Market Wrap: Crypto Sell-Off Stabilizes Amid Bearish Sentiment

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Bitcoin (BTC) stabilized around $36,000 and was roughly flat on Friday. The cryptocurrency traded with lower volatility over the past 24 hours, compared with yesterday's sharp sell-off in price.

Alternative cryptos (altcoins) were also relatively stable on Friday, although GALA rose by as much as 9%, outperforming other tokens on the CoinDesk 20 list. Also, Algorand's ALGO token was up by 12% over the past 24 hours.

Choppy price action over the past week continued to reflect uncertainty among traders, especially as macroeconomic risks linger.

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On Thursday, the Bank of England (BOE) hiked interest rates and warned the public about an economic downturn. That triggered fears of stagflation, or high inflation and slow economic growth, among investors. The BOE's grim outlook was the opposite of the U.S. Federal Reserve's upbeat tone on Wednesday, which temporarily assured investors that U.S. economic conditions could withstand higher rates.

Ether (ETH) is down by 4% over the past week, compared with a 6% decline in BTC.

Typically, ETH underperforms BTC during down markets. This time, however, choppy trading conditions have capped the ETH/BTC ratio in a tight range over the past year. A decisive breakout or breakdown from the current range could confirm a risk-on or risk-off environment.

Overall, the shift from accommodative monetary policy to more restrictive measures has led to an unwind of speculative activity among global investors. That could be headwind for stocks and cryptos this year.

Over the short term, price action remains neutral, and some altcoins have benefited from brief price spikes.

Bitcoin, ether and gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the COMEX spot price. Information about CoinDesk Indices can be found at

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