Weekly Cryptocurrency Market Performance Report (20th August — 26th August 2018)
By: Joel Smith
Tags: Cryptocurrency Investment, Cryptocurrency, Crypto, Bitcoin, Cryptocurrency News

The market cap of cryptocurrencies is a product of the volume of the currency and its price. The top 10 cryptocurrencies comprise almost 86% of the total market cap of cryptomarket at the time of writing. Over the week, the market cap of top 10 cryptos increased by almost 1%, from $181 billion on 19th August to $183 billion on 26th August.

*Tether (USDT) has replaced Cardano and moved one rank above to claim 8th spot in the top 10. It jumped to 8th spot pushing down the Cardano (ADA) to 9th spot with a market cap of $2,803 million. Cardano (ADA) holds the 9th spot with a market cap of $2,381 million.

Conclusion

The Bitcoin price has increased from $6,300 to $6,700 over the week recording a decent increase in its daily volume. Ethereum-based tokens like Wanchain, Aion, and ICON recorded solid gains in the range of 10 to 20 percent against both the US dollar and Bitcoin, showing some momentum against major cryptocurrencies.

Ethereum, Ripple, Bitcoin Cash, and EOS, the top five cryptocurrencies in the global market, have struggled to demonstrate a recovery in their volume and price, closing the week with mere 0.3 to 1 percent gains, falling behind Bitcoin and the rest of the market.

Last week, researchers at Diar reported that the rate of Bitcoin’s volatility has dropped to a 14-month low, as BTC demonstrated stability in the mid-$6,000 range since August 6, for around three weeks. As seen in previous 80 percent corrections and rallies in 2012, 2014, and 2017, Bitcoin has traditionally required a period of stability before initiating a large rally on the upside.

Hence, the BTC price demonstrating stability in the range of $6,300 to $6,700 over the past three weeks is positive, but BTC will need to show months of stability before establishing a strong foundation to support its next big rally.

In previous reports, CCN noted that the dominance index of BTC, which measures the dominance of the cryptocurrency over the global market, is an important metric to measure the short-term growth and momentum of tokens and small market cap cryptocurrencies.

This week, the dominance index of BTC has increased from 51 percent to 53.6 percent, despite the recovery in the price of BTC. Under normal circumstances, tokens tend to demonstrate 10 to 20 percent gains if BTC rises by 3 to 5 percent in value, as investors become more confident in investing in high-risk and high-return trades. However, this week, tokens have not been able to record large movements on the upside.

Bitcoin’s strong dominance over the market suggests that investors are thoroughly convinced that the corrective rally from $6,200 to $6,700 has established a platform for the rest of the market to continue a short-term rally over the upcoming weeks.

While many analysts have suggested that the momentum of Bitcoin will likely enable the dominant cryptocurrency to surpass the $7,000 mark, it may take Bitcoin to break out of the $7,000 resistance level for BTC to see a rapid increase in value in the short-term.

Throughout the past few months, BTC has declined by more than 30 percent, from the $9,000 region to mid-$6,000. Tokens have fallen 60 to 70 percent against Bitcoin, recording 95 percent losses against the US dollar.

Erik Voorhees, the CEO of ShapeShift, one of the most popular peer-to-peer digital asset exchanges in the market, has said that the bear market is not over for crypto but it is a good time to accumulate given the low price range of most cryptocurrencies.

Most investors still expect the price of Bitcoin to endure one last minor correction before initiating a mid-term rally but the general sentiment around the crypto market remains positive.

Disclaimer:

This publication is provided by Invsta in good faith for general information purposes only. Information has been prepared from sources believed to be reliable and accurate at the time of publication, but this is not guaranteed. Information, analysis or views contained herein reflect a judgement at the date of publication and are subject to change without notice. This is not intended to constitute advice to any person. This does not constitute advice of a legal, accounting, tax or other nature to any persons. You should consult your tax adviser in order to understand the impact of investment decisions on your tax position. Past performance is not indicative of future results, and no representation or warranty, express or implied, is made regarding future performance. Cryptocurrencies are a highly volatile, high risk investment in which the value can change significantly. Before making any investment you should consider your own risk tolerance level and personal financial situation.