We are heading into the Thanksgiving weekend in the US (happy thanksgiving to all who celebrate it!Let’s take a look at the current state of crypto markets. While bitcoin struggles to continue its rise, it is a sign that the market may be reversing. “alt season,” A resurgence of interest in NFTs and record growth in stablecoins.
Bitcoin’s $100K rejection and market volatility
As the holidays approach, volatility is usually reduced by 3-4%.
Bitcoin briefly reached $91,500 in the last week before reversing to about $91,000. The asset has a history of soaring prices followed by small corrections. It may feel like a large drop of $9,000 in just one week, but it’s actually a relatively small amount when viewed on a percentage scale.
The price action is constructive if it holds the upper end of the consolidation range that was earlier this month.
James Toledano (COO of Unity Wallet) attributes the pullback in price to profit taking and put options that are triggered at key resistance levels.
“Crypto markets often see huge volatility due to a lack of a fundamental base for valuations,” Toledano told Blockworks. “Whenever there are oversized gains in a painfully short timespan, the pattern has been that there are usually oversized corrections, and history often has a habit of repeating itself,” He was referring to previous cycles, where Bitcoin surged significantly before the price corrected by more than 50%.
Even though the market is currently in a slump, there’s still optimism, thanks to shifting political winds. For example, new US Treasury and Commerce nominees are crypto-friendly, and institutional interest has grown.
Google searches for Bitcoins have risen post-election. This is a reflection of increased retail interest.
Long tail, NFTs and stablecoins
Not just Bitcoin was buzzing. NFT is experiencing a revival. The floor prices of the 100 most expensive NFT collections increased by an average 28% this November. In some cases, they rose as much as 146%.
This resurgence is driven by a pivot toward NFTs with real-world utility, such as tokenized assets and memberships, but the bottom line is — as with the rest of the market — surging Bitcoin interest often correlates with NFT price increases.
Stablecoins continue to be the foundation of the cryptocurrency industry. In November, the total market capitalization reached an all-time record of $190 billion, which is higher than the previous peak, before TerraUSD’s collapse. CCData reports that stablecoin trading volumes on centralized platforms grew 77.5% in November to reach $1.81 trillion. This is the largest month-over-month increase for this sector since January 2021.
Important Highlights
* Tether (USDT): Market cap rose to $135 billion, maintaining its dominance with a nearly 70% market share.
* USD Coin (USDC): Gained 11%, reaching about $38 billion, its highest since February 2023.
* Ethena Labs’ USDe: Surged by nearly 40%, driven by its competitive APY and ecosystem expansion.
The stablecoin market is also being shaped by the regulatory changes. Euro-compliant stablecoins that comply with MiCA are growing in popularity.
As Bitcoin entered a phase of correction, this week’s attention was focused on other crypto assets like Solana(SOL) and smaller ones. Bitcoin Dominance lost about 5% of its value over the past seven days.
Solana’s record price reached $264 (without inflation) last week, a 160% rise year to date.
Anmol Sing of Zeta Markets listed some reasons. “Solana dominates user engagement with 6.2 million daily active addresses compared to Ethereum’s 500K,” He told Blockworks adding “Solana-based applications are now generating more revenue than Ethereum apps, and with $311 million in stablecoin inflows just [on] November 20, the momentum is clear.”
The ETH/BTC exchange rate has risen by 15% in just one week.
Also, new layer-1 networks, such as Sui and its liquid BTC stake, have gained traction. They use features, like this, to increase adoption. This could potentially threaten Solana’s dominant position on the market.
All eyes will be on Bitcoin for the time being, as well as any new developments in regulatory policy and signs that mainstream adoption is continuing. This bull market will continue to grow and evolve, as the crypto-market thrives off cycles of growth, corrective action, and innovation.
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