Bitcoin Pushes Higher (With 'Fake Grimacecoin') In Broad Crypto Rally

The latest moves in crypto markets, in context

January 26, 2022

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Good morning, and welcome to First Mover. Here's what's happening this morning:

Market Moves: Bitcoin was higher for a fourth day, in a broad crypto-market rally that saw gains in dogecoin (DOGE) along with this "fake grimacecoin."

Also: Wonderland's TIME tokens suffer another drop, this time to $420.

And check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9:00 a.m. U.S. Eastern time. Today's show will feature guests:

Today's newsletter was edited by Bradley Keoun and Shaurya Malwa.

Market Moves

By Shaurya Malwa and Bradley Keoun

Crypto markets were broadly higher on Wednesday, with bitcoin (BTC) gaining for a fourth straight day and pushing back up toward the $40,000 mark – a key psychological threshold that was ceded in last week's rout.

Prices of ether (ETH) and other major cryptocurrencies rose as much as 7% in the past 24 hours, with Polygon's MATIC tokens leading gains among members of the CoinDesk 20 list of digital assets. Dogecoin (DOGE) was a winner too, not to mention this "fake grimacecoin" created after a McDonald's joke tweet, which jumped as much as as 285,641%

Crypto traders were awaiting the Federal Reserve's latest decisions on monetary policy, with a statement due out from the U.S. central bank at 2 p.m. ET (19:00 coordinated universal time).

The pronouncement following the two-day, closed-door Fed meeting may reveal the bank's stance on the timing of an interest-rate increase that many observers expect will come in March. The Fed has said it will tighten monetary policy with up to four hikes this year to keep inflation in check, prompting a sell-off in asset markets across the globe during the last few months. Bitcoin fell as much as 25% in the past month, while the crypto market has lost upward of $1 trillion in market capitalization in the same period.

“If the regulator tightens its rhetoric and announces the upcoming rate hike as early as March, all risky assets, including cryptocurrencies, could suffer significantly,” Alex Kuptsikevich, a senior financial analyst at FxPro, said in an email to CoinDesk.

Several analysts and economists have suggested that dollar-denominated stablecoins might be the best place to hide out in digital-asset markets in 2022 if the Fed keeps tightening monetary policy this year, putting further downward price pressure on risky assets from cryptocurrencies to stocks.

Terra's LUNA tokens were among the only losers among major cryptocurrencies on Wednesday, posting a 4.6% decline, data from analytics tool CoinGecko showed.

Wonderland’s TIME Sets Low of $420 After Liquidation Cascade

By Shaurya Malwa

The past month has not been a good time for TIME. (Source: CoinGecko)

The TIME tokens from Wonderland, a decentralized finance (DeFi) protocol, slid to a record low on Wednesday, falling as much as 40% in 24 hours to just under $420 in Asian hours.

(TIME prices recovered in European morning hours, and were trading above $610 at the time of writing.)

TIME has lost 95% from its November peak of $10,000, becoming one of the worst-performing cryptocurrencies in the past few months during a broader decline that saw bitcoin, ether and other major cryptocurrencies reach prices last seen in mid-2021.

Last week, as reported by CoinDesk, Wonderland itself even stepped into the market to buy back TIME tokens to bolster the price.

Theories in crypto circles behind the latest sell-off included Wonderland developers selling part of their holdings and the unwinding of positions of overleveraged traders.

Wonderland’s TIME tokens are backed by a basket of assets issued over the Avalanche blockchain, giving the tokens an intrinsic value.

Wednesday’s plunge saw developers conduct a $5 million buyback during the Asian morning. “Looks like the bots and limit orders ran out of funds. I’m replenishing now and just did a $5mm buyback,” Wonderland developer Sifu wrote in a post on the project’s Discord channel.

Read the full story here: Wonderland’s TIME Sets Low of $420 After Liquidation Cascade

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Crypto Prices

Bitcoin (BTC)

See the latest price here

Ether (ETH)

See the latest price here

The following are the biggest movers in the CoinDesk 20 digital assets over the past 24 hours:

Biggest Gainers:

Biggest Losers:

Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive, and standardized classification system for digital assets. The CoinDesk 20 is a ranking of the largest digital assets by volume on trusted exchanges.

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ICYMI

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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.

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