Return DACS sector
Peas POINT −13.5% Smart contract platform
polygon MATIC −13.5% Smart contract platform
internet computer PCI −12.9% computer use

Cryptos are falling with stocks

It was a red Wednesday for almost everyone in crypto.

Red for bitcoin. Red for ether. And an even deeper red for other major altcoins as investors continued to challenge those who say digital assets are not keeping up with stocks.

Bitcoin recently traded at around $28,900, within its range of recent days following the collapse of the stablecoin terraUSD (UST) and the LUNA token that backs it, but fell 5% in the past 24 hours. Ether, the second-largest cryptocurrency by market cap, lost more than 8% over the same period after dropping below $2,000. From the rest of the decline and lapse, SOL, AVAX, DOT, MATIC, SAND, and MANA have all fallen by at least 12% recently.

“The market is continuing its current bearish course,” Autonomy CEO James Key wrote to CoinDesk, though noting that crypto wallet addresses with small amounts of BTC hit 10 million for the first time. Still, he noted that “institutions… view crypto as an exotically high-risk asset, and as we enter a recession, these assets are the first to be sold by these players – that was always the downside of them.” room.

Equity markets had a more than memorable day as all sectors collapsed on growing investor fears of a recession and bad retail news. The tech-focused Nasdaq fell 4.7%, while the S&P 500 fell 4%, its worst percentage drop in two years. The Dow Jones Industrial Average plunged more than 1,100 points, a 3.6% drop that was its worst closing figure since mid-2021.

Retail played a major role in the most recent economic recovery in the United States, and even last week the sector looked good after a strong consumer spending report. But on Tuesday, retail giant Walmart said its profits fell 25% year-over-year. Target followed up Wednesday morning with its own disappointing news: Revenue rose just 3.3%, compared to a 22% increase for the same quarter a year ago.

Bitcoin, which struggled to hold onto $30,000 after the UST debacle, and the rest of the digital asset industry has been swept up in the latest events. On Wednesday, London-based miner Argo Blockchain reported net profit of $2.1 million in the first quarter, down 90% year-over-year.

Meanwhile, Mike Novogratz, CEO of cryptocurrency merchant bank Galaxy Digital (GLXY.TO), said in a letter posted on the company’s website that the company was taking profits before the UST crash. Pantera Capital also sold about 80% of its holdings, according to a New York Times report citing investor Paul Veradittakit.

While Novogratz remained very optimistic about the cryptocurrency’s prospects, he said those hoping for a “V” bottom in the market will likely be disappointed. “Restructuring, a buyout cycle, consolidation and renewed trust in crypto are needed. Crypto moves in cycles and we just witnessed a big one. †

markets

S&P 500: $3,923 -4%

DJIA: 31,490 -3.5%

Nasdaq: 11,419 -4.7%

Gold: $1,816 +0.1%

Knowledge

Crypto Lending Platform Pine Sees Opportunities in NFT Markets

The art that adorns the walls of the global elite is usually not just to look at. They also use it as a source of money.

The team behind the Pine protocol proposes doing something similar, but for non-fungible tokens (NFTs). After closing a $1.5 million financing round led by Sino Global, Amber and Spartan Group, Pine is building a platform that will give NFT holders access to liquidity by using their NFT as collateral, and a mortgage-like vehicle that will ” Pine Now, Pay Later”. for those who want to buy an NFT but need financing.

“A year ago I wanted to buy a Meebit, but I didn’t have any extra ETH in my wallet. So I sold my Bored Ape Yacht Club (BAYC) for 7 ETH to complete the trade. I wanted to buy another BAYC but never did and I still have my Meebit now. Looking back, I wish I had access to a platform like Pine,” Pine co-founder Alex Ho said in a statement, illustrating a use case for the platform. “I decided to develop Pine so that NFT owners like me could unlock cash without having to sell their NFTs.”

The platform offers loan pools with different conditions regarding loan interest, the level at which it will be liquidated if the value falls, and the level of collateral, Ho told CoinDesk in an interview.

One particular factor that differs between pools is the accepted loan-to-value ratio. Pine uses the floor price (the lowest price offered) of the specific set of NFTs from public data released by the markets as a measure of valuation. But these are subject to the intense volatility of the cryptocurrency market. For example, in the past two weeks, ether has fallen nearly 27% against the US dollar, causing valuations to plummet – problematic for those lending dollars against the asset.

How much liquidity is actually available in this market? Twenty thousand dollar JPEGs are largely the product of a bull market cycle, but will the same sense of value be prescribed to them in a bear market?

Data from cryptocurrency research firm Nansen suggests that the number of wallets being bought and sold is declining, and the number of repeat buyers and early buyers is also declining.

“The number of projects with weekly sales of more than 10, 100, 1K and 10K NFTs has also fallen over the past week, indicating that overall liquidity in NFT markets is declining,” said Martin Lee, a data journalist. at Nansen, in a note to CoinDesk.

The number of transactions per week is 50% below a record high this year, from about 500,000 at the peak to about 215,000.

But Lee also pointed to data showing weekly user numbers in NFT markets are at their lowest this year, but still higher than ever in 2021.

Nansen’s data shows that weekly volume is still higher than it was in most weeks of 2021, and in the past 30 days, volume is up 58% from 941,000 air spend per month to 1.49 million.

For Pine, expensive JPEGs – with all their questions about market volatility and liquidity – are just the beginning. The founders foresee that their asset-backed financing protocol will eventually be extended to other vertical markets by specialized teams outside of this market.

In theory, NFTs can be used to represent any type of document of value, such as a home title or a security agreement to fund an investment in a company like a SAFT. After all, similar vehicles exist in the world of traditional finance, and there’s no reason the same couldn’t happen for cryptocurrency — if the industry can pass JPEGs of bored monkeys.

Technician’s opinion

Bitcoin’s daily chart shows support/resistance. (Damanick Dantes/CoinDesk, TradingView)

Bitcoin (BTC) has been trading in a narrow range between $27,000 and $30,000 in recent days. This is an important support zone for BTC and it is also the lower end of a one-year trading range.

BTC is down 3% in the past 24 hours.

A decisive break below $27,000 could set further downside targets for BTC, initially towards $17,823. In addition, BTC’s downward descending 50-day moving average points to continued weakness in the trend, which could keep sellers active.

Bitcoin is facing strong resistance between $33,000 and $36,000, which could block a price surge. On the weekly chart, momentum remains negative despite oversold readings. This could increase the risk of a price breakout, similar to what happened in March 2020 and November 2018.

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