Several Layer 1 coins are down today amidst a wider market selloff.
Measures of sentiment in the market suggest that fear may be peaking.
It is possible that factors and conditions in the world at large may be contributing to the downward price momentum.
Share this article
Many popular Layer 1 projects in the top 100 are down today amidst an overall market selloff. While the cause is unclear, possible factors include a new Covid variant, fears over Chinese debt obligations, and uncertainty regarding the Federal Reserve’s plans for bond purchases.
Crypto Markets Shaken
Several Layer 1 protocols have suffered losses during a wider selloff that has shaken crypto markets over the weekend.
The big losers of the week are Cosmos, Fantom, Elrond, and Harmony. At the time of writing, Cosmos’s ATOM was down 15% on the week, Fantom’s FTM was down 29%, Elrond’s was EGLD down 31%, and Harmony’s ONE was down 35%.
While many coins are down 15 to 30% on the week, the notable exception is Terra’s LUNA. LUNA is up around 19% on the week despite its 6.5% correction today. Furthermore, much of the market seems to be bleeding against ETH, which is currently holding above $4,000 despite an overall drop of roughly 4% on the week.
It is not just Layer 1 protocols that have suffered the past few days. Even Metaverse tokens like MANA and SAND, which have been performing quite well recently, are each down roughly 27% over the past week, and the total cryptocurrency market cap has fallen to $2.25 trillion from nearly $3 trillion in November. The commonly cited Fear and Greed Index places current sentiment at an “Extreme Fear” level of 16 (out of 100), dropping below last week’s rating of 33. Last month, the indicator showed a greedy market at 71.
While many may be perplexed by the state of the current cycle, it appears that there are many possible non-cryptocurrency-specific reasons for the fear in the market. In recent months, negative crypto-specific catalysts, such as regulatory concerns, have seemed particularly pertinent; however, the current downtrend may have more to do with other externalities originating from outside of the crypto space itself.
While reasons for the selloff remain uncertain, likely contenders could be fear surrounding the new Omicron Covid variant, as well as renewed uncertainty surrounding China’s massive real estate developer Evergrande. There also appears to be uncertainty regarding the Federal Reserve’s timeline for tapering its bond purchases.
Disclosure: At the time of writing, the author of this piece held ETH, LUNA, and several other cryptocurrencies.
Share this article
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
Crypto Assets Slide, Financial Markets Brace for Volatility
The crypto market experienced a drawdown Monday, with several Layer 1 chains registering double-digit losses. Bearish sentiment in traditional markets is likely affecting crypto prices. Crypto Market Drops It’s been…
Tether Owns Billions In Chinese Debt: Bloomberg Report
A Bloomberg report has claimed to have found that Tether holds billions of dollars worth of Chinese commercial paper. Investigation Raises New Concerns Today, Bloomberg BusinessWeek reported that stablecoin issuer…
Infrastructure Bill Crypto Broker Update Sparks Confusion
The Senate’s bipartisan infrastructure bill has updated its definition of a broker for tax reporting of cryptocurrency transactions. However, the update has come across as unconvincing to experts. Infrastructure Bill…
How SocialGood Is Offering 100% Crypto Cashback on Online Shopping
In recent years, the rise of Bitcoin and tokenized assets has made the cashback vertical ripe for disruption. Within the cashback market, blockchain-based loyalty networks are rising in popularity among…