Top Interest of the Week
Mantra ($OM) is a blockchain ecosystem designed to bridge the gap between traditional finance and decentralized technology. In February, the project team increased the total supply of OM from 888,888,888 to 1,777,777,777, minting the new OM coins directly on the MANTRA Chain. This adjustment in tokenomics raised significant concerns in the market, and a 90% drop occurred over the weekend following substantial transfers from wallets associated with the Mantra team and its investors to exchanges.
Orca ($ORCA) stands out as one of the pioneering general-purpose automated market makers (AMMs) on the Solana network. It allows users to swap assets, provide liquidity, and earn yields through a user-friendly interface. Recently, Orca's trading volume has exceeded that of Raydium ($RAY), making it the most active DeFi platform within the Solana ecosystem.
StakeStone, a DeFi platform that provides decentralized liquidity infrastructure, has initiated a new partnership with Sei Network ($SEI), an advanced Layer 1 blockchain aimed at enhancing DeFi applications and trading. This collaboration seeks to integrate StakeStone's cutting-edge omnichain liquid staking infrastructure with Sei's parallel-executing and high-speed environment. Additionally, the crypto project World Liberty Financial (WIFI), which the Trump family backed, has acquired more SEI tokens for its portfolio, prompting interest from investors.
Overall Market
Source: TradingView
The above chart is the BTC price in the daily candle chart at a log scale.
In our analysis last week, we maintained a neutral short-term outlook on Bitcoin (BTC) while adopting a bearish perspective for the next 6 to 12 months. This long-term bearish view was strengthened by BTC's failure to break through the $91,000 resistance level in March, along with the negative effects of President Trump’s reciprocal tariffs on risk assets. We will consider a more optimistic outlook only when the Federal Reserve indicates the end of its quantitative tightening (QT) phase and starts to ease monetary policy. However, recent events—especially the ongoing tariff headlines and Federal Reserve Chair Jerome Powell’s cautious approach to rate cuts—have reinforced our bearish stance, aligning with our assessment from last week.
The Consumer Price Index (CPI) report released last Thursday showed a slowdown in the inflation rate in the U.S., indicating a possible reduction in price pressures. However, this information is based on previous economic conditions and does not reflect the inflationary threats stemming from current U.S. trade policies. The tariffs enacted by the Trump administration are expected to intensify inflationary pressures shortly by raising the costs of imported goods. Additionally, the rising trade conflicts between the U.S. and its trading partners have created considerable uncertainty in global markets, leading investors to shift from riskier assets to safe-haven assets. This shift is exemplified by gold reaching a historic peak of $3,357 on Wednesday, highlighting the trend towards safety amid rising geopolitical and economic challenges.
On Wednesday, Fed Chair Powell gave a speech highlighting the Federal Reserve's desire for clearer economic indicators before making any changes to monetary policy. This hawkish stance, which suggests a hesitance to lower interest rates too soon, heightened market anxieties, resulting in a significant drop in U.S. stock prices after his remarks. In contrast to the overall risk-averse mood, Bitcoin (BTC) showed remarkable strength, maintaining solid support around the $83,300 mark. This unexpected stability in BTC's value is likely linked to the weakening U.S. dollar, as the U.S. Dollar Index (DXY) fell by 4% following President Trump’s detailed tariff announcements. A declining dollar typically enhances BTC's attractiveness as an alternative store of value, offering a temporary counterbalance to the prevailing bearish trends.
While Bitcoin (BTC) has shown resilience in the short term, our analysis suggests that this support is fragile and contingent on forthcoming bullish catalysts to sustain any upward momentum. The recent price action in BTC mirrors patterns observed in February, characterized by multiple long upside wicks on daily candles and price consolidation within a narrow range. This technical formation, coupled with a descending channel, suggests that resistance levels are progressively lowering, signalling potential weakness. Unless significant bullish developments emerge, such as a resolution to trade tensions or a dovish pivot from the Federal Reserve, we anticipate that BTC will retest the $82,500 support band in the near future.
