After the fall of a carefully monitored stablecoin roiled digital assets last week, Bitcoin recovered somewhat slightly. That was trading around $30,000, prolonging a period of relative market quiet.
(Disclaimer: This article is not financial advice but for general information use only.)
Gainers
As of 4 p.m. on Sunday, Bitcoin recovered and gained 3.4 percent to $30,350 in New York. The second-largest token, Ether, gained 5%, while others like Avalanche and Cardano gained even more.
Bitcoin dropped to a low of $25,425 on Thursday after the collapse of the algorithmic stablecoin TerraUSD. It threw its whole supporting ecosystem into turmoil. At the height of the market panic, the $76 billion stablecoin Tether suddenly deviated from its dollar peg. It is a fundamental component of cryptoassets.
Among the crypto leaders who shared their thoughts on the event the past week was Binance CEO Changpeng Zhao (CZ).
“These past weeks have proven to be a watershed moment for the crypto industry. We have witnessed the rapid decline of a major project, which sent ripples across the industry, but also a new found resiliency in the market that did not exist during the last market downswing,” CZ tweeted on Sunday.
Facing additional concerns
According to CoinMarketCap statistics, the overall market value of cryptocurrencies has plummeted by nearly $350 billion in the last week to about $1.38 trillion. Bitcoin is down about 60% from its all-time high in November.
While the worst of the TerraUSD impact has passed, crypto markets still face additional concerns, including increasing global interest rates and tighter liquidity circumstances. Chairman Jerome Powell of the Federal Reserve said this week that the central bank would most likely increase interest rates by a half-point at its next two meetings.
But the head of cryptocurrency exchange Matrix, Vasja Zupan, is positive that cryptocurrencies, especially Bitcoin, will recoup in time.
“I’m still long-term positive, particularly on Bitcoin, but I predict considerable volatility for a while, followed by a period of considerably lower volumes at lower prices until we see new all-time highs trending,” Zupan was cited as saying in some news reports.