This week saw a spectacular run for the broader crypto market as it crossed $2 trillion in market capitalisation for the first time since May. The investor sentiment warmed up to the market which culminated in a steady rally for days helping the market gain over 11 per cent in the last 7 days. Trade volumes across exchanges also grew despite regulatory concerns and the U.S. Infrastructure Bill debate ending without a conclusion. The news from the crypto world leaned more towards optimism from around the world.
Amidst continued regulatory confusion, many traditional banks and investment houses are increasing their exposure to cryptocurrencies. A Blockdata research posited that 55 banks out of the top 100 banks by assets under management are directly or indirectly investing in cryptocurrencies. The list includes the likes of JP Morgan Chase, Goldman Sachs, BNP Paribas, DBS and others.
The bipartisan US Infrastructure Bill that was presented for debate at the US Senate failed as the senators couldn’t agree on an amendment regarding cryptocurrency reporting and taxation regulations. The bill faced severe backlash from the global crypto community.
Meanwhile, PolyNetwork, a cross-chain DeFi protocol, suffered one of the largest hacks in cryptocurrency history amounting to more than $600 million. However, the hacker subsequently returned the funds.
In terms of price actions, Bitcoin (BTC) finally overcame its 200-day moving average at $45,000 early in the week and sailed past the psychological resistance at $47,000 as the week neared a close after facing some resistance. BTC’s price actions remained range-bound within the $45,000-$47,000 range for most of the week.
Major altcoins added impetus to the growth trajectory with some registering stellar gains. Ethereum (ETH), having crossed the $3,000 mark last week post the London hard fork, sustained its weekly gains and added another 5 per cent to its price over the week. Cardano (ADA) led the pack gaining a substantial 48 per cent over the week in anticipation of its smart contract feature launch due in September. Ripple (XRP) also rallied with a 47% gain. Dogecoin (DOGE), Polygon (MATIC) and Stellar (XLM) had more than 20 per cent gains.
The current market sentiment looks favourable. However, BTC needs to close the week above the $46,000 level to give additional momentum to this rally.