Daily News | BTC Continues to Fluctuate,; Runes Trading Activity Significantly Decreased; Layer 3 Will Release Token Airdrops; Wall Street Closed Higher

2024-05-13, 04:31

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## Crypto Daily Digest: Analysts believe that BTC will continue to perform negatively until June; The trading activity of Runes protocol has significantly decreased; Layer 3 will release token airdrops
First, let's take a look at the trading activity of <a href="/pt/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> ETFs. According to Farside Investor data, on May 10 (last Friday), Grayscale's Bitcoin spot ETF (GBTC) funds continued to <a href="/pt/price/flow-flow" target="_blank" class="blog_inner_link">Flow</a> out of $103 million; Meanwhile, Fidelity Bitcoin spot ETF (FBTC) inflow was $5.3 million, iShares Trust Bitcoin spot ETF (BITB) inflow was $12.4 million, and WisdomTree Bitcoin spot ETF (BTCW) net inflow was $600,000.

In recent weeks, the crypto market has entered a state of digital asset integration, which is a test of investor confidence. Charles Edwards, founder of crypto hedge fund Capriole Investment, released on Thursday that Bitcoin is currently in a "Bore you to Death" phase and expects this state to last for 1 to 6 months.

Previously, due to pessimistic expectations of inflation data and hawkish comments from Federal Reserve policymakers, the price of Bitcoin plummeted nearly 5% from $63,000 to slightly above $60,000. Blockchain activity data also shows low participation, a sharp decline in transaction volume on the Bitcoin network, and inflation in <a href="/pt/price/ethereum-eth" target="_blank" class="blog_inner_link">Ethereum</a>.

The current market performance is similar to the situation from April to September 2023, when the price of Bitcoin hovered in the range of $25,000 to $30,000 for an extended period of six months, and the market performance was worrying. However, in the end, the crypto market experienced several months of growth, and Bitcoin finally reached a historic high in March of this year.

Edwards explained that in this market stage, the price of Bitcoin will fluctuate within a low volatility range until market participants lose patience. He added that market sentiment may remain low until the consolidation is over. The lack of confidence in the market may be a strong signal approaching the bottom.

The ecosystem of the Runes protocol does not look optimistic either. The Runes protocol is a solution that can implement different token standards on the Bitcoin blockchain. It utilizes Bitcoin's UTXO model and OP_RETURN opcode to provide a more efficient Bitcoin tokenization solution than the BRC20 standard, making it the preferred choice for many memecoin trading activities on Bitcoin. Recently, it processed its billionth transaction.

However, the decline of the Runes protocol in the past two weeks was evident; Since the launch of the Runes protocol on April 19th, it has been active on the blockchain for three weeks, coinciding with Bitcoin's latest halving event. At that time, Runes attracted many excited investors to use it, and Bitcoin miners created extremely high transaction costs. In the first week, the Runes protocol generated over $135 million in Bitcoin transaction costs.

According to the Dune analysis dashboard compiled by Runes Is, trading activity has generally slowed since reaching its peak. On May 10, the activity level of the Runes protocol reached its lowest point, with the minimum number of new coins and wallets interacting with the protocol since its launch.

Based on The Block's data, it was also found that the fees generated by the Runes protocol steadily decreased, with total fees exceeding $1 million only twice in the past two weeks, indicating a decrease in trading and etching activity.

The Layer3 Foundation announced on the X platform that it will launch the token L3 in early summer this year, with 300 million pieces, of which community distribution accounts for 51% of the total supply. The detailed token economics will be released in June. Token holders can participate in governance and obtain product benefits constructed on the protocol through staking.

According to Layer3, "the initial airdrop will distribute 5% of the total L3 supply to early adopters and CUBE minters.” The company also stated in the post that "there will be multiple airdrops, and more details are coming soon."

The protocol aims to decentralize the $1 trillion "attention market" of Layer3. According to Layer3, it facilitated 96 million interactions in over 500 ecosystems.

Layer3 stated that "the opportunities for implementing crypto attention and identity infrastructure are enormous." The company aims to "provide identity and profit infrastructure for human and artificial intelligence agents as millions of ecosystems adopt token-based allocation models."

## Market Trends: The overall market is volatile, with 4 consecutive positive days on the PEPE weekly chart
BTC is still volatile, with continuous outflows of BTC spot ETFs and a lack of sustained hot spots. Currently, nearly 80% of mainstream computing mining machines in the market are around the shutdown price. On the macroeconomic front, US stocks rose, and the market is waiting for the CPI data on May 15.
### Market Hotspots:
The Meme concept leader PEPE continues to rise, achieving four consecutive positive days on the weekly chart. On-chain whales continue to buy PEPE.