Should BTC break above the $86,000 resistance, it could regain upward momentum and aim for the $91,000 resistance level. However, in the absence of such a breakout, we remain cautious and expect continued downward pressure on BTC's price in the upcoming days.
Macro at a glance
Last Thursday (25-04-10)
In March, the US headline Consumer Price Index (CPI) experienced a 0.1% decline, contrary to the anticipated 0.1% rise, leading to a decrease in annualized inflation from 2.8% in February to 2.4% in March. The core CPI also showed a lower-than-expected performance, registering a 2.8% annualized growth rate for March. However, this inflation data reflects past trends and does not account for the significant recent shifts in US trade policy. The market is anticipating an uptick in inflation in the upcoming months and is on the lookout for indicators of a potential shift in the Federal Reserve's stance.
Initial jobless claims in the US were reported at 223,000, aligning with market expectations.
Last Friday (25-04-11)
UK GDP experienced a monthly increase of 0.5%, surpassing the anticipated growth of 0.1%.
In Germany, the Consumer Price Index (CPI) continues to decelerate, showing a monthly growth rate of 0.3% in March, which corresponds to an annual growth rate of 2.2%. Both figures are slightly below those recorded in February.
In the United States, the Producer Price Index (PPI) recorded a monthly decrease of 0.4% in March, contrary to the expected growth of 0.2%. Additionally, the core PPI also fell by 0.1%, diverging from the forecasted increase of 0.3%.
The Michigan 5-year inflation expectation for April is estimated at 4.4%, while the 1-year inflation expectation is projected to reach 6.7%, marking the highest level since 1981. This forecast is considerably above the 5% inflation prediction made in March.
On Tuesday (25-04-15)
Canada's Consumer Price Index (CPI) experienced a monthly rise of 0.3% in March, falling short of the anticipated 0.7%. Meanwhile, the core CPI recorded a monthly increase of 0.1% for the same month, down from 0.7% in February.
On Wednesday (25-04-16)
In March, the UK Consumer Price Index (CPI) experienced a monthly increase of 0.3%, a slight decline from the 0.4% growth recorded in February. Year-over-year, the CPI growth rate fell from 2.8% in February to 2.6% in March.
Similarly, the Eurozone's CPI reported an annual growth of 2.2% in March, down from 2.3% in February. The core CPI also showed a decrease, with an annual growth rate of 2.4%, compared to 2.6% in the previous month.
In the United States, retail sales continued to rise, posting a monthly growth of 1.4% in March, surpassing the anticipated 1.3% increase. Core retail sales also exceeded expectations, recording a 0.5% monthly growth against a forecast of 0.4%.
The Bank of Canada has decided to keep its interest rate unchanged at 2.75%.
Federal Reserve Chair Powell indicated that the Fed would await further clarity on the economic outlook before making any decisions regarding interest rates.
Following Powell's speech, market sentiment turned negative as the likelihood of a rate cut in May decreased further. The US stock market experienced a significant decline, with the Nasdaq index falling by more than 4% intraday. In contrast, Bitcoin showed its resilience, finding robust support at $83,200.
Convert Portal Volume Change
The above table shows the volume change on our Convert Portal by zone.
The cryptocurrency market exhibited a strong correlation with the fluctuations of the US stock market, significantly influenced by developments related to tariffs. Recent data from the US CPI suggested a possible moderation in inflation rates, which typically would encourage a more optimistic outlook among investors. However, despite this potentially favourable information, market participants remained cautious. They were particularly focused on the likelihood of a policy shift from the Federal Reserve, understanding that any substantial positive sentiment in the market would likely depend on such changes being implemented.
In the Megadrop sector, robust demand for trading led to a 135.3% increase in trading volume, primarily driven by heightened interest in Lista DAO ($LISTA).
In the RWA sector, trading volume rose by 54.5% last week, largely propelled by strong market demand for Mantra ($OM).
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