First Mover Asia: We’re Still Missing Good Web3 Games; Bitcoin Swoons Below $29K

Good morning.

Here’s what’s happening:

Prices: Bitcoin lost the mojo it regained on Tuesday, dropping below $29K; ether fell toward $1.9K.Insights: Valuations for some Web3 games are higher than the lifetime revenue of some successful, traditional gaming companies, and yet Web3 doesn’t have many games that make players enthusiastic.PricesBitcoin’s Wednesday Swoon

What happened to bitcoin’s Tuesday mojo?

The largest cryptocurrency by market capitalization tripped early Wednesday, falling first below $30,000 for the second time in three days, and hours later below $29,000 for the first time in more than a week. BTC was recently trading at about $28,930, down about 4.6% from Tuesday, same time, and far from its heights last week when a moderately encouraging Consumer Price Index and renewed investor optimism buoyed markets.

Investors’ mood soured on Wednesday after a sobering U.K. inflation report and massive sell order on Binance. «One way or another, the hot UK CPI report that we got in today’s European session made the market more vulnerable, and may have been the piece of macroeconomic data that pushed that large seller to pull the trigger, which led to a cascade of sell orders as we dropped below 30,000,» Matt Weller, global head of research at online broker Forex.com, told CoinDesk TV’s «First Mover» program.

Ether continued its mirroring of BTC this week, falling around 7.1% to trade at around $1,945. The second largest crypto in market value topped $2,100 on Tuesday after tumbling on Monday along with most other, major altcoins. The second largest crypto in market value had been on an upswing in the days following the much ballyhooed Ethereum Shanghai upgrade, the final step in the platform’s shift from a proof-of-work to more energy efficient proof-of-stake protocol.

APT, the token of layer 1 blockchain Aptos, and ARB, the native crypto of layer 2 blockchain Arbitrum, recently plunged about 10% and 13%, respectively. The CoinDesk Market Index, a measure of the crypto market’s overall performance was recently down 6.2%.

Equity markets traded roughly flat for a second consecutive day with the tech-heavy Nasdaq Composite rising 0.03%, but the S&P 500, which has a strong technology component dropping 0.01%. Investors have continued to digest unexpectedly strong first quarter earnings from the financial services sector, although a number of regional banks have yet to report. Their results will offer additional clarity on the banking sector’s health.

In an email to CoinDesk, Markus Levin, co-founder of XYO Network, a cryptography-backed oracle network that anonymously collects and certifies data with a geographic component, noted «a tremendous amount of anxiety in the market right now, particularly when it comes to macroeconomic conditions.»

«The UK’s higher-than-expected inflation numbers seem to be hitting a bit too close to home, both in the U.S. and in other countries where monetary policy is tightening and fears of a recession are growing,» Levin wrote. «It seems as though all these macroeconomic concerns may finally be catching up with Bitcoin.

He added that after bitcoin’s strong gains in recent weeks, «it’s not surprising to see consolidation. Crypto markets have always been particularly susceptible to price fluctuations, so none of this should be cause for panic.”

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