Although the crypto market, including Bitcoin, went through a sharp drop in its valuation after Coinbase went on to report a quarterly net loss of $430 million, all is not lost.
While we wouldn’t go as far as to say that this was simply a drop in the ocean, the total market crypto cap faced a drop of 39% from its valuation of $1.81 trillion to $1.10 trillion in just over seven days- which was quite an impressive correction even for an asset class that was this volatile. A similar decrease in the valuation was seen in February 2021- which went on to create multiple bargains for the risk-takers.
Bitcoin Didn’t Get Affected Too Badly By The Market Downturn
Even with the volatility created this week, there were still a few relief bounces as Bitcoin went up by 18% from a low of $25,000 to $30,000, and the price of Ethereum went up to $2,100 after dropping to a year low of around $1,700. Most of the institutional investors did purchase this dip- as reported by data from the Purpose Bitcoin ETF. The exchange-traded instrument has been listed in Canada, and it went on to add around 6,903 BTC on the 12th of May.
The aggregate market valuation of all cryptocurrencies- including the spearheads like Bitcoin and Ethereum- went down by 19.8% over the last seven days, and does currently stand at a sum of $1.4 trillion. However, there have been some mid-capitalization altcoins that dropped and decimated by more than 45% in a single week. Although TerraUSD succumbed completely to the downturn in the market, DAI remained functional fully. Also, Maker went on to benefit from the demise of another competing algorithmic stablecoin.
For Ethereum and Bitcoin, the absence of sellers in the futures markets should be seen as a big positive. Also, one has to take into account the modest bullishness from most of the Asian retail traders- which could be interpreted as something extremely healthy.