Jakarta, CNBC Indonesia – Cryptocurrency prices have strengthened throughout the week, especially Ethereum touched new record highs, accompanying higher yields (yield) the benchmark government bond of the United States (US), although then gradually weakened by the end of the week.
The Bitwise 10 Index, which records price movements of 10 major cryptocurrencies in the world, was recorded to have weakened 0.8% in trading Thursday (1/4/2021) to 82.69. The weakening occurred amidst the digital currency’s correction.
However, on a weekly basis, the position on Thursday is still up 6% compared to last Friday’s closing at the level of 78. Since trading on October 15, 2020, the index has shot up 550%.
The increase in the crypto index occurred on Monday to the level of 81.4 and continued a day later to 84, which is also the highest position in a week. The increase accompanied the yield on the 10-year US government bond from 1.721% (Monday) to 1.726% (Tuesday), reaching a week high on Wednesday at 1.746%.
Investors increasingly believe that cryptocurrencies are an alternative asset to hedge (hedging) their wealth from the scour of inflation. Therefore, the crypto rush occurs when inflation expectations are high due to an economic recovery that is believed to be getting closer following US President Joe Biden’s US $ 2 trillion vaccination and infrastructure program.
When inflation increases, debt market players also release US government bonds and choose to use the fresh funds to buy the latest series of bonds that will offer higher yields (to compensate for rising inflation). As a result, bond prices were depressed and yields increased.
In the Bitwise index, Bitcoin accounts for 75% of its market capitalization followed by Ethereum at 13%. The remaining 12% comes from other cryptocurrencies such as Polkadot, Binance Coin, Tether USD, Cardano, XRP, Terra, Uniswap, and Wrapped Ether.
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Sumber: Refinitiv- – |
Bitcoin today, Sunday (4/4/2021) is traded at the level of US $ 57,419.99 per unit, or down 2.13% from Saturday’s position at US $ 58,669.5 per unit. This position is further away from its all-time high on March 13, 2021, amounting to US $ 61,606.06 (Rp.895.6 million).
Ethereum money also weakened to the level of US $ 2,011.9 per unit, after on Friday this week it touched its highest level in history at US $ 2,090.8 / unit.
CNBC INDONESIA RESEARCH TEAM
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