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Leading cryptocurrencies such as Bitcoin and Ethereum experienced further drop over the weekend, wiping off the small gains made in the previous week. The data from CoinMarketCap reveals that the global crypto market cap fell to $1.03 trillion, a 7.5% drop in just 24 hours.
The top crypto asset Bitcoin reached its lowest point of 2022 and a 12-month, $25,513, 18% down in the past seven days. Meanwhile, Ethereum too fell by 28% in the last week even though on Wednesday, the ecosystem completed a successful merge test drive on the Ropsten Testnet. However, Ethereum core developers informed on Friday that a crucial step in The Merge, “difficulty bomb,” is further delayed for another two months. This announcement might have further repelled potential investors.
The price downturn was not limited to only BTC and ETH; almost all the top 20 coins by market cap experienced steep dips in their prices in the past seven days. Solana(SOL) suffered 31% drop, Dogecoin(DOGE) and Polkadot(DOT) fell by 28%, Cardano (ADA) declined by 24%, Polygon (MATIC) 25%, Avalanche (AVAX) 35% and Cardano (ADA) down 24%.
The crypto market did not continue the bullish trend in 2020 and 2021 since the beginning, however, the crypto crash in the first week of May proved to be most destructive as leading coins went down hand in hand with stock markets. Then the dramatic collapse of the Terra ecosystem. This week, a Chainalysis report noted tech stock sell-off as the major cause behind Bitcoin’s decline, instead of Terra collapse.Since then both tech stocks and crypto keep falling.
In 2021, for the third year, Bitcoin outperformed both gold and the stock market. The leading crypto asset was considered as a hedge against inflation, however it didn’t act like that this year, hitting its highest level of correlation with Nasdaq and S&P 500 since 2020, this January.
Currently, both tech stocks and crypto are free falling together.
Another bearish trend in crypto and equities can be seen sprouting as geopolitical uncertainty, negative sentiment around crypto and COVID-19 hangover came into the picture.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
