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Terra Is Attracting Large Share Of DeFi Market

LUNA’s 50% increase in the last week has made it one of crypto’s most popular coins. With $34 billion worth, Terra (LUNA) currently occupies a seventh place on Coinmarketcap, and even more, headlines are making themselves known with this rise to fame. Not only did the token shoot up past Solana ($32B), but also Cardano ($31B), who sit eighth & ninth respectively now that their rankings have changed due to LUNA’s hipe.

LUNA is the token that fuels the DeFi ecosystem. However, the real product is stablecoins, like UST, which pegs its value to dollars. Also protects against volatility in cryptocurrency prices by keeping your wealth protected from fluctuations.

Related Reading | Terra (LUNA) Outperforms Popular Cryptos Ether, Dogecoin In The Past 24 Hours

The UST and LUNA markets are in a tug of war. The two stablecoins compete with one another for investors’ attention, but they also affect each other’s prices as well. When the USD-based Terra gains more traction than its crypto counterpart, there will likely be an increase on both sides due to their unique algorithmic mechanisms, which motivate market agents (arbitrage opportunities)

There are many stablecoins, but UST is the only one with decentralization. The market cap of $13 billion makes it the fourth-largest stablecoin. All other top hitters are centralized. Tether with a $79 billion market cap, followed by Circles’ USDC$53 billion and BUSD ($18 billion)

The latest data from DefiLlama shows that 11.2% of all funds locked up in DeFi space belong to Terra nodes alone. A rather impressive number considering its $23 billion worth compared well with other platforms like Solana or Fantom, which have less than half as much funding. Ethereum still rules supreme, though; they claim 55 percent dominance when they include their total invested.

Terra (LUNA) Price Update

LUNA has been one of the more exciting coins to watch over recent months. However, since January, its price action became divorced from what most investors would expect in a highly correlated market like cryptocurrency trading.

LUNA currently trading 0.6% down at $91.6 | Source: LUNA/USD Chart on Tradingview.com

LUNA is trading at $92.55, with 24-hour highs near $96.31 and lows of $89.21. With a $34.5 billion market cap, the coin holds 7th rank in the crypto market. However, if entirely diluted, the market value may reach $72 billion, which would be an incredible investment return for anyone who is currently investing. 

Related Reading | Market Update: Crypto Market Rebounds As Tech firms Boycott Russia

LUNA is one of the most resilient coins in this crypto bear market, and according to Matt Hougan from Bitwise Asset Management, it’s on an “absolutely spectacular run” so far. It fell less than others during recent volatility while recovering faster too.

The price of LUNA is skyrocketing. According to some analysts, it could hit $98 by the end of this month.

Featured image from Flickr Chart from Tradingview.com

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Crypto Market Cap Rebounds, Reaches $2 Trillion

The crypto market has experienced a sudden surge in value, with Bitcoin’s price climbing near $45K to bring market capitalization back over two trillion dollars.

It’s been a fantastic week for cryptocurrency. Over the past week, Bitcoin’s price has risen 14%, while Ethereum (ETH) gained 12%. 

The cryptocurrency market continues its recent notice by raking in more than $2 trillion. One of the most popular and successful coins has been Terra’s LUNA, which climbed nearly 70% over the last week.

Related Reading | Bitcoin’s Price Up $10K As Crypto Is Predicted To Breach $100K In 5 Years

Solana’s SOL has appreciated in value this week, gaining 18.5%. Other tokens such as Avalanche’s AVAX and Polkadot’s DOT are also seeing increased appreciation, with Avax rising 16% while the latter growing nearly 13%.

Bitcoin is now the most valuable currency in terms of market capitalization, surpassing Russia’s rapidly deteriorating ruble. The price for one bitcoin has increased to $45,000 and reached the market capital at around 835 billion U.S., while its Moscow-based competitor only commands 625B USD today.

Bitcoin is 1.5% down today | Source: BTC/USD chart on Tradingview.com
Analyst Reviews On Crypto Market

According to Marcus Sotiriou, an analyst at UK-based digital asset broker GlobalBlock, with Bitcoin’s big move, it seems that the cryptocurrency has decoupled from stock markets.

The markets have been on an incredible tear this week! And it looks like they could be heading for a potential decoupling from stocks. This would mean that in the short term, at least–with long-term implications still up in the air.

The current crypto market outlook is eerily reminiscent of March 2020. However, it feels like we’re in for another significant uptick, with Real Vision CEO Raoul Pal predicting “a lot more collaboration” from within the industry soon enough.

Raoul Pal tweeted when Bitcoin broke above $44,000;

Back then, we threw the worse possible news at it (a pandemic and a global shut down), and it fell very sharply but failed to make a new low.

Related Reading | Bitcoin Taker Buy/Sell Volume Shows “Buy” Signal As BTC Gears Up For Rally

The Ukraine war, higher rates, and surging oil have created a perfect storm for cryptocurrencies. While the future may be bright with new opportunities emerging from this time of chaos in investors’ eyes – Pal thinks Bitcoin failed to make another low suggests “macro might get more positive.”

However, he also urged caution, noting that the end of this tech sell-off could ignite a fresh collapse in crypto.

Power Of Borderless Currencies

This week, the power of borderless assets like Bitcoin and Ethereum was on display. When people fleeing Ukraine turned to digital currency for financial support. As a reminder, DeFi solutions such as non-custodial wallets can be crucial in times like these. They allow those without formal funds access regardless of where they are located or what government may rule them out from receiving traditional help altogether.

