This Week in Coins: 2023 Green Streak Continues for Bitcoin, Ethereum, Solana, Avalanche

This week in coins. Illustration by Mitchell Preffer for Decrypt.

Knock on wood, but it is two weeks into 2023 and the green shoots of crypto have not yet been cut.

None of crypto’s top 20 coins posted substantial losses this week. Bitcoin (BTC) and Ethereum (ETH) rose higher after encouraging signs that US inflation slowed in December.

BTC pushed past $19,000 on Thursday for the first time since just before the FTX collapse in early November, thanks to news from the Bureau of Labor and Statistics that inflation had slowed to 6.5% for December, down from 7.1% the previous month. Markets (both stocks and crypto) were clearly suggesting that the Federal Reserve could soon slow down its relentless escalation of interest rates to counter rising prices.

On Friday night, BTC continued its rally, crossing the $20,000 mark and erasing its FTX-induced losses. It’s on 23% in the past week to $20,899 at the time of writing, according to data from CoinGecko.

ETH saw similar gains and rose steadily from Wednesday based on inflation reports. The world’s second-largest cryptocurrency rose an encouraging 21% over the week, crossed the $1,400 mark Thursday and sitting at $1,538 on Saturday morning. ETH hadn’t seen such highs since November 8, when FTX collapsed, bringing the crypto market down.

Equities fared similarly, with the S&P 500 and Nasdaq both posting their best weekly performances since November.

While crypto traders were certainly welcome to ride the Wall Street wave, others advised caution.

“It is a worrying trend to see Bitcoin catching up with traditional financial indicators and stock markets,” said Stefan Rust, CEO of Laguna Labs. Decrypt earlier in the week. “As we know, Bitcoin was created as an alternative financial system to Wall Street, and it feels like we are losing our way.”

Meanwhile, the week’s biggest gains rose on crypto-specific news that was independent of macroeconomic trends.

AVAX, the native token of the Avalanche blockchain, skyrocketed a whopping 29% on Wednesday alone on news that developer Ava Labs will soon be offering crypto infrastructure through a partnership with Amazon Web Services. The development will see Amazon use its dominant position to drive Avalanche adoption across the public and private sectors. AVAX ended the week up 44% from Saturday morning.

Lido, the liquid staking protocol, saw similar notable gains for Lid this week, thanks to encouraging developments on the Ethereum network.

Since the Ethereum fusion Moving Ethereum to a proof-of-stake system in September, network participants have been able to earn newly minted ETH as a reward for staking pre-existing ETH with the network. Lido is a leading service that allows users to pool and stake their ETH to earn more; over $7 billion in ETH has been staked through the project.

But these users have not yet been able to withdraw their wagered ETH. That opportunity comes with Shanghai, an upgrade to the Ethereum network that is well on track for a March launch. With the core developers of Ethereum do not report any problems with the rollout of the update, LDO shot up 41% this week.

And then there is Solana. After a brutal end to the year due to its close ties to the FTX ecosystem and Sam Bankman-Fried, SOL is on a comeback: it is up 65% over the past seven days to $22.54 as of Saturday morning.

Stay up to date with crypto news and get daily updates delivered to your inbox.

Leave a Comment