Has the crypto decline stopped and Elon Musk is back on dogecoin


Cryptocurrencies have taken centre stage for all the wrong reasons lately, most notably their decline in value. Of course, despite this, the industry continues to grow. eToro’s Simon Peters gives us his weekly update on all things crypto.

Crypto asset price declines come to a stop

The high-speed decline of crypto assets over the past two weeks appears to have come to a stop for now. 

Bitcoin saw a major sell-off last week, having started above US$33,800 before reaching as low as US$26,350 on the eToro platform on Thursday. The coin recovered some ground over the weekend however and is now trading between US$29,000 and US$30,000.

Ether likewise saw its value plummet from around US$2,500 to below US$1,800 before rebounding to now trade around US$2,000.

These falls cap a week many have now described as the beginning of a “crypto winter.” But with the so-called death spiral now halted, investors will be keen to see if tokens can maintain their price levels for the next few days at least.

The last time the market faced adversity like this was the collapse of 2018. But the makeup of the market is very different today than four years ago. Institutional investors now make up a much bigger proportion of the market, which has already had an observable impact on not just prices, but the way the market moves.

What investors will now be considering, is how these players will help support levels moving forward. With deals from major global financial institutions going ahead (see Goldman/Barclays and Emirates stories below), the potential is there for the sector to keep bubbling away, despite difficulties around valuations.  

Goldman Sachs (NYSE:GS) and Barclays buy into project

In a positive sign for long-term investors in the crypto space, Goldman Sachs and Barclays have just tied up a deal to invest $500 million in Elwood Technologies – an institutional crypto investment platform.

The firm, founded by billionaire Alan Howard, is focused on providing crypto investment solutions to institutional investors and comes despite widespread market troubles in recent months. A series of other venture capital firms including Dawn Capital and Galaxy Digital (TSX-V:GLXY).

The move is an interesting moment in the market, beset by the noise of turmoil in crypto prices. It shows that behind the scenes the work of major institutional players is going ahead despite the adversity. 

Major movers and shakers such as Goldman and Barclays are clearly looking at the growing relevance of institutional crypto investing and the growing trend that has changed the nature of the crypto market in the past two years. Retail investors are no longer alone in seeing the value of the sector and in the background, long-term investor plans are still being built. 

Elon Musk talks dogecoin, again

Elon Musk has pronounced on dogecoin again. The billionaire tech investor commented on a tweet from the co-founder of dogecoin, saying he believed it could still function as a currency. 

The comment comes despite major adversity for the token which has seen its value plummet 66% in the past six months. The token reached as low as US$0.07999 but has bounced on Musk’s comments to trade around US$0.08639 now, an 8% bounce back. 

While it will take more than Elon Musk to shift dogecoin from its current position to a viable digital currency, adoption is underway with his firm beginning to accept the crypto asset for certain memorabilia products. 

Musk has also suggested Twitter could accept payments in dogecoin and also that he will work to combat crypto scams and other issues on the Twitter platform, which could be a boon for the sector. 

Emirates to begin accepting crypto

Middle Eastern airline Emirates has said it will begin accepting bitcoin as a payment for flights, as it moves to embrace blockchain, NFTs and the metaverse. It is now the largest such airline in the world to make the move into accepting bitcoin. 

The airline is at the forefront of crypto developments in the airline industry and has an extremely progressive and innovative approach to incorporating the technology into its business. 

The firm has said it will soon begin a hiring spree to attract crypto talent to help develop its projects. Bitcoin will for now function as a payment service for the firm – akin to paying using PayPal or another online payment service. The firm will convert bitcoin back into fiat currency in receipt.

While not supporting the overall price of the crypto, it will help support activity on the bitcoin blockchain and promote its use as a payment method, a growing area for bitcoin which is often forgotten amid discussions which tend to focus on price.

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