With Ukraine’s move to ask for crypto donations, the process of adopting this new and exciting asset class is set into motion. So naturally, you could say that its price has been growing steadily ever since.

Featured image from Pixabay, Chart from TradingView.com

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Uniswap Registers Yearly Low: Vital Trading Levels To Follow

The broader crypto market jolted hard owing to the tension between Russia and Ukraine. Uniswap broke below its crucial support level and was priced at $8.32. Bitcoin slid off its charts at press time, after noting a 9% depreciation. The crypto market had barely recovered from the December crash.

With the Russia and Ukraine tension intensifying most altcoins have again lost much of their strength. Uniswap for instance at the current price level flashed a yearly low too.

Uniswap had registered an all-time high of $45 in the month of May, last year post which the coin continued to dip on its charts. The coin breached its long holding support level of $12.65 and broke below a series of resistance lines.

Related Article | Bloomberg Strategist: This Is The Defining Moment To Buy Bitcoin

Uniswap Price Analysis: Four-Hour Chart
Image Source: UNI/USD TradingView

Uniswap was priced at $8.32 and was closing near its immediate support level of $7.87. In the last 24 hours, UNI lost 7% of its value and over the last week, the coin had shed almost 24% of its value. The coin had tried to consolidate near its $12.65 support line, post which UNI continued to move in a downtrend.

After the coin breached the aforementioned support line, UNI had tried to hold itself above the price floor of $8.36, however, the coin broke below the $8.36 price mark. Uniswap had also tried to bounce back from the $8.36 and touch the $9.26 price mark.

If the coin continues to trade beneath the $10.01 price floor, which UNI had retested a couple of times then there could be chances that UNI would dip below the support level of $7.87.

The coin has remained under brought for almost one week now, forcing the coin to touch a yearly low. The last time UNI traded at this price mark it was in the month of January 2021. A fall from the $7.87 would push UNI to trade between the $6 and $5.88 price levels.

Rationale

The technical outlook of Uniswap was quite bearish at the time of writing, over the past week UNI had displayed a consistent bearish outlook. Ever since UNI started dipping down from the $10.01 support line, buyers started to exit the market.

Related Reading | Russia Can Avoid Sanctions By Using A Wide Range Of Cryptocurrency Tools

The aforementioned situation had pushed the UNI to the oversold area. The Relative Strength Index was parked underneath the half-line, which indicated that buying strength was absent in the market and selling pressure dominated the coin. Although RSI had noted a slight uptick, at press time the indicator again started to side with the bears.

UNI was trading beneath the 20-SMA line, which is indicative of a bearish outlook. The sellers in the market were responsible for driving the price momentum of the market.

MACD underwent a bearish crossover and the coin started to depict red histograms at the time of writing. This reading meant that the market trend continued to act in accordance with the bears in the market.

 

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Bitcoin Dominance Will Continue To Decline In Favor Of Ethereum, Altcoins, FTX US President

Bitcoin has maintained dominance over altcoins like Ethereum and others for the longest time. This dominance, although has declined over time, still helps the digital asset maintain its title as the most valuable cryptocurrency in the space. However, in only a matter of years, bitcoin’s dominance on the market has declined by half, and according to FTX US President Brett Harrison, the encroachment is far from over.

Bitcoin To Lose More Market Share To Altcoins

In a recent interview on CNBC’s Squawk Box, FTX.US president Brett Harrison shares his thoughts around the market, most notably the market dominance of bitcoin in relation to altcoin. The dominance of the pioneer cryptocurrency has been a slow but steady downtrend that has seen bitcoin’s dominance ridden down to as low as 40% and Harrison expects this to continue.

Related Reading | Bitcoin Hashrate Climbs To New High As Price Recovers Above $42,000

The President told Squawk Box that other digital assets like Ethereum and Solana will continue to take up more market share from the asset. And over time, Harrison explained, the percentage of market share that is controlled by a single asset, in this case, BTC, will continue to wane.

“Assets like Ether, other alternative proof-of-stake assets like Solana, and these other alternative coins are all picking up in terms of market cap,” said Harrison. “Over time, we are going to see less and less of the total market share come from just one asset, Bitcoin alone.”

With this current trend, the market is expected to see more decline in BTC’s dominance over the market. This does not mean that the digital asset becomes less important, but as investors turn to altcoins for better opportunities, BTC will find itself commanding less and less of the market share.

BTC’s Dominance Over Time

Like anything in the crypto space, bitcoin’s dominance in the market has fluctuated widely. However, one thing remains constant and that is the fact that altcoins continue to eat into this market share.

Related Reading | These Two Altcoins Are Ready For Major Pullback, Says Crypto Analyst

Only five years ago, before the likes of Ethereum and Cardano grew into their own, Bitcoin maintained the vast majority of the market share. In February 2017, the market share commanded by the digital asset was 96%. Five years later, it has lost half of this dominance to be sitting at 43.08% as of the time of this writing.

BTC dominance declines to 43% | Source: Market Cap BTC Dominance on TradingView.com

Over the years, the decline has been very obvious. By 2018, only one year after, bitcoin managed to lose more than 50% of its dominance, seeing it touch its lowest point of 35%. It has since recovered more market share since this time, but trends point towards further downside as blockchains like Ethereum and Solana steal more market share with DeFi and NFT capabilities.

Featured image from Banking Exchange, chart from TradingView.com

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Gold-Backed Tokens Outperform Crypto Market. Further Upside Coming?

