

Higher than expected CPI causes sharp sell-offs as inflationary pressure continues to spook the market.
Fed Failed to Contain Inflation
The US’s annual inflation rate rose to 8.6%, the highest rate since December 1981, causing a market-wide sell-off as high energy costs continue to accelerate the rate of inflation. The Federal Reserve (Fed), despite taking numerous measures, was unable to contain inflation.

The S&P 500 and Nasdaq dropped 2.9% and 3.5% respectively after the Bureau of Labor Statistics released the Consumer Price Index (CPI) on Friday. Bitcoin ($BTC) and the wider crypto market took a hit. Bitcoin is currently trading at $27,532.

Ethereum ($ ETH ) has also suffered a heavy blow after falling to a 15-month low below the crucial $1,600 mark. This came just days after Ethereum completed a test merge on the Ropsten network.

Selling momentum remains strong as the broader market retreats from risk assets until the US’s monetary policy stabilizes.
Weekly Recap
- CrowFi’s lead developer stole funds in $CROW tokens.
- BNB Chain teased a roadmap for 2022.
- Binance African Blockchain Tour kickstarts in Nigeria.
- Cronos announces the launch of Cronos Accelerator Program.
- Binance.Us announces staking for customers.
- Crypto.com and the Economist released Annual Crypto Report.
- PancakeSwap receives strategic investment from Binance Labs.
- CUBE joins the BAS ecosystem.
- Baby Doge Coin and CryptoBlades celebrate 1-year anniversary.
- Binance makes Web3 headway into the Philippines.
- Baby Doge opens its doors to community proposals.
- BiSwap NFT Marketplace V2 goes live.
- Ethereum successfully tested the Marge on Ropsten’s testnet.
- Gitcoin starts its grant campaign with massive backing.
- CronosVerse IDO coming to Crodex.
Market Sentiment

Many investors are swapping their investments for risk-off assets. Bitcoin and other crypto-assets are deemed volatile assets. The bearish sentiment in the crypto market will likely continue unless the following takes place:
- The end of the Ukraine-Russia crisis
- The US’s monetary policy stabilizes
- A comprehensive crypto regulatory framework is introduced
Unless Bitcoin’s price pushes past the 200-day moving average, there is no reversal in sight. This bearish phase will likely continue for the next few months until the Fed manages to reign in inflation. Inflation is a real threat to the US economy and the sanction on Russia is causing a deepening energy crisis.

Coins to Watch
- Optimism ($OP) - Optimism is one of the anticipated layer-2 solutions after Arbitrum.
- $OP’s price tanked after its airdrop and the recent exploitation.
- Optimism will tap into the liquidity of Ethereum’s ecosystem.

- Ethereum ($ETH) - Ethereum’s recent sharp dip could be a result of investors taking a backseat as Ethereum heads into the Merge.
- This is the perfect opportunity to implement a dollar-cost averaging (DCA) strategy.
- Ethereum will continue to dominate the smart contract platform because of its first mover’s advantage.
- Solana ($SOL) continues to dip, bringing this crypto asset into oversold territory.
- $SOL will likely recover in the coming months as the sheer size of its ecosystem will drive the demand for its native coin.
- Solana’s backers have remained steadfast with the layer-1 platform even after the recent outages.
- Solana has one of the best risk/reward ratios for the top-10 crypto asset by market cap.
Navigating the Bear Market
Most market participants that did not cash out will likely see a significant drop in their portfolio size. There is no indication that the market uncertainties will end soon. Therefore, a few steps can be taken to mitigate risks.
- Avoid leverage trading
- Implement a dollar-cost averaging (DCA) strategy
- Choose institution-backed projects with a sizeable market cap
- Avoid low-capped altcoins
- Choose projects with a healthy community engagement and a roadmap
- Identify value builders in the ecosystem
- Avoid putting all eggs in a single basket, diversify your portfolio.
There might be a further downside, but it would be impossible to catch the absolute bottom. Low capped altcoins that can give exponential gains should be a secondary priority. Risk management is the key to building a healthy portfolio.
Come back next week for another iteration of Weekly Digest: Chung's Picks of the Week from BSC News. Be sure to follow Chung Yee on Twitter.
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