Crypto as a Safe Haven. Finally?

Market Picture

Bitcoin is down 4.1% over the past week, ending near $18,900. Ethereum lost 5.8% to $1290. Other leading altcoins in the top 10 showed mixed dynamics, ranging from a 3.7% decline (Cardano) to a 27% increase (XRP).

Total crypto market capitalisation, according to CoinMarketCap, declined by 2.4% over the week to $928bn. Cryptocurrency Fear & Greed Index fell by 3 points over the week to 24 (“extreme fear”).

Meanwhile, the cryptocurrency market became a safe haven compared to the collapse of major currencies and stock indices.

The beginning of the week raises the question, what is behind the relative resilience of cryptos? This market could be forgotten for a while, as all the attention and capital flows are on flagship assets. Alternatively, it could manifest traders’ inner confidence that peak fear is near and cryptocurrencies are already cheap enough for long-term investors.

News Background

Former MicroStrategy CEO Michael Saylor said that bitcoin would surpass the $69K reached in November 2021 in the next four years. BTC could trade as high as $500K in the next decade if its market capitalisation equals that of gold. Judging by bitcoin’s simple four-year moving average, its bottom is at $20K, Sailor suggested.

Bitcoin’s bear market has yet to reach its final stage, and investors should prepare for further declines. Some participants expressed this opinion in a Cointelegraph poll on Twitter.

Ethereum co-founder Vitalik Buterin said all cryptocurrencies should switch to the Proof-of-Stake (PoS) algorithm. He believes that over the next 18 months, ETH will become much more scalable, which will significantly reduce transaction fees.

Ripple CEO Brad Garlinghouse disagreed with the SEC that Ethereum could be considered unregistered security after the move to PoS.

by FxPro’s Senior Market Analyst Alex Kuptsikevich