The crypto market is starting the new week with its head down after the crash. The biggest landslide seems to have been digested, but aftershocks have slowed down the recovery so far.
Bitcoin and Bitcoin Prime
Bitcoin Prime and co. were not spared the turbulence over the Whitsun weekend either. The total market capitalisation has fallen by 300 billion US dollars since Friday and is only just above 1.5 trillion US dollars. During the same period, the Bitcoin price was able to catch up to 40,000 US dollars. However, profit-taking pushed the price back down to 34,000 US dollars on Saturday. The cryptocurrency thus fell back 21 per cent in a weekly comparison, but started its next attempt to catch up and gained 2.2 per cent in a daily comparison. At the time of going to press, the BTC price is quoted at 36,538 US dollars.
The aftershock of panic selling has so far shattered the initial attempts at bottoming in the crypto market. Even for the second largest cryptocurrency. Since Ethereum narrowly missed a connection to the 3,000 level on Thursday, the No. 2 has been sliding lower and lower. However, the Ether price has recovered somewhat from yesterday’s weekly low at 1,850 US dollars. At the moment, Ethereum is trading at 2,291 US dollars – a weekly minus of 36 percent.
For the rest of the ten largest cryptocurrencies
For the rest of the ten largest cryptocurrencies, the situation does not look much rosier in the weekly view. Cardano (ADA) is down 35 per cent to US$1.49. Binance Coin (BNB) slips back nearly 47 points, while Dogecoin (DOGE) and XRP each drop 34 and 41 percentage points in the last seven days.
Polkadot (DOT) and Internet Computer (ICP), newly included in the ranking of the ten largest crypto assets, have been hit with 53 and 30 percent price drops, respectively. The ongoing carnage is reflected in Coin360’s overall market visualisation, which has been bathed in red for days.
At least in the weekly view. A little more hope arises when looking at the daily performance. At the moment, re-buying is pushing the crypto market back into positive territory. However, it is questionable whether this will initiate a trend reversal. Similar patterns can be seen again and again after such a crash. As soon as the return is large enough to compensate for the losses incurred in the flash crash, sell-offs are likely to push the overall market down again. This highly volatile move could keep the market on the road to recovery for a few more days.
Bitcoin dominance catches up
Bitcoin’s share of the total market capitalisation has been steadily spiralling downwards in recent weeks. Just a week ago, on 18 May, Bitcoin dominance stood at just under 40 per cent, its lowest level in three years. The slide in BTC dominance has mainly signalled the rally on altcoins, which have been impetuously rushing from one record high to the next. The low value already indicated that some small bubbles have formed in the market. A high Bitcoin-centricity and thus dependence on the cryptocurrency does indeed also create a pitfall. But the distribution of market shares in favour of a few hype coins was the hallmark of an unhealthy and, in retrospect, dearly bought rally.