In the crypto money ecosystem, which started 2023 with decreases, the first quarter made the investor smile. Supported by bank failures in March, Bitcoin approached the level of 30 thousand dollars and completed the first quarter with a 72% rise. The Shanghai Update is on the April agenda of crypto investors.
Up-to-date information about the first quarter of 2023 has started to be shared in the crypto money markets. Cryptocurrencies, which started the year with rapid declines, revived with the banking crisis that broke out in the USA as the end of the first quarter was approaching. While Bitcoin completed the first quarter of the year approaching the level of 30 thousand dollars, the rise in the cryptocurrency was 72% compared to the previous quarter. Sevcan Dedeoğlu, Research Manager of crypto asset trading platform Gate.io, shared his assessments for the first three months of 2023 and his predictions for the second quarter, which started in April.
Noting that the risk appetite of investors increased in the last weeks of the quarter, Sevcan Dedeoğlu said, “We have seen this not only in cryptocurrencies, but also in technology stocks, which experienced great value losses in 2022. The Nasdaq stock market, which mainly lists technology companies, increased by 17% in the first quarter.
Market capitalization of two major assets exceeds $750 billion
According to the table seen at the end of the first quarter, Bitcoin increased by 20,66% and Ethereum by 9,62% in March. Considered the two largest assets of the crypto money ecosystem, the total market value of BTC and ETH has exceeded $ 750 billion with current increases. Looking at the correlation used to determine the relationship of investor trends in different asset types and investment instruments, it was noted that the correlation between the S&P 500 and Nasdaq indices and Bitcoin was reduced to the 30% band, and the correlation between gold and Bitcoin reached the 50% level, the highest peak in 2 years.
Gate.io Research Manager Sevcan Dedeoğlu pointed out that the fact that cryptocurrencies act independently from established markets and stocks, and that their behavior differs with these investment instruments, is a good sign in terms of the nature and value promise of cryptocurrencies. and seen as a 'safe haven' by investors. We can explain the increase in correlation between gold and Bitcoin by saying that Bitcoin has become a 'safe haven' for crypto investors,” he said.
Bitcoin suppresses other cryptocurrencies
Bitcoin's dominance in the market also increased to 47%, showing that it suppressed other cryptocurrencies, the largest crypto asset called altcoins. Altcoins like Metis and Maker finished the quarter with losses of over 20%, while the number of active addresses on the Bitcoin and Ethereum networks increased by 10% and 5%, respectively. In this process, the crypto ecosystem, especially Ethereum investors, was locked on April 12.
April 12 critical due to Shanghai Update
The long-awaited Ethereum update, called Shanghai on the mainnet and Chapella or Shapella on the consensus network, will take place on April 12. This update means the unlocking of 2.0 million ETH worth $32 billion locked (stacked) for ETH 17,6. Noting that Ethereum is priced negatively against Bitcoin due to the expectation for this date, Sevcan Dedeoğlu concluded his evaluations with the following statements:
“Basically, two scenarios stand out. It is expected that Ethereum will try to test the $ 12 level as the price of Ethereum temporarily drops in the period after April 2 or the validators continue to lock down. After the Shapella update, JP Morgan's expectation for the ETH stake rate is that it will increase to 60%, while Messari's expectation is that it will increase to 30%. We anticipate that these expectations will have a positive impact on the Ethereum price in the medium and long term. We think that 'liquid staking' protocols such as Lotto Finance, Rocket Pool, and Frax Finance should be followed in the coming period. Operating with the motto of 'the door to crypto', Gate.io offers our users the opportunity to trade more than 1.400 cryptocurrencies, while making it possible for them to follow the latest developments in the market with our periodic investor summaries.”