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This Week’s Summary
- The Crypto Market ends the week at a total market capitalization of $1,277 trillion.
- Bitcoin is down by roughly 15% after a catastrophic week.
- Ethereum lost almost 21% of its value over the past seven days.
- XRP decreased by nearly 27% this past week.
- Almost all altcoins are trading in the red with almost no exceptions.
- The Terra ecosystem crashed after UST lost its peg and dragged LUNA’s price into the abyss.
- The DeFi sector lost over $15 billion from the Total Value Locked in protocols, which now stands at $56.49 billion.
Crypto Trends 9th to 15th of May, 2022: Market Analysis and Performance
The crypto market is making the headlights for all the wrong reasons. The market capitalization dropped by $300 billion in less than a week, and its primary assets are bleeding by the hour. Moreover, one of the most popular crypto in recent months, LUNA, imploded when it lost its peg. Lastly, traders keep their wallets shut, and new investors are nowhere to be found. In this desolate landscape, saying crypto is drowning in a bloodbath is an understatement.
Bitcoin has dropped below the $30,000 level after losing nearly 15% of its value this week. It’s a bleak period for the king coin, which cannot seem to get a break despite illustrious investors backing it. After the third week of trading in the red, BTC is now trading at only $29,670.
Ethereum struggles to trade above $2,000 as the week comes to an end. However, it may not stay there for long as it records another calamitous drop of over 20%. Last week, investors were hoping for a recovery above $3,000. Unfortunately, this time around, they’re praying for the second crypto in command to stay at least above $1,500.
Altcoins & DeFi
This week’s most infamous event happened in the altcoin sector. LUNA, a coin in the Terra ecosystem and one of the traders’ favorite assets in 2022, dropped from $68 to a dismal $0.00030. This 90% drop in value happened when Terra’s algorithmic stablecoin, UST, lost its peg. UST was the bread and butter for Terra and significantly influenced LUNA’s value. Without it, all investments in LUNA became almost instantly worthless.
The reasons for LUNA’s downfall are still unclear. Do Kwon, Terra’s CEO expressed his “heartfelt” regrets about the situation on Twitter. However, this did not stop a Singaporean investor from filing a police report against him. And this could be only the beginning of a hurricane of lawsuits and legal problems for Do Kwon and his enterprise.
LUNA’s collapse affected the entire market. Most altcoins were already bleeding heavily before the event. Now, they are struggling to keep afloat. For instance, Ripple’s XRP dropped by nearly $0.2 and is currently trading at around $0.42.
Elsewhere, Solana dropped by more than 33% over the week. Cardano lost 27%, Dogecoin dropped by 30%, and Avalanche by over 37%. The only significant asset trading in the green is Maker, with a roughly 27% increase.
All the sectors in the crypto market are bleeding by the hour. And the Metaverse does not make an exception. ApeCoin dropped by almost 30% for the second week in a row. Meanwhile, Decentraland is registering a 9% decrease, and The Sandbox licks its wounds after a 32% drop this week.
Crypto Market Analysis – What’s in the News?
- Some of the most famous crypto data sites have been the targets of phishing attacks.
- Norway’s Parliament has rejected a proposal to ban Bitcoin mining.
- Cardano founder Charles Hoskinson says some institutions are manipulating crypto.
Next Week’s Crypto Market Forecast
The crypto market is facing one of the worst periods in recent history. Consistent asset devaluation, scams, FUD, and the latest LUNA debacle have weakened its appeal to new investors. Nevertheless, the market has solid credibility, which it has built over the years. So, this dark period is unlikely to last for too long. Expert investors know that buying the dip could be a viable opportunity in these dire times.