If these factors do not change, the crypto market cap could fall below the US $1 trillion.
To see a rise in their value, crypto bulls will have to put in a lot more effort.
Since its all-time highs in November 2021, Bitcoin’s value has dropped by 50% which is $34,000 causing a massive meltdown in the cryptocurrency market. Meanwhile, just as investors were beginning to recover from Bitcoin’s decline, Terra and TerraUSD wreaked havoc on the rest of the market by falling below 80%.
The Terra ecosystem’s demise unleashed a wave of terror and instability, prompting an early self-off season. This negative feeling rippled across the crypto market, causing investors to withdraw their funds and sell their holdings.
Bitcoin and Ethereum, the two most valuable assets on the market, have lost more than 40% of their value since mid-November 2021, according to industry analysts. Bitcoin’s price has moved more than any investor could have predicted in recent months.
Investors are glad that the crypto has finally steadied, with the price hovering around US$29,000, but analysts believe that Bitcoin will continue to fluctuate. According to recent figures, the whole crypto market capitalization has dropped by about 43% in just two months. However, if key parameters are corrected, the market will quickly reclaim its luster.
For the past 20 to 23 days, the crypto market cap has fluctuated between US$1.19 trillion and US$1.36 trillion. At this moment, Bitcoin had gained 3.5 percent, while Ethereum had gained roughly US$1.6 percent, which had partly comforted the investors. However, the cryptos have retreated!
In this Bear Market, the Most Important Metrics to Consider
A bearish crypto market is something no investor wants to confront since it destroys portfolio value and has a high likelihood of causing financial losses to its investors. However, one of the most advantageous parts of a bearish crypto market is that it allows investors to rethink their investments and conduct more research into alternative viable ventures that may survive when prices rise again.
The Fear and Greed Index is a data-driven sentiment indicator that displays the crypto market’s pessimistic mood. Since May 8, when the crypto market hit its lowest point when it lost US$1.7 trillion, the indicator has persistently remained below 20.
Cardano continues to rise 19 percent, according to sources, as the Vasil hard fork is set to launch soon. By mobilizing deposits over the decentralized network, the update intends to increase ADA’s scalability and smart contract capabilities.
Aside from these concerns, the Tether scenario has been difficult for the crypto sector and its investors. The re-launch of the LUNA 2.0 protocol hasn’t helped since LUNA users are still unsure about the protocol’s future. To avoid more financial disasters, the majority of long-term crypto purchasers have exited the market or are opting for alternative centralized, conventional assets.
For the crypto market to rise again, several price measures must shift. Experts feel that the study they presented revealed additional drawbacks. This is mostly due to altcoins’ somewhat more unfavorable circumstances, as well as Asian retail markets’ apparent lack of or loss of excitement for investing in cryptocurrencies.
Crypto bulls must demonstrate far greater capacity to attract additional investors to the industry.