logo
  

Cryptos Falter But Market Cap Holds Above $1 Trillion

crypto nov17 25jan23 lt

Cryptocurrencies declined more than 2 percent in the past 24 hours amidst anxiety ahead of the release of GDP estimates on Thursday and the PCE inflation readings on Friday. Both the readings would form the input for the Fed's next interest rate review due in the first week of February. Though markets are apparently pricing in a 25-basis points rate hike, recent comments from Fed officials have unnerved markets.

Sentiment also remains influenced by the likely impact that the Fed's Quantitative Tightening could have on liquidity as well as the demand for risk assets like cryptocurrencies. Though the recent easing in liquidity is attributed to the Treasury drawing on the cash balances to avoid debt ceiling issues, there are concerns that once the debt ceiling issues are resolved, there could be a withdrawal in liquidity, exposing the market, especially risk assets to the vagaries of a painful monetary tightening.

The Dollar's relative strengthening against major currencies, reflected in the Dollar Index (DXY) firming up above the 102 level also kept crypto market sentiment in check.

Overall crypto market capitalization is currently at $1.03 trillion, versus $1.05 trillion a day earlier.

Bitcoin (BTC) traded between $23,048.18 and $22,406.08 in the past 24 hours. BTC is currently trading at $22,604.59, down 1.4 percent on an overnight basis. The lead cryptocurrency is holding on to gains of 5 percent in the past week and 36 percent on a year-to-date basis. In addition to monetary policy anxiety, sentiment was also swayed by speculation that Bitcoin miners suffering from debt as well as high energy prices would offload their holdings given the recent gains.

Ethereum's overnight decline was much higher at 4 percent. Ether is currently trading at $1,554.38, after ranging between $1,623.75 and $1,530.80 in the past 24 hours.
Ethereum developers had on Monday deployed the shadow fork ahead of the Shanghai hard fork due in March 2023. The shadow fork is expected to serve as a testing environment for the Shanghai upgrade that would allow developers to identify any potential issues or bugs. The Shanghai Upgrade assumes significance as it would allow ether "stakers" to withdraw the staked ETH. However, market response to the shadow fork has been tepid and Ethereum has shed more than 2 percent over the past week.

BNB (BNB) declined 4.2 percent in the past 24 hours and 0.74 percent in the past week to trade at $300.80. Sentiment remained weak amidst reports that the company mixed up customer funds with B-Token collateral. Bloomberg has in a tweet reported that Binance acknowledges that it mistakenly keeps collateral for some of the tokens it issues in the same wallet as exchange customer funds.

XRP (XRP) declined 3.7 percent overnight amidst lingering anxiety over whether Ripple Labs would be able to win the lawsuit against the U.S.SEC. XRP is however holding on to gains of more than 3 percent in the past week.

8th ranked Cardano (ADA) declined 4.4 percent overnight. Meanwhile, CoinDesk has reported that the Cardano-based overcollateralized stablecoin Djed would be launched next week. The stablecoin which can be minted by ADA holders is expected to be integrated to several Cardano dApps upon launch.

9th ranked Dogecoin declined 4.7 percent overnight and 3.3 percent in the past week amidst anxiety ahead of the release of quarterly results by Tesla, Inc. DOGE is the biggest laggard among the top10 cryptos.

10th ranked Solana is down 1.9 percent overnight but is holding on to gains of 2.9 percent in the past week and 139 percent on a year-to-date basis.

For More Cryptocurrency News, visit rttnews.com

For comments and feedback contact: editorial@rttnews.com

Follow RTT