The crypto market has been on a recovery trend lately. Even with the market crash, it had already marked a year of massive returns for investors in the space. As is expected with a space with high volatility, crypto assets had begun to crumble in value. But despite the profitable year for cryptocurrencies, a subset of crypto tokens had made their mark as the assets with the highest returns, and they don’t look to be stopping anytime soon.

Gold-Backed Tokens Surge

These gold-backed assets have helped to increase the liquidity of gold by enabling the ownership of small fractions of gold. Physical gold is somewhat limited in its supply and tokens like this have provided an avenue for investors to get in on the millennium-old asset. These tokens follow the price of a commodity, gold in this case, in the same way, that stable coins follow the price of the fiat currency they are pegged to.

Related Reading | Crypto Market To Drop 80% Like Early Internet Company Stocks?, Why This Analyst Thinks So

Unlike gold ETFs, gold-backed crypto tokens allow investors to own a part of a physical gold bar, whereas investors are mainly betting on the price of gold with ETFs. Furthermore, investors are able to redeem their gold-backed tokens for physical gold whenever they want.

These characteristics have drawn more and more investors to these commodity-backed crypto tokens and as a result, the price of these digital assets has grown tremendously. So much so that these assets have been able to outperform the crypto market at large.

Gold-backed tokens outperform crypto market | Source: Arcane Research

Two of these gold-backed commodities have recorded the highest growth; Tether Gold (XAUT) and PAX Gold (PAXG). These two crypto assets have grown to a market cap of $409 million and $358 million respectively, marking a significant growth year for each asset.

Beating The Crypto Market

Even with the crypto market marking several bull runs in 2021, gold-backed tokens have managed to outperform the market. In 2021, the overall crypto market had grown a total of 150%. In contrast, the gold-backed token market surged as high as 360% in the same time period, returning more than twice that of the broader crypto market, with PAX Gold and Tether Gold leading the charge.

Crypto total market cap at $1.95 trillion | Source: Crypto Total Market Cap on TradingView.com

Other commodities-backed crypto tokens have also begun to gain prominence in the market. Others have emerged that have been tied to silver, palladium, and even oil, but all of these have been met with obstacles that they have found hard to scale, stunting their growth.

Related Reading | Why Is Talent Leaving Silicon Valley For Crypto Companies? Recruiters Explain

Nevertheless, the gold-backed tokens have shown that commodities-backed tokens do have a future in the market. With growth expected to continue across the crypto market, these tokens may be on their way to being one of the most profitable subsets of crypto investments in the space.

Featured image from Finance Magnates, charts from Arcane Research and TradingView.com

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Bloody Altcoin January Shows Why Bitcoin Remains The Crypto Safe Haven

Bitcoin has outperformed all crypto Market Cap-Weighted Indexes in January as traders turn to less risky assets amidst fear over the Federal Reserve tightening, thus the king of digital assets claims its position as crypto’s safe heaven.

Related Reading | Bitcoin Begins To Form A Bottom? Why $40K Is The Next Target

 Bitcoin As a Crypto Safe Haven

The thought of Bitcoin (BTC) being a safe haven asset is quite popular, but it opposes the critics who claim BTC –and all crypto assets–  is too risky, volatile, and speculative to become a safe haven. However, inside the crypto market it remains the less risky asset.

January was a very volatile month for the crypto market amidst the investors fear over The Federal Reserve (FED) hawkish moves, but an Arcane Research report shed light on how Bitcoin outperformed the other crypto indexes in the market during the bloodshed, thus maintaining its image as the less risky crypto asset to investors, especially during times of high volatility and uncertainty.

As traders take a more conservative position and look away from the most speculative assets, the Arcane report highlights how all crypto indexes saw losses between 20% and 31% this past month.

However, like the following charts show, BTC outperformed all altcoins conserving the highest crypto market cap and counting less losses. Meanwhile, the Small Cap Index fell the hardest, showing how the crypto market shifted amidst the traders’ conservatory tendency.

Source: Arcane Research

 

Source: Arcane Research

This gets us back to the “BTC as a crypto safe haven” belief, since the digital coin remains the least risky crypto asset to investors, who lean on it in times of turmoil.

On the other hand, the market sentiment is carefully improving “with the Fear and Greed Index now ‘only’ signaling ‘fear’ after a sustained period of ‘extreme fear’”. This could mean a better landscape for altcoins as traders’ position might turn around to the less “boring” assets.

At the moment of writing, Bitcoin trades at $38,545, up 0.98% in the last 24 hours.

Bitcoin trading at $38,545 in the daily chart | Source: BTCUSD on TradingView.com
What Studies Have Said Over The Years

Beyond the crypto market, some studies had predicted that “Investors in the US may cautiously use bitcoin as a hedge against uncertainties.”

A study from 2019 that assessed whether Bitcoin could be a hedge at the intraday level gave results that indicated that “Bitcoin can be deemed a hedge at various periods of time” as well as a “diversifier for currency investors.”

Furthermore, their results from a non-temporal threshold analysis revealed that “Bitcoin is a safe haven during high and extreme periods of market turmoil for the CAD, CHF and GBP, but fails to act as a safe haven for the other currencies.”

Then in 2020, other experts concluded the following:

Based on the WHO COVID-19 pandemic proclamation on March 11, 2020, we test the Bitcoin and Ethereum as safe-havens for stocks. Our dynamic correlations and regressions results show that Bitcoin and Ethereum, as the two major cryptocurrencies, display short-term safe-haven characteristics for stocks.

