Bitcoin holds up despite risk aversion as attention turns to Polkadot and Tether
The cryptocurrency market is holding its ground and the main tokens have not shown significant movements over the last few days, which is remarkable for analysts and investors in the midst of a renewed wave of risk aversion. The limited price action in Bitcoin and Ethereum reassures experts who believe that the consolidation that the major tokens have embarked on is a good sign and shows signs of resilience in the digital asset market. The focus on Monday is on Polkadot and the deal it struck with USDT stablecoin issuer Tether.
Given that Bitcoin is the quintessential risk asset, that it has weathered the market's ups and downs since leaving a three-month low last Wednesday "is quite surprising and perhaps even encouraging," commented Craig Erlam, analyst at Oanda. Despite the declines of the first half of last week, "key technical levels have not changed, as Bitcoin has ample support around $18,000-1$8,500 and the big test is not far below, at around $17,500, the low of early summer," the expert noted.
"Meanwhile, Ether is still dealing with the aftermath of 'The Merge'," the eToro experts pointed out, despite the fact that a consolidation of the price in the last five days is equally noticeable. All in all, these experts remarked that more than a week after the protocol change to proof of participation, the level of Ether issuance fell by around 98%, according to Ultra Sound Money. Whereas before 'The Merge', the network would have created more than 130,000 new ETH tokens in a week, in the 10 days since 'The Merge' only 8,000 have been created.
"The big question now is: why aren't we seeing a "deflationary" environment in the market? Overall, the network continues to create more ETH than it burns, at a ratio of two to one. But the level of new tokens coming onto the network has slowed substantially," commented Simon Peters, analyst at eToro.
As for other tokens, ADA remains around $0.45, with fluctuations between $0.44 and $0.48 and no noticeable change in price action despite last week's Vasil upgrade on the blockchain being a success.
Polkadot (DOT) is also noteworthy, as it is looking positive and leaving upside, buoyed by the news that Tether is now available on the Polkadot blockchain, providing investors with a stable coin on this network. This means that USDT can now be minted on the Polkadot blockchain.
Paolo Ardoino, Tether's CTO stated, "Polkadot is on a trajectory of growth and evolution this year, and we believe the addition of Tether will be essential to help it continue to thrive."