Last week, Bitcoin (BTC) and Ethereum (ETH) experienced a lull in price growth after posting modest gains the previous weekend. Bitcoin remained around the same level as the previous weekend at $28,820, a 5% decrease from its April high of $30,979 but still up 77% from $16,615 at the start of January 2023. Ethereum added 4.2% to its value over the seven days and was trading at $1,885, a 7% decline from its 2023 high of $2,129 set in mid-April and 66% up from January 1 when it was valued at $1,197.
TRON saw the most growth last week and was the only top thirty cryptocurrency to grow by 8% over the week, trading at $0.070261 at the start of the weekend. All other leading cryptocurrencies remained relatively stable over the last seven days, with little movement in their values.
The lack of growth in the crypto market last week is partially attributable to the US Federal Reserve’s decision to increase interest rates by another 25 basis points to combat inflation, the tenth consecutive hike since March of the previous year. In macroeconomic terms, interest rate hikes tend to drive investors away from riskier assets such as stocks and cryptocurrencies, as the cost of borrowing increases and money becomes more expensive, discouraging speculative investments.
On Tuesday of last week, the White House released a report reinforcing the idea of a Digital Asset Mining Energy tax (DAME), which would apply to miners of both proof-of-work and proof-of-stake cryptocurrencies, starting at a 10% tax on their electricity costs in 2024 and increasing each year until it reaches 30%. Despite having different energy consumption levels, the tax would apply to both types of miners.
The proposal has already met with strong opposition from the cryptocurrency industry since it does not take into account the sources of energy used by the mining companies. Critics argue that the US government is making a judgment on the energy consumption of cryptocurrency mining as an inherently negative activity, without considering whether a miner uses renewable forms of energy or not.
A 2024 presidential hopeful for the Democratic Party, Robert F. Kennedy Jr., tweeted on Tuesday that he believes there is a top-down “war on crypto” that has something to do with the recent collapses of the Silicon Valley Bank, Silvergate, and Signature. Kennedy had earlier posted a lengthy rant on Crypto Twitter, railing against the idea of a dollar-pegged cryptocurrency being released by the Federal Reserve. Kennedy’s thread was based on a misreading of an article about the Fed’s new digital payments system FedNow, which has nothing to do with central bank digital currencies (CBDCs).
In the Republican camp, Florida Governor Ron DeSantis, who is widely expected to run as a presidential candidate in the next elections, again voiced his opposition to CBDCs at a press conference on Tuesday titled “Government of Laws, Not Woke Politics.” DeSantis criticized the environmental, social, and governance (ESG) approach as “virtue signaling” and connected the concept of a CBDC to ESG’s “woke” practices by arguing that CBDC advocates “will impose ESG and social credit scores onto that, and that’s going to be a huge reduction in freedom for people in this country.” His remarks echo earlier statements in which he described a US CBDC as “Big Brother’s Digital Dollar.”
In adoption news, famed auction house Sotheby’s launched an on-chain NFT marketplace for secondary NFT sales on Monday of last week, enabling collectors to list and make offers on work from artists. Argentine cryptocurrency fans fear they could be witnessing the start of a crackdown on digital currencies there, as the country’s central bank banned payment platforms from offering cryptocurrency trading services to their customers on Friday last week.