Daily Brief - Crypto Quake

TLDR: This past weekend, Bitcoin experienced its most significant price drop in over a year. What happened?

Recent escalating geopolitical tensions in the Middle East have heightened risk aversion among investors, affecting not just cryptocurrencies but global stock markets. Traditional safe-haven assets such as bonds and the U.S. dollar saw increased demand last week.

Adding to the pressure on Bitcoin and other digital currencies was the significant liquidation of bullish bets. According to Coinglass, approximately $1.5 billion in crypto derivatives were liquidated over the weekend, marking one of the heaviest two-day liquidations in recent months.

Looking ahead, the cryptocurrency community is eyeing the upcoming Bitcoin halving event expected on April 20. This event has historically been a bullish catalyst for the token's price but current market conditions bring some skepticism about the potential impact of this halving.

Investors are now keenly watching how traditional markets will respond as they reopen today. While crypto prices reversed some losses, the future direction may hinge on whether geopolitical tensions escalate further or stabilize.

Scenario Spotlight: Impact on Bitcoin

The chart above displays the historical one-month response of Bitcoin, based on the past 35 instances when Bitcoin and the S&P 500 fell by 4% and 1.5% respectively in a single day.

Market Movers: Impact on Altcoins

Here is the historical 1 month response from altcoins when Bitcoin and SPX both fall in a single day:

1. USD Coin: -0.01%
2. Tether: -0.02%
3. Ethereum: -2.91%
4. XRP: -5.03%
5. Binance Coin: -8.72%
6. Dogecoin: -10.78%
7. Cardano: -12.42%
8. Chainlink: -14.04%
9. Solana: -18.13%
10. Avalanche: -23.11%

Earnings Spotlight: Goldman beats earnings estimates

Goldman Sachs reported first-quarter earnings that exceeded analysts' expectations, with a profit and revenue boost driven by increased trading and investment banking activities.

The company announced earnings of $11.58 per share, significantly higher than the expected $8.56 per share, according to forecasts by LSEG. Revenue reached $14.21 billion, also topping the anticipated $12.92 billion. The bank attributed its 28% profit rise to $4.13 billion to a rebound in capital markets activities.