A breather in a healthy bull market
The mood in the crypto market is subdued. Not because prices are plummeting, but mainly because stocks and gold keep hitting all-time highs each week. Over the long-term though, the outlook still looks promising. In this Market News, we'll also cover Plasma, a new blockchain focused on stablecoins.
Market update
The crypto market has significantly underperformed compared to stocks and precious metals in recent weeks. The broad US stock index S&P 500 and gold have been setting record highs for weeks, while the price of most cryptocurrencies continues to decline. This disparity is creating a somber mood among crypto investors.
Looking at the Bitcoin chart from a distance, however, there's little reason for despondency. Since the bear market low in November 2022, the price has followed a steady upward trend. The dominant 55-week moving average has supported a series of higher highs and higher lows.
At ā¬95,500, theĀ bitcoin price currently is right in the middle of a broad range between ā¬85,000 and ā¬106,000. The average has reached the support zone at the lower end, and only a weekly close below that level would call for a rethink. Until then, the bull market remains intact, and the base case scenario is that the price breaks out of this range to the upside.
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Plasma and stablecoins set the tone
Stablecoins are playing a major role in the crypto market this year. Their importance is visibly growing: from stablecoin issuers' stock market plans to new initiatives from banks, asset managers, and fintech companies. Tether is strengthening its position and looking to expand in the US. Circle is building bridges to traditional financial markets. For anyone following the sector, itās obvious - stablecoins are increasingly becoming the foundation upon which new applications are built.
Against this backdrop, the launch of Plasma attracted attention this week. This new blockchain network is fully focused on facilitating stablecoin transactions, with free USDT transfers and over a hundred DeFi integrations from day one. While many networks profile themselves with technical innovation, Plasma opted for a clear narrative: the network for digital money. And it was a hit.
The introduction of Plasma and the XPL token was striking. Shortly after launch, the price peaked around $1.50. Early adopters who bought their tokens for 5 cents, saw a significant increase in value. In addition, active users of the network received a generous airdrop reward, resulting in widespread visibility on social media.
The big question is whether Plasma can maintain this strong start. In the short term, attention is partly fueled by recent price developments and price predictions. But the underlying trend, the growth of stablecoins, is structural. As stablecoin use increases, so does the demand for efficient infrastructure. Plasma has sensed this momentum and is now well-positioned.
That said, it remains important to keep new projects in perspective. The stablecoin infrastructure market is still in its early stages, and further innovation and competition are expected. Even so, with a clear focus and strong first steps, Plasma has already established itself as a serious player in this growth segment.
Other news
Tether is seeking new capital at a $500 million valuation. According toĀ Reuters, the largest stablecoin issuer aims to raise $15 to $20 million in a private round. This would place Tether in the top tier of tech giants. The move not only underscores USDT's profitability but also its ambition to become a global financial infrastructure. Whether investors will accept that price tag remains to be seen.
Nine European banks, including ING and UniCredit, are joining forces for a euro stablecoin.Ā The consortium aims to launch a MiCA-approvedĀ alternative in 2026 to challenge the dollar-dominated market. The currency is issued through a new entity in the Netherlands and is intended to become a trusted, regulated means of payment. The market is doing what Brussels is failing to do: putting Europe on the map in a playing field dominated by American stablecoin giants.
Wall Street can no longer ignore crypto,Ā GSR Research wrote this week. Analysts observe that every corner of Wall Street isĀ moving towards crypto. Vanguard, Morgan Stanley, JPMorgan, Citi, Schwab, and Visa are taking concrete steps: from crypto ETFs to spot trading and bitcoin rewards. This is no longer about promises, but about large, traditionally conservative players responding to customer demand and competitive pressure.
After massive corruption protests, the Philippines launches a blockchain platform.Ā Integrity Chain records public-sector spending expenditures and contracts to make phantom projects and overpriced contracts harder to hide. It's a striking move: citizens demanded transparency through protests, and now the government is turningĀ to blockchain as a weaponĀ against corruption.
Satoshi Radio: InĀ the latest episode of Satoshi Radio, you get an in-depth update on the bitcoin price. It seems to be slowly trending downward. What's going on? We'll also review the latest news, including a Dutch bitcoin reserve, the crypto industry going public, high-profile perp exchanges, and a stablecoin from nine European banks.
This article is for informational purposes only and does not constitute a marketing communication or recommendation. None of the content herein should be considered as investment advice or a substitute for it. Bitvavo makes no guarantees regarding the accuracy or completeness of the provided information. Investments involve risks. There is a possibility of losing your entire invested capital.