LBX Weekly Market Overview 21st August: A ride on the crypto carousel with LBX, The London Block Exchange
Last week, the total crypto market cap dropped below £160 ($200) billion for the first time this year, as alternative cryptoassets continued their capitulative process. What happened?
By the end of July, altcoins' performance decoupled from bitcoin’s as the original cryptoasset remained stable and its competitors started falling. Then, last Monday, ether – the token that powers Ethereum, a blockchain that enables decentralised applications and facilitates crowdfunding – faced another major fall, which triggered 20% to 50% losses across the board. Fingers were pointed towards competing projects which raised funds in ether. The claim goes as such that these might have gone short before dumping their holdings on the market.
Zooming out, the truth is that the sun's rays from the holidays hasn’t been strong enough to warm up investors who are still burnt from the downtrend that started last winter. Still, some traders found solace risking catching falling knives. How? Following the generalised dump, several altcoins managed to appreciate 20% to 100%, provided one was able to buy them at the bottom, of course. More importantly, another gamble will take place this week. The cryptosphere has been eagerly awaiting for the US SEC’s approval of a major ETF – a financial instrument that enables institutions to gain exposure to a cryptoasset. So far, all filings have been rejected, and the market has even reacted negatively during times when a decision has been postponed. But, this Thursday, the SEC faces the final deadline regarding the submission of ProShares, a popular ETF provider. Experts claim it has no chance of being approved, and many anticipate another crash. However, if markets behaved the way everyone expects them to behave, then anybody could become wealthy.
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