However, other research carried out in the same year had opposing conclusions, coming to deny the digital coin as a safe haven:

“During the period under consideration, we find that the S&P 500 and Bitcoin move in lockstep, resulting in increased downside risk for an investor with an allocation to Bitcoin.”

As the international political and economic panorama evolves with high uncertainties this year, new data to come will most likely be relevant when making a case about how the crypto market reacts and which digital coins can become the most useful tools.

Related Reading | TA: Bitcoin Near Crucial Juncture: Why BTC Could Surge Further

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Solana Suffers Outage And Tanks 16%. What’s Next?

The past few days may have weakened the image of Solana (SOL). High levels of network congestion brought a new outage to the network and SOL fell the hardest amongst the top 20 cryptocurrencies amidst the market crash.

Here’s What Happened

Last week, it was reported that Solana’s network was clogged, resulting in many failing transactions and DeFi users not being able to adjust their collateral positions to reflect the new valuation of the coin amidst the crypto market fall.

In a Solana blog post, the team explained that the incident experienced by validators was due to excessive duplicate transactions sent by bots and “related to issues previously identified that engineers have been working to improve and resolve”.

This is not the first outage for the Solana network. The 18-hour network outage in September 2021 caused by heavy transaction traffic remains the harshest one. And just this month, this has been the second, following an outage on January 4.

Related Reading | Algorand, Solana, And More Lead List Of Biggest Losing Altcoins

Liquidated Solana Users

The DeFi lending protocol built on Solana, Solend, stated that the market crash “caused many accounts to become liquidatable and created many profitable arbitrage opportunities.”

SOL price dramatically plummeted as the whole crypto market tumbled, thus users with collateral needed to increase their position in order to not have their assets liquidated. Position liquidators receive a bounty from liquidated positions, so when scenarios like this happen they “race to close eligible positions”, as Laine the blockchain business that operates validators on Solana explained.

This is the reason behind bots, created to help liquidators win the race, but for this, “they submit the same transaction dozens or hundreds of times”. This turns into a mass of duplicated transactions that need to be verified by validators.

There was a massive quantity of attempts by Solend users trying to deposit and repay to avoid liquidations, but all they met was network congestion.

“This large load caused validators to falter, especially since they were not filtering out duplicate transactions optimally, wasting precious compute. The thousands of duplicate bot transactions also drowned out legitimate user transactions.”

Solend further stated, “In addition, there was some erroneous volatility on the Pyth price feed, which caused wrongful liquidations (e.g. some users supplying mSOL and borrowing SOL were liquidated due to prices moving out of sync).”

Solend later announced that they are working to reconcile problems encountered by users. The platform will “Reimburse 100% of the penalty for users liquidated due to abnormal volatility on the SOL feed” and “Reimburse 50% of the penalty for other liquidations.”

SOL Price Tanked

SOL is now down 42% in the last week and decreased dramatically from $144 on early Thursday to around $80 on Monday. It has now recovered slightly to $92,42 at the time of writing.

Consequently, SOL lost its position as the 7th-largest coin to XRP, and overall saw the deepest pool of blood among the top 20 cryptocurrencies, with many users left wondering if their network is worth the risk.

Solana trading down to $92,28 in the daily chart | Source: SOLUSD on TradingView.com

Related Reading | Solana Could Flip Ethereum To Become “Visa Of Crypto,” New Study By Bank Of America Shows

What’s Next For SOL?

Solana released the v1.8.14 update to “mitigate the worst effects of this issue” and alleged that “engineers have been working to improve and resolve” the issues related to network congestion starting with the 1.8 release. More updates to implement v1.9 are expected over the following 8 to 12 weeks.

“These forthcoming releases are aimed at improving the state of the network, with more improvements expected to roll out in the next 8-12 weeks. Many of these features are currently live on Testnet, where they are being rigorously tested.”

Many users didn’t find relief in the answers from the Solana-supporter CEOs and its co-founder Anatoly Yakovenko and called them out for allegedly doing false claims and dishonest wordplay. The network might be in a key point for its future growth. The new updates need to scale with the demand and provide trust to the disappointed users.

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Market Sentiment Crumbles As Sell-Offs Drags Bitcoin To $33,000

The current market crash is no doubt one of the hardest to hit in recent times. Bitcoin as well as other digital assets have suffered massive dips as a result of the crash. For Bitcoin, the pioneer cryptocurrency has had more than 50% of its all-time high shaved off in the last two months. This has caused it to hit new six-month lows as its price crashes to $33,000 for the first time since the summer.

Market sentiment has since nosedived in accordance with the movement of the market. As investors become increasingly wary of the market, more so than it was during the crash in May, sentiment has skewed entirely into the negative. The Fear & Greed Index puts this into perspective with its current rating as it now sits at one-year lows, crashing to 11 on the scale.

Related Reading | Ethereum Fee Averages Remain Above $30 Despite 35% Drop. Price Pump Incoming?

Fear & Greed Index Goes Haywire

The Fear & Greed Index has been consistently declining into the negative as bitcoin and others have continued to record massive fluctuations. Now, though, the index has gone completely berserk as it crashes into one of the lowest recorded points. On Sunday, the Fear & Greed Index hit a score of 11, completely registering sentiment in the negative as it dived into extreme fear.

