03/01/2023
January euphoria in crypto markets turned to February worry as investors sent prices of most, major digital assets lower.
The retreat coincided with a cascade of concerning inflation and jobs data, starting with lukewarm consumer price index (CPI) data in the first half of the month and continuing with an alarming steadiness in jobless claims and an even more alarming rise in consumer spending. It also came amid a flurry of regulatory action in the U.S. that raised concerns about government agencies overreaching or misdirecting their efforts.
Bitcoin (BTC) was recently trading flat from a month ago at about $23,080, although it was well down from its mid-February highs above $25,000 mark, according to CoinDesk data. The largest cryptocurrency by market capitalization rose about 40% in January.
Ether (ETH), the second-largest crypto by market value, also traded sideways for the month to hover just over $1,600. ETH rose more than 30% in January.
With Ethereum’s upcoming Shanghai upgrade, markets’ interest in liquid staking derivatives soared, with LDO, the governance token of the decentralized autonomous organization behind liquid staking provider Lido surging 33% for the month. Its rival Rocket Pool’s native RPL token rose 18%.
I think the narrative of ETH withdrawals and the Shanghai update that's coming made a lot of people worry that those wouldn't perform as well,” Katie Talati, head of research at crypto asset-management firm Arca, told CoinDesk. “But a lot of people have accrued revenue in fees that they've earned over this staking period.”
