A Rough Weekend Left Bitcoin and Ethereum With More Problems Than Before
Monday did not offer any relief. Both Bitcoin and Ethereum came into the week softer, and the list of things working against them had ...
Quick overview
- Bitcoin and Ethereum started the week on a downward trend, facing increasing challenges.
- Trump's comments over the weekend undermined diplomatic optimism regarding Iran, impacting inflation and the Fed's stance.
- The DRIFT Protocol suffered a significant loss of $285 million due to a targeted operation, leading to a sharp drop in its token value.
- The current market sentiment remains fearful, with low liquidity and cautious investors reluctant to engage.
Monday did not offer any relief. Both Bitcoin and Ethereum came into the week softer, and the list of things working against them had actually gotten longer over the prior 48 hours rather than shorter. None of it is simple to shake off.
Trump killed the ceasefire narrative over the weekend. Whatever diplomatic optimism had been floating around the Iran situation, his comments buried it. He was not interested in a deal, and the Strait of Hormuz was apparently no longer America’s concern to secure. Oil held its gains. That meant inflation pressure stayed in place, the Fed had no reason to shift its stance, and the macro argument for risk assets did not improve.
Saturday brought news of a different kind. DRIFT Protocol lost around $285 million in what looked like a targeted operation rather than a technical failure. The money was gone in minutes. Attribution is still being worked out, but the Lazarus Group has come up in early assessments. DRIFT’s token dropped 40% when the story broke. The funds then started moving out of Solana and across to Ethereum in pieces, spread across more than 100 separate transactions. ZachXBT, who tracks this kind of activity closely, went public with criticism of Circle for not moving quickly enough to freeze the USDC involved while it was still traceable. That raised its own set of questions about how fast the response infrastructure actually works when something goes wrong at speed.
Put those two stories together and add a Fear and Greed reading that has been stuck in extreme fear for weeks. Thin liquidity, cautious participants, and no shortage of reasons to stay on the sidelines. That is not a setup where buyers show up in size.
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