collapsed 9.5% on Monday and dipped temporarily below $30K in early trading on
Tuesday, stabilising at $31.3K. Ethereum has lost 3.9% in the past 24 hours,
while other leading altcoins in the top 10 have fallen from 8.7% (Solana,
Cardano) to 12% (Avalanche).
market capitalisation, according to CoinMarketCap, fell 7% overnight to $1.44
trillion. Bitcoin's dominance index rose 0.3% to 41.8% on more altcoin
cryptocurrency Fear and Greed Index was down 1 point to 10 by Tuesday and
remains in a state of “extreme fear”, touching a low point for the
seventh time in the past year. An even higher level of fear in the last four
years that we have only seen in March 2020 and September 2019.
TerraUSD continue to lose ground. Against this backdrop, the Luna Foundation
Guard (LFG) has committed $1.5bn to protect the “stability of UST and the
Terra ecosystem as a whole”. Stablecoin UST, designed to be as close to
the value of the USD as possible, lost more than 30% at one point overnight.
But at the time of writing, it is trading at a 14% discount to the US currency.
plunge is a retouch of the lows made in January and July last year for the
first cryptocurrency. This could look like a last line of defence for the bulls,
who may try to push back from the lower end of the trading range since early
many markets are on a similar informal frontier separating a correction from a
potential collapse, so the situation in the crypto market could largely determine
sentiment in the deeper debt and equity markets.
the dynamics of Stablecoin, the crypto market is undergoing one of its most
massive tests of the entire market periphery, which could determine the
credibility of the crypto market for many months or years to come. As we can
see, Ether and Bitcoin remain resilient and robust enough to make them somewhat
of a safe harbour within the stormy crypto sea.
At the same
time, the collapse in quotations has not yet affected miners' confidence in the
cryptocurrency's future, as the BTC network's hash rate continues to grow. Ray Dalio,
the founder of Bridgewater Associates, one of the biggest hedge funds, said
that bitcoin should be in investors' portfolios.
cryptocurrency itself is not a good competitor to gold in terms of inflation
protection. But that could change in the next five to 10 years.
This article was written by FxPro’s Senior Market Analyst Alex