The following day has not come with much good news as the Fear & Greed Index still shows that investors are very wary of the market. The index currently sits at 13 at the time of this writing, a mere 2 points higher than its weekend low of 11. Nevertheless, the Fear & Greed Index has now spent a week in extreme fear as last week concluded with the index in the same territory.

Fear & Greed Index remains in extreme fear | Source: alternative.me

Sell-offs remain the order of the day with investors scrambling to save themselves from more losses. It looks to be what is the start of another stretched-out bear market, as the last time something like this occurred was in 2018. After this, the market did not recover for another two years. If history is anything to go by, then the downtrend may not be over, with some predicting the bottom to be as low as $10,000.

Bitcoin Liquidations Rack Up

Amidst the sell-offs and price crash has been massive liquidations. Bitcoin long traders have naturally borne the brunt of the recorded liquidations with hundreds of millions of dollars in longs liquidated in the space of 24 hours. BTC liquidations racked up to $390 million in a single day, while the 12-day chart looks even worse with more liquidations taking place.

Related Reading | Bitcoin Breaks $37,000, Why Downtrend To $29,000 Is Likely

In total, there have been over $283 million in bitcoin liquidated in the last 12 hours. Longs have made up 80.8% of all liquidations according to data from Coinglass. OKEx, Binance, and FTX maintain the lead for exchanges with most liquidations as the majority have occurred on these platforms.

BTC recovers to $34k | Source: BTCUSD on TradingView.com

Bitcoin’s price continues to trend low, touching $33,000 in the early hours of Monday. Twitter is abuzz with talk of the bitcoin crash with #BitcoinCrash trending. The digital asset is now trading at $34,200, with indicators pointing towards further dips.

Featured image from Unfinished Success, charts from alternative.me and TradingView.com

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Market May Be Suffering But Bitcoin And Ethereum Will Pull Back Stronger, Bloomberg Analyst

Bitcoin and Ethereum have led the market in the recent downturns that have rocked the market. These two digital assets are no doubt market movers in their own right and as such, uptrends or downtrends begin with them. It has raised concern among investors who believe that the market is finally heading into a stretched-out bear market. However, not everyone believes this as some believe the current downtrend is only temporary.

Mike McGlone On Bitcoin And Ethereum

Mike McGlone is one of the leading Bloomberg analysts. Focused on the financial market, he authors a newsletter that shares his thoughts around various markets, including stocks and the crypto market. McGlone is currently one of the people with the most optimistic view of the market despite the various dips that have rocked the space. Most especially on the top digital assets in the crypto market.

Related Reading | Solo Ethereum Miner Hits The Jackpot With 170 ETH For Mining A Block

McGlone who was on The Wolf of all Streets podcast shared some interesting thoughts on the market, putting the analyst at an overall bullish position for bitcoin and ethereum.

BTC down to $38K | Source: BTCUSD on TradingView.com

The analysts point to the correlation with the stock market. This, he explains, is getting ready for a pullback and when this happens, bitcoin and by extension, ethereum, would benefit from this correction.

“Here’s my prediction: the markets pull back,” said Mike McGlone. “We finally get a 10%, maybe 20%, correction in the stock market. All correlations are one, which is usually the way it works. Bitcoin comes out better off for it. Ethereum, potentially too.”

This pullback though is only reflected on the top two cryptos which McGlone expects to recover after this.

Other Cryptos May Not Fare Well

Talking about other cryptocurrencies, the analyst took a more bearish stance on them. The positivity displayed in the podcast towards top coins bitcoin and ethereum did not translate to the rest of the market which he does not expect to fare well despite the pullback.

Related Reading | Ethereum Fee Averages Remain Above $30 Despite 35% Drop. Price Pump Incoming?

McGlone especially focused on dog coins which were arguably the winners of 2021. The craze which saw various meme tokens with no utility whatsoever soar to billions of dollars in valuation was referred to as “stupid” by the Bloomberg analyst.

“The rest of the space, we do have to admit, the speculation you saw in the dog coins last year was indicative of this. It’s just stupid and we’re going to tell the story to our grandkids,” he said.

Even for a digital asset like Solana which had a largely successful year, McGlone did not seem excited about it. He lumped SOL in with the dog coins, which he said were the riskiest of assets. “The bottom line is they are the riskiest of assets,” said McGlone. “There’s massive speculation. I mean the dog coins and even in things like Solana,” he added.

Featured image from Bitcoin news, chart from TradingView.com

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$200 Billion Exits The Market As Bitcoin Plummets To A Multi-Month Low

Bitcoin, the top asset in the industry has noted a sharp fall in prices over the last 24 hours. At press time, the king-coin depreciated by almost over 9.7%. Bitcoin dropped its value by almost $7,000 and was exchanging hands at $38,233.95. This marked an almost six-month low for the coin. This price level is the lowest ever since the first week of August last year. Following Bitcoin’s price action, altcoins followed suit as a majority of them were seen trading in the red at the time of writing.

The global cryptocurrency market cap was at $1.95 trillion after a considerable fall of about 7.7% over the past day. The global crypto cap hadn’t dipped below the $2.11 Trillion mark in over 3 months now. This major plunge in value across the broader cryptocurrency market had caused roughly $200 Billion to leave the market. Ethereum, which is the second-largest cryptocurrency in regards to market capitalisation also registered a tumble of about 8% in the last 24 hours.

Related Reading |TA: Bitcoin Dives Below $40K, Why Bulls Could Struggle In Near Term

What Could Have Potentially Caused This Big Dump

The bears had taken over the market, however, it isn’t safe to assume that the market would continue with a bearish outlook just yet. This could also be a price correction from which Bitcoin and major altcoins might recover over the upcoming trading sessions.

