Cryptocurrencies retreat from cloudy macroeconomic outlook

A large chunk of cryptocurrencies retreated last week as dark macroeconomic clouds affected sentiment, until recently heading in the opposite direction.

Bitcoin started the week around $30 but traded down for most of the week, despite a brief jump above $300 on Thursday. Cryptocurrency dropped on the platform eToro and is currently trading at around $29.

Ethereum posted a similar decline, starting the week around $1 but declining in the meantime to now sit around $920.

Macro factors affect bitcoin

The US released a mixed set of unemployment figures last week. This seems to have somewhat affected the earlier enthusiasm of major cryptocurrencies like bitcoin.

While the labor market weakens and employment slows down, unemployment in the world's largest economy is still at its lowest level in many decades. While that's not bad news per se, it does suggest that the Federal Reserve may have more momentum to raise interest rates further and hold them higher for longer.

The pace of interest rate increases last year had a very strong impact on the cryptocurrency markets and led to significant volatility. So far, the market environment has been much more stable this year, but investor anxiety is unlikely to subside anytime soon - at least until the overall picture of inflation normalizes.

Rumors about the BRICS currency and its importance for cryptocurrencies

Over the weekend, rumors surfaced online about a potential gold-backed BRICS currency that would challenge the dollar's dominance in the global market. While actual confirmation of such a move is yet to come, US Treasury Secretary Janet Yellen was forced to respond at a press conference in Beijing.

"Dedollarization" and the emergence of an alternative to BRICS has become a major internet topic in recent months and is widely discussed in the cryptocurrency community. Major crypto assets such as bitcoin are affected as they are seen by many investors as a kind of "third way" in the global game for supremacy between fiat (and even gold) currencies.

On the BRICS issue, however, nothing concrete has emerged yet. And although the dollar is no longer in the position it once was, it is still a long way from relinquishing the crown as the global reserve currency. However, crypto-assets will react to changes in this area, as they are a natural alternative to national currencies, in particular bitcoin, which is completely decentralized.

The Shiba Inu blockchain is set to launch in August

Cryptoasset Shiba Inu is set to launch its own blockchain in August, as project creator Shytoshi Kusama confirmed at a conference in Canada. This is a very interesting step for this rather quiet, albeit very popular, crypto asset.

The Shiba Inu blockchain will focus on applications NFT, metaverse and games. It also recorded a strong increase in the BONE and LEASH ecosystem tokens. The project is also launching a decentralized autonomous organization, or DAO, dubbed DoggyDAO, which will be run by token holders and help fund projects on the Shibarium blockchain.

Competition in the blockchain platform space is tough right now. Ethereum is obviously a giant in this arena, but others such as Tron, Arbitrum, and Polygon have created a diverse and innovative set of ecosystems for users. Adding more is not a bad thing as it will always push the market to be more competitive and innovative while giving investors more choice.