Ripple, Dogecoin Edge Higher, Ether Burn Falls to Record Low
Bitcoin (BTC) soared past $87,000 this Monday, marking a bullish start to the week for major cryptocurrencies. Alongside Bitcoin, solana (SOL), xrp (XRP), and dogecoin (DOGE) each gained more than 4%. Traders are now closely monitoring upcoming U.S. economic data for guidance on potential market movements.
Over the weekend, Bitcoin fluctuated around $85,000, held down by growing inflation concerns and uncertainties surrounding the U.S. economy. Notably, SOL surged ahead, recording a 5% increase in the last 24 hours, while tron’s TRX experienced a setback, dropping 4% after a recent surge tied to memecoins (source).
The persistent risk-off sentiment is slightly alleviated by reports suggesting that the upcoming U.S. tariffs due on April 2 may be less aggressive than previously anticipated. Nick Ruck, director at LVRG Research, noted, “Investors are remaining cautious on the upcoming price moment due to the uncertainty.” The financial community is particularly focused on this week’s upcoming U.S. economic reports, which will include consumer confidence, personal spending, and PCE data—important indicators that can have significant repercussions on crypto markets.
Consumer confidence levels indicate the optimism of Americans towards the economy. A higher confidence typically correlates with increased consumer spending, which fuels economic growth. Conversely, a low confidence level may suggest a shift toward saving rather than spending. PCE (Personal Consumption Expenditures) is a crucial inflation metric that reflects changes in the price of goods and services.
Strong consumer confidence and spending could potentially boost crypto prices, as increased disposable income allows for greater investment in riskier assets. However, should PCE rise significantly, indicating inflation, it might lead investors to consider cryptocurrencies as a hedge against a weakening dollar. Conversely, falling confidence and decreased spending might signal economic downturns, leading to investor caution and declining crypto prices.
Despite caution in some circles, others assert that the U.S. economy may be faring better than perceived. Augustine Fan, head of insights at SignalPlus, indicated in correspondence with CoinDesk, “U.S. ‘hard’ economic data remains robust and in contrast with the soft sentiment, suggesting an over-extrapolation of the current weakness versus underlying fundamentals.”
Market metrics for cryptocurrencies, including Ethereum’s performance, exhibited parallels to recent stock market actions, with price movements largely range-bound. Fan remarked that Ethereum is stabilizing around significant support levels, currently sitting at the high end of its 2022 range, with critical support identified around the $1,500 mark.
Starkly contrasting Ethereum’s outlook is its recent performance in terms of transaction burning, with activity at one of its lowest points seen in recent months. A burn refers to the permanent removal of tokens from circulation, initiated in August 2021 with Ethereum’s EIP-1559 upgrade when the network began burning all base transaction fees. This past Sunday witnessed only 50 ETH burned—almost a 99% drop from the peak of 71,000 ETH burned on May 1, 2022. The downward trend in daily burns, previously oscillating between 500 to 3,000 ETH, illustrates a significant decline in transactional activity, as users gravitate towards less expensive alternatives such as Solana and Tron.