This retracement in Bitcoin’s prices from $43,000 could have happened for a number of reasons. Needless to say, crypto markets are volatile, however, current price movements of the major cryptocurrencies can be tied to a couple of recent developments in the crypto space.

This sudden substantial sell-off in prices could have been caused due to stock market weakness after the US Federal Reserve introduced high-interest rates and tapered the stimulus. The Fed hiking the interest rates in the form of tightening the overall monetary policy has, in turn, affected the unregulated market of cryptocurrencies.

The cryptocurrency industry has also suffered the pangs of other recent regulatory measures. The most recent one is Russia’s blanket ban which has rocked the global cryptocurrency market. Other regulatory measures which have been set in motion to curb the rapid growth of digital asset has also had negative effects on the prices.

Securities and Exchange Commission has signaled at scrutinising cryptocurrency exchanges. Environmental factors have also raised eyebrows of regulatory bodies, European Securities and Markets Authority (ESMA) wishes for the EU to ban the proof-of-work model.

All of the above-cited reasons have sent shock waves across the crypto industry causing the fear index to point at 19, a number that corresponds to “Extreme Fear” in the market.

Related Reading | TA: Ethereum Nosedives, Indicators Show Signs of Larger Downtrend

Bitcoin Price Analysis: Crucial Trading Levels to Watch Out For

Bitcoin was priced at $38,233.95 after the coin nosedived close to 9% at press time. The asset flashed a death cross, which is considered to be extremely bearish in nature. The prices were beneath the 20-SMA line, indicating that sellers were responsible for driving the price momentum in the market.

Source: BTCUSD on TradingView.com

The Relative Strength Index hurtled as it reflected the excessive selling pressure in the market. Currently, Bitcoin’s RSI was hovering beneath the 25-mark which meant that the asset was oversold and undervalued.

The support level for the coin stood at $37,982.40 and a push from the bears could make BTC trade at that aforementioned level. The Average Directional Index was near the 50-mark, implying a strengthening of the current price trend in the market. The resistance price level for the coin was $39,829.16.

Featured image from The Motley Fool, chart from TradingView.com

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How Bitcoin Is Controlling The Ebb And Flow Of Crypto

Latest data shows that so far in the year 2022, the rest of the crypto market has been moving in tandem with Bitcoin.

Crypto Indexes Follow Bitcoin In January So Far

As per the latest weekly report from Arcane Research, all the various indexes in the crypto market have mimicked BTC’s movements so far in the month of January.

The “crypto indexes” here refer to groups of cryptocurrencies separated into these divisions on the basis of market cap.

There are three main indexes, the “large cap index,” the “mid cap index,” and the “small cap index.” The below chart shows how these various groups have performed compared to Bitcoin in the year 2022 so far:

Looks like monthly performance of the mid cap index has been the best so far | Source: The Arcane Research Weekly Update – Week 2

As you can see in the above graph, the various crypto indexes seem to be moving in tandem with Bitcoin in the year so far.

Related Reading | 70% Of Bitcoin Supply Is In Profit – Why Bulls Need To Defend This Level

BTC’s returns in January stand at double digits in the red at the moment, closely followed by the small cap index which also has 10% in losses.

The large cap has also traced Bitcoin quite closely as its losses stand at 8% right now. The reason for its slight overperformance against BTC has been due to the strength of DOGE, NEAR, and ADA.

While the mid cap index has also mimicked the moves made by BTC, its strength has been much more as its returns for the month are at just 2% in the red.

Related Reading | Bitcoin Supply Shock: Only 12% Of BTC Supply Is On Exchanges Now

The mid cap index has outperformed the rest of the market thanks to the strength of UNI and MATIC, two cryptos that account for about 20% of the total index.

Bitcoin’s dominance has once again dropped in the last week as its share of the total crypto market cap now floats below 40%.

The below table shows the percentage of the total market cap that the top coins occupy right now.

BTC’s share of the market cap has taken a hit of 0.76% over the past week | Source: The Arcane Research Weekly Update – Week 2

Ethereum’s dominance has also dropped in the past week, while smaller altcoins have enjoyed a larger percentage of the market cap.

BTC Price

At the time of writing, Bitcoin’s price floats around $41.9k, down 2% in the last seven days. Over the past month, the crypto has dropped 10% in value.

The below chart shows the trend in the price of BTC over the last five days.

BTC’s price has mostly moved sideways in the last few days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research

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January Proves Turbulent For Investors But NFT And GameFi Seems To Be Eating Good

NFTs existed prior to 2021, but it was last year that digital art exploded in the blockchain space, and digital artists shone in the NFT spotlight. While the crypto world became an exciting place to be, a new generation of NFT artists entered the world’s largest artistic movement to date.

Crypto investors are having a difficult time in January 2022, as the price of Bitcoin (BTC) and other cryptocurrencies continues to fluctuate wildly. Some have blamed the drop on the Federal Reserve’s recent announcement of additional rate hikes, as well as political unrest in Kazakhstan, which drastically reduced Bitcoin’s hash rate. The price of Bitcoin fell below $42,000 on January 14 as traders hoped for bullish signals.

It appears that while the crypto market continues to struggle, the NFT space  is witnessing incredible surge in trading volumes and interest.

