The cryptocurrency market, currently valued at $1.41 trillion, shows a 1.5% increase in 24 hours but remains down from last Thursday's high of $1.44 trillion. Over the past week, the performance of individual cryptocurrencies has varied significantly. Bitcoin saw a modest gain of 0.7%, while Ethereum dipped by 1.6%. Among altcoins, Tron and XRP experienced declines of 5.8% and 5% respectively, contrasting with Avalanche's impressive 23% surge and Dogecoin's 4.7% rise.
Bitcoin is maintaining its uptrend, and Ethereum also displays a pattern of higher local lows over the past four weeks, indicating a positive trend. This varied technical landscape suggests a potential shift in leadership among second-tier cryptocurrencies, a common occurrence in evolving markets.
Solana has emerged as a strong market leader in the past month, soaring approximately 130%, though it still trades 77% below its peak from October 2021. On the other hand, XRP and Litecoin, previously leading altcoins, are currently out of favor. Despite showing upward trends in the latter half of the last month, they have faced increased pressure and reversed gains recently, hinting at potential underperformance in the near future.
In the backdrop, crypto media speculates on the Federal Reserve's next move, anticipating a rate cut and its impact on cryptocurrencies. Bitfinex predicts a rebound in risk appetite could spur crypto growth, potentially aligning with Bitcoin's halving in April, providing a fundamental basis for buying. YouHodler, however, expects a delay in policy easing.
It's important to note that the Fed usually initiates rate cuts following significant market corrections, driven by a weakened risk appetite. A rate cut in the first half of 2024 might be triggered by major disruptions in debt and equity markets. The scenario seen in 2020, where BTC plummeted before rallying due to monetary easing and government support, could repeat, suggesting a potential drop below 30K before sparking another bull cycle.
Bloomberg Intelligence forecasts continued growth in the cryptocurrency market, with its capitalization possibly reaching between $8 trillion and $10 trillion in this bull cycle. The growth isn’t solely attributed to the “hype” around the launch of spot ETFs on Bitcoin. Following BlackRock, Fidelity Investments has filed with the SEC for a spot ETF on Ethereum. However, BitGo anticipates that the SEC may continue to deny the launch of spot cryptocurrency ETFs, with Coinbase listed as the digital asset custody partner in the ETF filing.
