TOTAL MARKET CAP

TOTAL VOLUME

BITCOIN DOMINANCE

This past Monday, fueled by the surge of the second largest digital currency, Ether, the value of the cryptocurrency market surpassed $2 trillion for the first time. This milestone came less than three months after the total market value of cryptocurrencies broke the $1 trillion mark on 7 January, which is 87 days. This year alone, Bitcoin has risen more than 100%, helping to drive the cryptocurrency market higher, while Ethereum has risen nearly 190%. Both gains have far outpaced traditional asset classes.

Last weekend, Bitcoin rose above the $60,000 mark once again. Previously, Bitcoin hovered in a narrow range below the $60,000 mark for more than two weeks. Ethereum also hit a record high over the weekend, climbing to $2,190 for the first time. While risk appetite in traditional markets is obviously contributing, solid fundamentals directly linked to cryptocurrency have contributed to the recent upswing. Perhaps one of the most obvious trends is the rapid growth of BTC-linked investment products. One of the most noticeable trends is perhaps the rapid expansion of BTC-linked investment products. For example, the Purpose Bitcoin ETF hit the $1 billion mark in BTC holdings over the weekend, and that’s just one of many. It was also encouraging to see another strong BTC outflow from Coinbase (remember, this suggests that large institutions have been buying and then withdrawing to hold, supporting the price at current levels).

This past Monday, fueled by the surge of the second largest digital currency, Ether, the value of the cryptocurrency market surpassed $2 trillion for the first time. This milestone came less than three months after the total market value of cryptocurrencies broke the $1 trillion mark on 7 January, which is 87 days. This year alone, Bitcoin has risen more than 100%, helping to drive the cryptocurrency market higher, while Ethereum has risen nearly 190%. Both gains have far outpaced traditional asset classes.

Last weekend, Bitcoin rose above the $60,000 mark once again. Previously, Bitcoin hovered in a narrow range below the $60,000 mark for more than two weeks. Ethereum also hit a record high over the weekend, climbing to $2,190 for the first time. While risk appetite in traditional markets is obviously contributing, solid fundamentals directly linked to cryptocurrency have contributed to the recent upswing. Perhaps one of the most obvious trends is the rapid growth of BTC-linked investment products. One of the most noticeable trends is perhaps the rapid expansion of BTC-linked investment products. For example, the Purpose Bitcoin ETF hit the $1 billion mark in BTC holdings over the weekend, and that’s just one of many. It was also encouraging to see another strong BTC outflow from Coinbase (remember, this suggests that large institutions have been buying and then withdrawing to hold, supporting the price at current levels).

Note that although attention is focused on Bitcoin, which accounts for over 50% of the crypto market, it is far from the best performing cryptocurrency in recent days.

Over 7 days, Bitcoin has in fact increased by 5.18% currently, while Binance Coin, the 3rd largest cryptocurrency, has taken off by more than 68% over a week, and by more than 21% since yesterday. It set an all-time high at $578 on Monday morning.

Ripple XRP’s performance is even more impressive, as the cryptocurrency has doubled in value over the past 7 days. The cryptocurrency marked a high of $1.49 on Sunday, its highest value since 2018. However, it is down 1% on Monday.

IS THERE ANY “VALUE” IN CRYPTOASSETS?

Lately, there seems to have been a sudden shift towards criticising cryptocurrencies. We’ve seen criticism from international central bankers or financial regulators, warnings from the market sector, and no shortage of academic criticism. Much of the focus of criticism or opposition is twofold: first, is there any “value” in crypto assets at all? Second, are the rising prices of encrypted assets enough to prove their value? The core lies in the question of “value”. If there is no value at all, there is no attribute of “currency” and the price basis is lost. Therefore, the question must be answered, is there “value” in encoded assets? If so, where is the “value”?

Fiat comes from the Latin “let it be done”, meaning that the currencies we use today, which are fiat coins, hold value only as they are fully backed by full faith and credit in the government that issued them. Since fiat money is not tied to physical reserves, such as a national stockpile of gold or silver, it risks losing value through inflation or even becoming worthless in the case of hyperinflation. If people lose confidence in a nation’s currency, the money is no longer stable in value. This is how paper money replaced trade and barter, because it was a more effective medium of exchange that also dealt with problems of trust and reciprocity.

Therefore, if a cryptocurrency were to replace a fiat currency, it would have to be a more efficient medium of exchange than fiat currencies, while still dealing with issues of trust and reciprocity.
Bitcoin is a more effective intermediary for transactions than fiat money. It is more resilient, and its resiliency will increase as the network grows; it is digital and can be used for international transactions; there are no transfer fees, and transaction fees are much lower. The central technology of all cryptocurrencies, the blockchain, deals more effectively with issues of trust and reciprocity than central banking. In addition, the distributed nature of the blockchain increases the security of the currency and makes it less vulnerable to manipulation or attack by the central bank. Overcoming the mistrust of potential users and becoming known as a legitimate medium
of exchange for legal purposes is the biggest challenge for a cryptocurrency company.