NFT & GameFi In Sweet Month

A new report has shown that NFT and GameFi transactions continued to rise despite falling crypto prices. The report by Dappradar noted that “the number of UAW connected to Ethereum NFT DApps has grown by 43% since Q3 2021,” according to the research. The money generated by NFT trading increased from $10.7 billion in Q3 2021 to $11.9 billion in the first ten days of 2022, according to the research. This rise could also be attributed to recent advancements in the NFT arena, such as the establishment of the LooksRare marketplace.

“Blockchain games continue to be widely used,” according to the report, noting that they “represent 52% of the industry’s usage.” The case for blockchain games to continue developing during 2022 has been enhanced by expanding metaverse technologies and the growing success of the play-to-earn model.

Data from Dune Analytics revealed OpenSea, the leading NFT marketplace, generated approximately $2.7 billion in volume in the first half of January, on track to beat the $3.4 billion high it set in August.

OpenSea had its highest single-day volume of $261 million dollars on January 9. So far in January, OpenSea has surpassed $150 million in trade volume on a daily basis.

OpenSea daily volume on Ethereum. Source: Dune Analytics

 

Related article | OpenSea Transaction Volume Shows That NFTs Are Not Slowing

Mason Nystrom, a senior research analyst at Messari, believes the NFT market is in a better position than recent cryptocurrency price moves suggest.

Nystrom noted that:

“The cryptomarkets are fairly correlated – the market tends to rise and fall with Bitcoin. This has made it surprisingly interesting over the recent downturn as the NFT market has continued to increase in volumes. OpenSea has recorded $2.3 billion in NFT volume in January so far, on pace to break its monthly volume record if volumes continue.”

Market Reflects Growing Interest

During this market downturn, Chinese consumers have shown a growing interest in NFTs and blockchain gaming, which aligns with recent Chinese announcements that the government will begin building its own non-crypto NFT. “China is now the country with the most extensive user base…increasing 166 percent from the numbers registered in November,” according to DappRadar’s research.

Crypto Market Cap Stands at $2 trillion. Source: TradingView

Despite the near-term volatility that NFTs may experience as a result of current market conditions, the nature of these digital assets may lead to a decoupling of prices within crypto marketplaces.

Despite the fact that the United States is currently ranked second in terms of overall traffic, the country added 175,000 new members to the NFT ecosystem, representing a 38 percent increase. This is due in part to a rise in interest among younger audiences, as Millennials and Generation Z begin to account for a larger share of traffic.

Related article | a16z, Mark Cuban invest $23 million in NFT platform OpenSea

Featured Image from Unsplash | Charts by Dune Analytics, and TradingView

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Crypto Market Is Still In The Early Stages, Says Ric Edelman

Famed finance author Ric Edelman has said that crypto is still in the very early stages, comparing it to the internet right before the big boom. The crypto market which is a little over a decade old has grown exponentially in its short time in existence. At its highest, the market grew to $3 trillion surpassing the valuation of some of the most valuable companies in the globe. Despite this growth, the market still has a lot of growing to do and Edelman believes this is only the beginning.

Comparing Crypto To The Internet

It is estimated that there are 130 million users of the crypto market currently. This number has grown from the previous years but still remains a tiny fraction of the world’s population who are yet to come into the market. Edelman, speaking with CNBC, explained that the crypt market now is similar to what the internet was 20 or 30 years ago in its growth pattern.

Related Reading | Jack Dorsey Launches Bitcoin Defense Fund To Aid Devs Facing Litigation

This is not the first time that the space would be compared to the growth of the internet. The growth pattern of crypto has closely mirrored that of the internet, albeit at a faster pace, and if history is to be followed, then the next five years could very much see explosive adoption for cryptocurrencies.

Edelman continues on to say that crypto is an innovative technology that is allowing businesses to operate faster, which is what is driving the adoption of the digital assets. Basically, the market is still in its early innings and is yet to see real growth.

“This is really like the internet back 20 or 30 years ago. We have to recognize that this only comes along once in a generation,” Edelman told CNBC. “The innovative technology is allowing businesses to operate faster, cheaper with greater transparency, greater security, and this is why businesses are falling over themselves with development of blockchain technology.”

Cryptomarket recovers above $2 trillion | Source: Crypto Total Market Cap on TradingView.com
Getting Ready For Explosion

With the growth of crypto strongly correlating with that of the internet, Edelman places the current growth of the market at where the internet was in the 1990s. Recall that the internet did not really take off until the late 90s, where it became the ‘thing’ to have. For crypto, it is nearing this point.

“We now have the benefit of experience. We know how the internet just exploded in growth through the 1990s. That’s where we’re at today – incredibly early for the investors who are recognizing the opportunities that aren’t going to exist 10 or 15 years from now the way they exist today.”

Related Reading | Highlighting Risk: These Crypto Coins Carry The Most Leverage

Additionally, Edelman adds that if blockchain technology can be implemented by the Transportation Department which has nothing to do with the movement of money, it shows the broad and significant value of the technology.

The crypto market has now recovered to the $2 trillion mark after a series of crashes and dips that rocked the space. As digital assets begin another recovery trend, this number will continue to rise.

Featured image from Daily Advent, chart from TradingView.com

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ARK Invest CEO Cathie Wood On What Will Drive Bitcoin Correction

The price of bitcoin continues to struggle and investors look towards various indicators to know when the price of the digital asset would begin to correct once again. While some indicators have shown promise in predicting what may yet come, it remains a guessing game as bitcoin has always been known to have a mind of its own when it comes to price movements.

