Why Bitcoin, Ethereum, and Dogecoin Slipped Over the Weekend

In the cryptocurrency world, Bitcoin (CRYPTO: BTC), Ethereum (CRYPTO: ETH) and Dogecoin (CRYPTO: DOGE) remain three of the most-watched tokens for good reason. Unfortunately, onlookers have seen mostly downside price action over the weekend. Since market close on Friday, these three top digital assets have sunk 4.2%, 2.5% and 11.2%, respectively, as of 12:45 p.m. ET on Monday.

An initial sharp decline was seen in all three tokens in early Saturday trading, in line with the reported escalation of the ongoing conflict between Iran and Israel. While each of these three tokens has made up some of this weekend’s initial losses, it’s clear that cryptocurrency is not immune from the geopolitical forces driving capital in and out of assets in times of uncertainty.

These moves are also significant because they come ahead of this week’s expected Bitcoin halving, in which block rewards for miners will be cut in half. Typically, previous halvings have resulted in a booming price, which has bled into other crypto assets as well.

But given the anticipation around this rise, as well as capital inflows into spot Bitcoin ETFs, some investors appear to be betting that much of this rally might have already taken place, leading to caution heading into this key catalyst.

Let’s dive into some other key factors to consider when it comes to these three top tokens and their price action today.

Why all the negativity in the large-cap crypto space?

Bitcoin’s move is perhaps most important to watch, as the largest cryptocurrency in the world heads into its latest halving, expected to take place on or about April 20. We’ll have to see how the network responds, and how investors value the network as its inflation rate is halved yet again.

The fact that Bitcoin did not rise on increased Iran-Israel tensions suggests that investors are continuing to view it more as a risk asset and less as a hedge against uncertainty. We’ll have to see if this narrative shifts, particularly if some response from Israel is seen in the coming days.

Ethereum’s move, while negative, has been the strongest of the three over the weekend. This is likely due to news that the Securities and Exchange Commission (SEC) has approved applications from three Chinese companies to list Bitcoin and Ethereum spot ETFs in Hong Kong.

No official report from the SEC has been released, but this could signal that a spot Ethereum ETF approval in the U.S. is likely to be seen in short order. For now, overarching macro concerns appear to be stealing the spotlight from this otherwise positive catalyst. I would expect Ethereum to continue to outperform its fellow large-cap tokens in the coming weeks, as investors price this catalyst in.

Dogecoin’s double-digit move lower over the weekend once again exemplifies this token’s nature as a high-risk and high-leverage bet on momentum within the crypto space. A lack of any meaningful rhetoric from Elon Musk (and negative sentiment building around Tesla and its recent layoffs and full self-driving announcements) have investors seemingly looking for other options in the crypto realm right now.

Is there upside on the horizon this week?

Certainly, there are a number of bullish catalysts that could take these three top tokens higher this week. The Bitcoin halving and the reported approvals of spot Ethereum ETFs should be broadly bullish for the top two cryptos by market capitalization (and Dogecoin by default).

The thing is, uncertainty remains high right now, and investors remain on edge waiting to see if we’re heading into yet another war. The feeling in financial markets is glum right now, meaning these catalysts could be overshadowed by this overarching sentiment, at least in the short term.

It will be interesting to see how these top tokens perform next weekend, as additional news arises around the two aforementioned key catalysts every crypto investor is watching right now.

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Chris MacDonald has positions in Ethereum. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Tesla. The Motley Fool has a disclosure policy.

Why Bitcoin, Ethereum, and Dogecoin Slipped Over the Weekend was originally published by The Motley Fool


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