<a href="/pt/price/gmx-gmx" target="_blank" class="blog_inner_link">GMX</a> surged after announcing the migration to the <a href="/pt/price/solana-sol" target="_blank" class="blog_inner_link">Solana</a> public chain. This week, the overall trading volume of Solana chain DEX exceeded the sum of five chains, including Ethereum, BSC, Arbitrum, <a href="/pt/price/optimism-op" target="_blank" class="blog_inner_link">Optimism</a>, and Base.

The re-staking track leader Eigenlayer token is now available for collection, and the estimated market cap of over-the-counter futures is $12 billion, with the possibility of starting trading at the end of September. In addition, Puffer Finance announced that staking EIGEN to its platform can earn Puffer points.

Bouncebit token BB will be launched at Gate.io at 18:00 today. BB is a BTC re-staking protocol, and they plan to launch a stablecoin similar to Ethna. Bouncebit's current TVL is $1 billion, and BB issued a total of 2.1 billion. The market predicts its valuation to be around $2 billion. Three months ago, Bouncebit's VC round financing was valued at $60 million.

The crypto market is undergoing volatile adjustment, and investors should remain cautious, especially when dealing with highly volatile assets. Investors are advised to closely monitor market trends, especially the performance of Meme coins. At the same time, users should strengthen risk management, adjust investment strategies promptly, and make corresponding decisions based on market changes.

## Macro: Wall Street closed higher before the release of inflation data; Asian stock markets climb to a 15-month high
Last Friday, Wall Street closed higher, and the market was optimistic about profit expectations. On May 10, the US stock market saw a slight increase as investors analyzed comments from Federal Reserve officials and looked forward to essential inflation data next week. All three major stock indices showed a weekly upward trend. The S&P 500 index and Dow Jones index slightly rose, while the Nasdaq index remained essentially unchanged. The blue-chip stock index hit its most significant weekly increase since mid-December.

Regarding the three major indexes, the Dow Jones index rose 0.32%, the S&P index rose 0.16%, and the NASDAQ index fell 0.03%. Regarding the upcoming end of the first quarter financial reporting season, according to data from LSEG, out of the 459 companies in the S&P 500 index that have already announced performance, 77% of the companies have performed better than market expectations.

Analysts predict the key CPI report may show a year-on-year increase in core prices to 3.6%. In addition, a preliminary assessment of consumer confidence by the University of Michigan in May showed that US consumer confidence experienced its largest monthly decline since August 2021, reaching a six-month low, while recent and long-term inflation expectations have risen.

On Monday, Asian stock markets climbed to a 15-month high. As before, the market is closely monitoring this week's inflation data, which may determine the hope that the United States will cut interest rates early. At the same time, China's economic activity data will also test the optimistic sentiment of the global economy's sustained recovery.

Beijing stated that the inflation rate rebounded to an annual rate of 0.3% in April, which helps alleviate concerns about being trapped in long-term deflation. It is expected that the April retail sales and industrial output data released on Friday will further increase.

In addition, the Chinese authorities plan to sell 1 trillion yuan (approximately $138.24 billion) of long-term bonds to support domestic stimulus spending. Although sentiment improvement helped push Chinese blue chip stocks to a seven-month high, they fell 0.1% on Monday due to reports that the White House is about to announce new tariffs on Chinese goods, putting pressure on some sectors.

The MSCI Asia Pacific Stock Index is currently slightly up 0.2%, rising for three consecutive weeks. The Nikkei index in Japan remained unchanged, still facing the possibility of further interest rate hikes due to the decline in the yen. Meanwhile, on Monday, the Bank of Japan reduced the amount of Japanese government bonds purchased through routine operations, sending a hawkish signal to the market and pushing up yields.

According to a Reuters survey, the Bank of India expects inflation to return to its target of 4% in the next quarter and will also cut interest rates then. However, due to good economic growth, the Bank of India may hope to wait for the Federal Reserve to cut interest rates before taking action to prevent the rupee/dollar exchange rate from falling to historic lows.

Regarding commodities, oil prices fell last week due to increased US gasoline and distillate inventories. Brent crude oil prices fell another 22 cents to $82.57 per barrel, while US crude oil prices fell 17 cents to $78.09 per barrel.

The price of gold rose by 2.5% and then slightly fell to $2,358 per ounce due to demand from momentum funds and rumors of sustained buying from China.

<div class="blog-details-info">
<div>Author:**Sherry S. & Icing**, Gate.io Researcher
<div>Translator:Joy Z.
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>

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