Weekly Market Wrap: Bitcoin Holds Firm Near $28K as Altcoins Face the Red Tide
Bitcoin (BTC) remains resilient, hovering near the $28,000 mark despite minor dips over the past 24 hours. The leading cryptocurrency is showing strong support after its brief retreat to $27,200, bouncing back quickly and currently trading around $27,700. BTC's market cap hovers around $540 billion, and its dominance over the altcoins has surged past 50% on CoinMarketCap, reaching multi-month highs.
While Bitcoin stands its ground, most alternative coins are experiencing red in the market once again. Ethereum (ETH), the largest altcoin, is trading just below $1,600, with minor losses exceeding 1%. Other notable altcoins like Ripple, Solana, Cardano, Dogecoin, Tron, Toncoin, Polygon, and Polkadot have retraced by up to 3% in the last 24 hours.
However, there are a few exceptions in the altcoin arena. ATOM and Tezos have shown resilience, with gains of 4.5% and 7%, respectively, within a single day.
Despite the mixed performance among altcoins, the overall cryptocurrency market cap has witnessed a daily decline, now resting at $1.080 trillion.
Ether-Bitcoin Ratio Hits 15-Month Low Amid ETF Struggles
The Ether-Bitcoin (ETH/BTC) ratio has dipped to its lowest level since July 2022, falling to 0.05675 on Monday. This marks a nearly 30% decline since Ethereum's Merge upgrade in September 2022. The drop in the ratio comes as recently launched futures-based Ether exchange-traded funds (ETFs) struggle to gain significant traction.
Despite the introduction of six ether futures ETFs in the U.S. last week, the response from traders has been lukewarm. Leading ETFs like VanECK's EFUT and ProShares EETH have registered an average daily trading volume of around $5 million during their first week, according to data from Paris-based crypto provider Kaiko. In contrast, ProShares Bitcoin Strategy's (BITO) futures ETF saw a massive debut with a first-day trading volume of $1 billion back in October 2021.
The overall crypto market's bearish sentiment has likely contributed to Ethereum's underperformance relative to Bitcoin. Historically, during bear markets, traders tend to favor Bitcoin, the most established and largest cryptocurrency. Ethereum's spot trade volume has also remained relatively flat over the past two months, spiking above $2 billion only a few times.
Bitcoin's dominance in the crypto market has increased from 41% to 51% this year, reflecting a greater preference for the digital gold narrative in times of global fiat uncertainty and geopolitical risk. Additionally, Bitcoin's regulatory status as a "commodity" asset provides it with a favorable outlook compared to Ethereum, which faces greater regulatory ambiguity.
The higher interest rate environment in the macro landscape is considered a disadvantage for Ethereum, often viewed as a "long duration" tech stock in the crypto market. Bitcoin, often referred to as digital gold, tends to perform better in response to global fiat uncertainty and geopolitical risks.
Tezos Surges 7% Amid South Korean Trading Frenzy and Liquidations
Tezos (XTZ) is on fire, shooting up 7.5% while most of the crypto market faces downward pressure. The surge in Tezos' price coincided with a remarkable trading volume spike on South Korean exchanges, especially UpBit, where trading volume reached $39.7 million in the last 24 hours.
This dramatic increase in trading activity is reflected in XTZ's 24-hour volume, surging to $122.8 million, a stark contrast to its 30-day average of $16.8 million. However, this bullish run came with a side effect – significant liquidations, marking a three-month high for the token.
Tezos employs a unique liquid proof-of-stake consensus mechanism, involving network validators known as "bakers" who also partake in governance. XTZ holders can delegate their tokens, which act as votes, to bakers, influencing protocol changes.
Historically, tokens like Bitcoin Cash (BCH), Aptos (APT), 1inch (1INCH), and Immutable (IMX) have experienced similar trading patterns, often following South Korean volume spikes with subsequent liquidation-driven corrections.
While Tezos shines, Bitcoin (BTC) and Ethereum (ETH) are facing modest declines, with Ethereum seeing a 1.7% drop after the Ethereum Foundation sold off $2.76 million in ETH.
XBO Featured Coin of the Week —– XTZ
XTZ powers Tezos, a decentralized blockchain empowering smart contracts and DApps. Founded in 2014 by Arthur and Kathleen Breitman, it raised $232M in a successful ICO and launched its mainnet in 2018.
Tezos thrives on community-driven governance through XTZ holder voting, ensuring adaptability. It also excels in formal verification, assuring smart contract accuracy with mathematical proofs.
XTZ serves as transaction fees and governance participation. Its value fluctuates with market dynamics, adoption, regulations, and sentiment. Tezos offers a secure, adaptable blockchain for various applications.
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Disclaimer: Our content does not constitute financial advice. It is only intended for informational and educational purposes.
