Bitcoin, Ethereum Gain Amid Risk-On Sentiment
By Laxmikant Khanvilkar
Leading cryptocurrencies such as Bitcoin, Ethereum etc continue to extend gains on investor frenzied buying that was driven by strong technical signals and rock bottom prices.
The market has become increasingly enthusiastic about taking on risk in the new year, sparked by the expectation that inflation will slow and the Federal Reserve will stop raising interest rates. This reaction speaks to the large amount of cash lying idle waiting for potential investments and the tendency for investors to look for bargains. Even with a series of negative reports, the cryptocurrency market has shown a degree of resilience.
Bitcoin has surged above $21,100 mark while Ether is approaching $1,600.
Michaël van de Poppe, founder and CEO of trading firm Eight, said that Bitcoin might indeed consolidate due to changes in flagging United States dollar strength.
The global crypto market capitalization has risen 1.28% to $993.17 billion in the last 24 hours. Total crypto market volumes surged 18.34% to $54.14 billion, with decentralized finance (DeFi) accounting for 8.24%. Stablecoins, meanwhile, make up 89.60% of the total crypto market 24-hour volume, having grown to $48.51 billion. Bitcoin’s market dominance has also grown 0.26% to 41.19%.
Meanwhile, the total market capitalization of smart contract platform Cardano ($ADA) has surpassed that of popular meme-inspired cryptocurrency Dogecoin ($DOGE), at a time in which $ADA has been recovering from its second-largest drawdown ever. At the time of writing, Cardano is the eighth-largest cryptocurrency by market capitalization after surpassing the $12.09 billion mark.
Risky assets will continue to follow key events including quarterly earnings for equities. Also, the Fed will deliver speeches this week. This will provide insight into the rate hike prospect next month. As ever, the correlation between crypto and stocks can still play a role in the event of a surprise.
United States economic data will keep flowing, while corporate earnings could add volatility to stock markets this week.
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