The rally in the crypto market is stumbling, following stock markets as there are no real fundamental drivers to support it. Instead, there are many negative factors surrounding the market now connected to the high interest rates that the Federal Reserve (Fed) has set on the highest level for the last 15 years, and layoffs by big techs.
Some investors are taking into consideration the less hawkish comments made by the Fed’s Chief Jerome Powell, as well as the monetary watchdog itself, after it raised interest rates only by 25 basis points in February. However, the Fed continues with its monetary tightening as high inflation still dominates the economy and recession fears are still very much present. Perhaps, interest rates would rise at a slower pace, but it would not mean they will not be on high levels for quite a long time. The recession may come gradually so there may not be time for complacency as the debt yield curve is inverted and bubbles in the real estate market are threatening the economy amid rising borrowing costs.
Balance co-founder, Ric Burton, accused Uniswap crypto exchange founder, Hayden Adams, of violating his obligations as Burton owed money to Adams for supporting Uniswap and helping it get off the ground. Burton said he gave $25,000 to go towards the team of developers during Uniswap’s infancy without any written obligations. He also claimed that he introduced the Paradigm investment. Burton said that Adams had verbally agreed to repay him from Uniswap’s investment funding. In this case the potential share of Burton could be at $18 million. However, there are minor chances that Burton can get any kind of compensation from Uniswap.
Fox Sports has banned any crypto advertising during the upcoming Super bowl, the most wanted sporting event for advertisers. Last year they spent $54 million for advertising during the event, including FTX crypto exchange that collapsed recently.
Nevertheless, a new rally in the crypto market could emerge sooner or later and investors are looking for the drivers that may indicate this. Primary blockchains are unlikely to become such a driver. Investors were betting on native tokens, like Solana, Avalanche, Near, Harmony, Fantom, Elrond, Polkadot, and some others, hoping that they may become the new and better Ethereum with advanced technology. But project teams were mostly seeking security and community, and not to replace other cryptocurrencies. So, few investors are using the networks of these projects now. Second layer blockchains, like Optimism, are getting more attention now, while large projects, like dYdX, are focused to only use their own networks. So, second layer project tokens could become growth drivers as they may rally faster than any infrastructure project tokens.