BTC and ETH Market Analysis
Bitcoin (BTC) Performance
- The weekly downtrend paused mid-week with a minor rebound, but Friday’s CPI release triggered an immediate sell-off.
- Key Data: May's CPI surged 8.6% YoY, the highest since December 1981. Core inflation (excluding food/energy) rose 6%, exceeding expectations.
- Price Action: BTC dropped below $29,300, with dominance climbing to 48%. ETH/BTC pairs hit lows last seen in April 2018.
Ethereum (ETH) Updates
- Ropsten Testnet Merge: Developers successfully merged PoW and PoS chains, with the mainnet merge planned for late 2022.
- stETH/ETH Liquidity Crisis: Large lending platforms faced stETH redemption demands, destabilizing Curve’s stETH/ETH pool (75% stETH). Lido’s stETH remains 1:1 backed by ETH, enabling future redemptions post-merge.
- Opportunity: Secondary market volatility allowed buying stETH at a discount.
LINK Staking Announcement
- Roadmap: Chainlink’s staking will roll out in phases (v0.1, v1, v2), starting with a 5% LINK reward system for node operators.
- Price Impact: LINK surged 30% post-announcement.
Derivatives and Options Market
- CPI Fallout: BTC/ETH options remained stable despite spot market sell-offs, suggesting bearish sentiment was priced in.
- Volatility Shift: Implied volatility spiked—ETH’s 1-week IV jumped 57% (81% → 127%), BTC’s rose 46% (66.3% → 97.1%).
- Skew: 25D volatility skew widened, reflecting heightened downside panic.
Market News and Highlights
Regulatory and Macro Trends
- Russia proposed a ban on crypto payments.
- Leaked U.S. bill suggests DAOs and stablecoin providers must register.
- Bitcoin miner revenue dropped 55% from November 2021 peaks.
Ecosystem Updates
- Celsius holds 1M ETH, but only 26.8% is liquid.
- BlueYard Capital raised $185M for Web3/early-stage investments.
- Tron’s reserve bought $50M in BTC/TRX.
- Optimism recovered 2M OP from Wintermute.
- NEAR integrated Multichain for cross-chain interoperability.
Price Movements
- ETH/BTC ratio fell 12.1% weekly.
- ETH dropped below $1,600, with only 55% of addresses profitable—a 22-month low.
Traditional Markets
- CPI Shock: Equities plummeted—Dow (-4.58%), S&P 500 (-5.06%), Nasdaq (-5.70%).
- Fed Pressure: Expectations for 50 bps rate hikes intensified.
FAQ Section
1. Why did BTC drop after the CPI report?
The higher-than-expected inflation data (8.6% YoY) fueled fears of aggressive Fed rate hikes, prompting risk-off sentiment across crypto and equities.
2. Is stETH safe despite its depegging?
Yes, Lido’s stETH is 1:1 backed by ETH. Post-merge redemptions will restore parity, making current discounts a potential buying opportunity.
3. What’s next for Ethereum after the Ropsten merge?
Developers target a mainnet merge in late 2022, with the difficulty bomb delayed to August.
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Disclaimer: This content is for educational purposes only and not investment advice. Comply with local regulations and assess risks independently.
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