$6 billion in its crypto burns, Katie Haun raises $1.5 billion for cryptocurrency startups, and Goldman Sachs makes the first over-the-counter Bitcoin trade
Volatility in the cryptocurrency market is nothing new, but worldwide uncertainty makes crypto more unpredictable than usual. And experts predict that volatility will continue for some time yet.
The war in Ukraine, which has resulted in more than 1.2 million Ukrainians fleeing the country and over 2,000 Ukrainian civilians being killed, is one of several underlying causes for the increasing volatility in cryptocurrency and stock markets. Although the cryptocurrency market has been volatile, it has also seen significant growth and widespread usage in recent years. Its increased penetration and tightened ties to the stock market make it even more entwined with international conflict.
The recent drop in bitcoin’s price has also been attributed to rising inflation, which was touched on by the Federal Reserve earlier this month when it said it would raise rates for the first time since 2015. Bitcoin’s price is currently trading at around $40,000, with a target of reaching $45,000 — a level it hasn’t reached since
For the first time since March 1, the price of Ethereum has exceeded $3,000.
Still, it quickly dropped below $3,000 on Wednesday as traders anticipated the company’s crucial software upgrade to Consensus Layer. In addition, the term “merge” has been used by investors and builders (previously “Ethereum 2.0”). It is expected to happen in the next few months, either way. Experts advise against making investment decisions based on news-driven panic or hype.
Meanwhile, Ethereum has spent almost $6 billion on its cryptocurrency since last year. Katie Haun became the first person to raise $1.5 billion for a pair of crypto-focused VC funds when she completed her fundraising effort. Goldman Sachs became the first central U.S. bank to offer bitcoin over-the-counter, and it was one of the first financial institutions to do so.
Here’s what investors should take from this week’s cryptocurrency news:
According to Watch the Burn, a cryptocurrency data dashboard, the platform has reduced the amount of new currency issuance by 65% since August last year. That’s almost $6 billion worth of Ether destroyed, removed, and taken out of circulation. It’s part of a larger plan to upgrade the blockchain network to its Consensus Layer, formerly known as Ethereum 2.0 while restricting cryptocurrency miners’ earnings per transaction.
Katie Haun, a crypto investor and entrepreneur, has raised $1.5 billion for her newly launched firm that focuses on digital currency.
According to Pitchbook, it’s the most significant initial fund ever raised by a solo entrepreneur, and it is also the first-ever received by a lone woman venture capitalist. The company’s stock price has climbed dramatically, demonstrating investor excitement about Web3, which is generally defined as the next phase of the internet based on blockchain technology.
In the United States, Goldman Sachs became the first central bank to conduct an over-the-counter cryptocurrency trade.
This week, the bank traded a Bitcoin non-deliverable option. According to a press release, this derivative pays out in cash and is linked to Bitcoin’s value with crypto bank Galaxy Digital. It’s another significant development in the growth of crypto markets for institutional investors.
Bitcoin is the most valuable cryptocurrency by dollar value, and it’s an excellent predictor of the crypto market as a whole because other coins like Ethereum (as well as smaller altcoins) tend to mirror its movements. Despite Bitcoin’s recent record-breaking all-time high, the crypto market is notorious for its unpredictability, so this was quite typical. While these swings might be expected, they shouldn’t be taken lightly by investors.
Expert investors urge against making significant investment adjustments due to these typical fluctuations. Cryptocurrency is still in its early stages, and while there are many variables to consider, one thing remains consistent: innovation and regulation can significantly influence investors.