New Delhi: The cryptocurrency market was seen licking the wounds after a sharp sell-off on Saturday. However, the recovery from lower levels stalled as investors chose to further book profits.
Barring the dollar-pegged stable coins and Ethereum, all other seven of the top 10 digital tokens were trading in the red at 9.30 am. Terra, which made its way in the top digital tokens, gave up gains and slid over 10 per cent.
The global crypto market cap shed over a per cent to the $2.29 trillion mark compared to the last day. Meanwhile, the total crypto market volume fell over 40 per cent to 121.49 billion.
Crypto closed the weekend with a sharp decline, triggered by a combination of Evergrande’s debt problems, excessive leverage in the markets, uncertainty in the Fed’s economic policies and continued spread of the Omicron variant, said CoinDCX Research Team.
“Altcoins took the brunt of the selling. While there was some gradual dip buying, it did little to limit the damage done. The coming week is expected to be another volatile session for markets as traders return to the office,” it added.
What’s cooking in India
The Union Cabinet could later this week discuss a legal framework for cryptocurrencies, in which they could propose a complete ban on private digital currencies.
Leaders of global crypto exchanges have said that while India’s messaging on cryptocurrencies has so far been mixed, the proposed bill, likely to be introduced in the Winter Session of Parliament, gives New Delhi a chance to bring in a progressive regulatory framework that could propel the country to the forefront of blockchain technology.
Amid the growing perception that cryptocurrencies could be ‘regulated’ and not banned in India, Kotak has emerged as the first major bank to open its doors to the crypto community.
Expert’s Take
The greed and the fear index are currently at the ‘Extreme fear’ level in India. The new covid variant was one of the reasons behind the drop but the long liquidations led to a cascading effect, said WazirX Trade Desk.
“The crypto space also suffered several hacks. A crypto exchange Bitmart lost more than 200 million in crypto assets while a Defi protocol BadgerDao lost approximately 120 million in crypto assets,” it added.
NFT update
As the crypto market is going through a correction right now, we can expect more downtrends in NFT and metaverse related cryptocurrencies too, said Hitesh Malviya, Founder, Itsblockchain.com.
“NFT based assets are showing positive consolidation since the last few days, and we can expect a possible rally from them in coming weeks because of the launch of coinbase NFT marketplace,” he added.
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