This week’s market volatility was stronger than usual due to the weekend failure of banks that supported cryptocurrencies.
Major cryptocurrency tokens fell as traders liquidated holdings to lock in profits from the previous few days. With more than 8% drops, Dogecoin (DOGE) and Polygon’s MATIC lead the losers.
The two largest cryptocurrencies, bitcoin (BTC) and ether (ETH) have held at support levels, with bitcoin trading at slightly over $24,500 and ether barely moving from $1,650. Shiba Inu (SHIB) plunged as much as 12% following Thursday morning’s controversy around the code of its upcoming blockchain, while XRP and Cardano (ADA) also saw price declines of 4%.
As a decentralized exchange Uniswap, which processes the greatest daily trade volumes among peers, expanded to the network, and BNB Coin (BNB) gained. The transition is anticipated to bring about important advantages for the exchange and the network, including increased users, lower fees, and the capacity to enter new international markets.
While a long-term bullish trend was still there, according to analysts at the cryptocurrency exchange Bitfinex, a shorter-term perspective characterizes the closing phases of a bear market.
According to Bitfinex, the current pullback may be on the verge of creating the higher bottom that has been anticipated over the last three weeks because long-term signs still point to strength in the cryptocurrency market.
“The market has likely reverted to a period of substantial realized losses, according to the net realized profit and loss indicator for bitcoin. So, it’s crucial to keep in mind that we are still in the tail end of a bear market and not the start of a bull market “explained Bitfinex.
The indicator determines the net profit or loss, expressed in dollars, for any particular over a given time frame. It offers a picture of the general market mood, money inflows and outflows, and developments in network profitability.
“While it would be premature to declare that the market has turned entirely positive, the current increase in net realized losses is still much below the high reached during the FTX implosion or the Luna catastrophe. This demonstrates the market’s increased intrinsic strength in contrast to 2022 “the experts for Bitfinex added.
When investors downplayed the long-term repercussions of a regulatory crackdown on crypto-friendly banks and U.S. consumer price index (CPI) data pointed to slowing inflation in the coming months, cryptocurrency volatility this week was higher than usual.