The Crypto market capitalization has fallen below $1 trillion. The current $991 billion aggregate valuation devaluation to the peak value of $2.9 trillion on November 11, 2021.
The time series trends, therefore, show that the market has been on a downward streak in the current year and the trend is unlikely to reverse in the short term.
The main factors triggering the crypto winter include; the deepening global financial, economic, and political crises. For instance, the Federal Reserve has been hiking the lending rate to mop up liquidity in the market. On the other hand, politicians are tightening regulations on Crypto in a move that will likely disrupt market operations in the short term.
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Digital Currencies Are in The Red
The Crypto market has lost some ground in the week-on-week trend analysis. Bitcoin, the dominant Crypto, has shed 13% of its value and is now trading at $18,823.82 at the time of press. The bears are cooling off, and BTC has narrowed its losses. On Sunday, the daily transaction volume increased by 46% to 1,856,232 BTC with a dollar value of $35 million.
Ethereum, the largest Altcoin, has shed off over 24.41% of its value week-on-week. The Digital Coin is now trading at $1,306.13 and is unlikely to recoup its ideal price of $2,000. The performance is unexpected. The Ethereum mainnet has a merge where the Proof of Work (PoW) consensus mechanism is upgraded with an environmentally friendly Proof of Stake (PoS) code.
Unlike BTC, whose losses are easing, ETH is on a steeper descent, having lost 10% of its value in the last 24 hours. In the meantime, Ethereum community members expect a hard fork leading to a split that could water down the value of ETH.
The bearish trend is common in the market. Other major Cryptos such as DOGE, SOL, and ADA are losing ground. XRP is one of the best-performing assets, with a narrow loss of 1.25% week-on-week.
Bearish Trend is Reversing
As the new week unfolds, investor confidence is high, and the Cryptos are in the green. In the last hour, BTC has gained 0.1% at the time of press. Bitcoin hit an intraday peak of $20,086 when the market opened in Asia. A market correction has reversed the gain to over $18,000 due to investors’ activities in the EU.
ETH has also gained 0.7% of its value on Coinmarketcap, and the trend is unlikely to change when Western investors become active.
Investors Can Buy the Dip
From an investment point of view, investors have an opportunity to buy the dip. There is proof and consensus that Cryptocurrencies are long-term investment instruments. Digital Assets offer an alternative to tech stocks that are volatile and risky. Digital Currencies, therefore, offer high risks and high rewards to risk takers.