Bitcoin Drops Under $40k While Ether Stands its Ground at $2,600 Amidst NFT Craziness and Ahead of EIP-1559 Activation
Bitcoin has recovered well in the second half of July, climbing to $42,500 last week after ten straight days of green candles. This price level hasn’t been seen since late May.
This week, however, is starting at a slightly red note, with Bitcoin going under $40k.
Still, BTC/USD is just 38.8% down from its all-time high of almost $65,000 in mid-May as we make our way back to the ATH.
Interestingly, it is Ether that has been the star of the last week and is continuing that momentum into this week.
Ether is currently trading above $2,600 after touching nearly $2,700 on Sunday. Ether now has 13 green candles in a row, while Bitcoin has made a hattrick in red candles.
During April to June drawdown, Bitcoin had crashed about 55.7%, and Ether fell harder by 61.2%. Despite this, thanks to the latest rally in Ether’s price, it is now only down 40.3% from its May peak.
ETHBTC has also been moving up since last week, currently up above 0.066 from 0.057 on July 28. The next resistance for this pair is at around 0.069.
ETH has been rallying due to two reasons, and DeFi isn’t either of them though DeFi market cap has increased by over 40% to above $90 billion in the past two weeks. ETH locked in DeFi is also on an uptrend since late June, now at 9.65 million ETH, as per DeFi Pulse.
The most important reason for this uptrend is the London Upgrade which is coming this week. It could either be August 4 or 5 at block 12,965,000. This could very well turn out to be a buy the rumor, sell the news event given the way Ether has been enjoying the gains this past week.
The most anticipated EIP in this upgrade is 1559, which will burn the base fee paid in ETH, making Ether effectively a deflationary asset. This is also expected to create a positive feedback loop for price hence the excitement.
Another reason is NFTs, which are back in action.
In the past 7-days, NFT marketplaces saw immense growth. CryptoPunk had a sudden jump in both volume and traders by 1260% and 340% repetitively, as per Dapp Radar. While CryptoPunks did nearly $122 million in volume, OpenSea got back at the top with almost $180 million volume. Axie Infinity is also near, at $171.4 million in volume.
The floor price of CryptoPunks, along with other NFTs, also went up crazy last week, with CryptoPunk #9778 having the latest top sale for a whopping 300 ETH worth $769.43k.
DAILY. FLOOR. UPDATE. I legitimately have updated this SEVERAL times while making it because the god damn floors keep moving. WHAT IS HAPPENING. This is the craziest 24-48hrs probably in NFT history. The amount of money that just flowed into the space is ABSURD. And.. just the pic.twitter.com/jcopztFxjH
— Zeneca_33 🍌 (@Zeneca_33) August 1, 2021
So, the excitement around NFTs and this mania taking up the entire crypto industry along with seeing real mainstream adoption, but more importantly, EIP 1559 getting activated this week is making people load up on Ether.