To this end, Cathie Wood, famed CEO of ARK Invest, has shared some interesting thoughts around the market correction and what will drive it. The bitcoin bull continues to look towards the crypto market through a positive lens as she shares what will bring about the market correction.

Related Reading | Bitcoin Discount? Peter Brandt On Why You Shouldn’t Buy The Dip

Crypto Market Succumbs To Strike Against Technology

The whole of the crypto market is built on the back of new technology and as such, will sometimes follow technology trends in the broader market. ARK Invest CEO Cathie Wood posits in a new video on the ARK Invest YouTube channel that this is what is behind the recent crashes.

Basically, there has been a strike against technology, growth, and innovation in the equity markets and the spillover of this strike is what brought down prices across the crypto market. However, the CEO does not expect this strike to last long.

Related Reading | Galaxy Digital CEO Mike Novogratz Says Bitcoin Has Hit The Bottom

Addressing the concerns about technology and innovation stocks being in a bubble, the CEO discounts this theory. Instead, explaining that these stocks are merely in what she refers to as a “deep value territory.”

Wood is known to take risky bets on technology and innovation assets, which have paid off in the long run for her fund, as well as her clients. For the CEO, Bitcoin falls into this territory and has been vocal about her support for the digital asset.

She also predicts a highly profitable future for tech and innovation assets, expecting a 10x growth in the next 10 years.

“Based on the last eight years of our research, the opportunities will scale from $10-12 trillion today, or roughly 10% of the global public equity market cap, to $200+ trillion during the next ten years.”

Where Is Bitcoin Headed?

The new year is now in full swing and the implications of the holiday spending have been showing on the markets. Bitcoin which hit its all-time high of $69K last year has since lost over 30% of its value. The price is not in the $41,000 range, where it continues to struggle as bears try to pull it down.

BTC trading north of $41K | Source: BTCUSD on TradingView.com

For Cathie Wood, it has always been about the long game. Last year, the CEO, at various times, said that she expects the price of bitcoin to grow 10x from its value at the time. She attributes this growth to institutional investors finally moving at least 5% of their portfolios into the digital asset, at which point, bitcoin’s price will grow as high as $500,000 apiece.

Featured image from Page One, chart from TradingView.com

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Solana Trades Up 15.7%, But Network Issues Raise Concerns

Solana (SOL) traded 15.7% up and lead gains earlier as the crypto market started to see the green zone, recovering from the total cap value dropping to $2,1 trillion, now at $2,2 trillion, a 5% increase in 24 hours.

As several altcoins from the top 100 savor the upswing, it’s a polarized day for Solana’s popularity as the network saw major congestion issues that might put down price expectations for 2022.

A few days ago SOL saw a two-month low of around $150, but losses are in reverse in the past 24 hours. The digital coin went up as much as $188, a 15.7% daily growth. Solana’s market cap value grew from  $51.17 billion to $56.76 billion during the period (adding $5.59 billion).

Solana is trading up at $182 in the daily chart | Source: SOLUSD on TradingView.com

In terms of competition for the top 5 cryptocurrencies by market cap, Solana took the win while Ethereum surged around 4%. Cardano climbed 3% and Avalanche, on the other hand, is also seeing growth surging 15% in 24 hours after announcing native support for USD Coin (USDC), swinging up above the $100 mark.

Related Reading | Solana Could Become The Next Bitcoin, According To FTX’s Sam Bankman-Fried

 

Solana, The Cool Kid On The Block?
Taken from Twitter

As Solana grows in popularity surrounded by mainstream projects, crypto users at CoinMarketCap shared positive estimates of the median price for the end of the year: 20,490 people think SOL will be closing the year trading around $185. However, the community is predicting a downside starting 2022 to $171, then lower to $168 by the end of February. What are they seeing?

The cool kid from the block is having trouble at home and the followers are concerned. The network experienced more technical troubles with a large amount of failing transactions: over 2000 per second, more than 60% of the total volume, some have speculated.

Several investors and developers have expressed skepticism and frustration on social media. Some see the glitchy scenario as a sign to step back as it does not provide trust and also fails to meet with the blockchain’s promise of high efficiency.

Related Reading | How Solana Was Brought Down By This dApp Launch

Solana has more troubled moments to mention. The first one was back in September with a 17-hour network outage. Then, during this month alone, on December 9th the network reportedly suffered a distributed denial-of-service (DDoS) attack which also resulted in delayed transactions.

Clarity wasn’t the top priority at the time. The first tweet to mention the DDoS attack was deleted, then the infrastructure firm GenesysGo reported the issue but claimed it was due to “growing pains”. And on December 13th, a Solana-based NFT debut (SolChicks) announced that “CHICKS HAVE TAKEN DOWN SOLANA.”:

We apologize for the inconvenience of this delay but tens of thousands of people are trying to buy $CHICKS and the Raydium server has crashed. It appears SolScan is also not loading our contract address right now either.

However, Solana’s price has not seen investors fear since the last failure of transactions happened –at least not beyond the low prediction from the CoinMarketCap community. Is the hype stronger than the issues?

The rise of Solana has seen big investors as backers (like Sam Bankman-Fried, Andreessen Horowitz, and Polychain) and a large number of projects with big names, especially in the gaming and NFT sectors. If the blockchain’s transactions are not fast enough sometimes, their marketing is.

For example, basketball giant Michael Jordan just announced a platform for athletes called HEIR, which is based on Solana. This mainstream event was believed to carry SOL’s price up. Will popularity be enough for the future of the blockchain?