Bitcoin BTC Layer 2 Protocol Stacks, Ethereum ETH Staking Derivative Tokens Prices Rising

January’s euphoria in crypto markets turned to worry in February as investors drove down the prices of most major digital assets.

The pullback coincided with a buildup of worrying inflation and job data, starting with a lukewarm consumer price index (CPI) in the first half of the month and continuing with alarming stability in jobless claims and an even more alarming rise in consumer spending. It also came amid a flurry of regulatory action in the US raising concerns about government agencies going too far or misdirecting their efforts.

Bitcoin (BTC) recently traded flat from a month ago at around $23,080, though it was well below its mid-February highs above $25,000, 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 during the month, hovering just above $1,600. ETH rose more than 30% in January.

“I think the story of ETH withdrawals and the upcoming Shanghai update had a lot of people worried that those wouldn’t perform as well,” Katie Talati, head of research at crypto asset management firm Arca, told CoinDesk. “But many people have accrued income in fees they earned during this strike period.”

Bitcoin Layer 2 Protocol Stacks Network’s native STX token took the biggest winner’s trophy out of 160 assets in the CoinDesk Market Index, up 216% in February. The STX token started the month hovering around 27 cents and climbed as high as 95 cents on February 27 before pulling back slightly.

The STX price surge coincided with market participants’ growing interest in creating Ordinal non-fungible tokens (NFTs), which are NFTs on bitcoin enabled by so-called inscriptions on Bitcoin’s mainnet.

Arca’s Talati said the broader idea of ​​improving the Bitcoin network’s scalability has been around since Bitcoin’s Taproot upgrade — multiple signatures and transactions merged for better privacy and scalability — in November 2021.

But she added: “More information has become available in recent weeks about people buying and trading them more. Many people have said, ‘Well, if Ordinals do really well, it will give people a reason to use the Bitcoin network, which is why they should use Stacks.’”

Talati noted that there is no marketplace or infrastructure for Bitcoin NFTs yet. “People trade these Ordinals over-the-counter (OTC) using bid and ask spreadsheets.” she said.

Payment gateway Alchemy Pay (ACH) in the currency sector was the second-biggest winner of February, up nearly $170%. Adventure Gold (AGLD) and TrueFi (TRU) are up more than 50% this month, according to CoinDesk Indices. The CoinDesk Market Index (CMI) is up 3.3% this month.

Gaming and metaverse-affiliated tokens, which led January’s winner’s board, were among February’s biggest underperformers. GMT, the native token of the STEPN ecosystem in the culture and entertainment sector, fell 33% this month, while Gala Games’ native GALA token, which was up 233% last month, fell 28% in February.

Layer 1 Network Aptos’ APT token, which rose 387% in January, fell nearly 30% in February.

Vetle Lunde, senior analyst at crypto research firm Arcane Research, wrote in a weekly note that the recent ups and downs of tokens, saying that in three of the past four weeks, the “top 50 coin” winner has become from the previous week. the following week’s worst performer.

“Altcoin cycles are usually short-lived, but this is outside the norm and has all the hallmarks of a bored market chasing opportunity, in addition to the lack of new capital inflows,” he wrote, adding, “Poor liquidity facilitates this whimsical pattern, and you don’t want to be the one holding the bag when the music stops.






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