As of 9:15 am, New York time, there was an advancement of 3.2% to $30,000 in the largest cryptocurrency this Sunday morning. The second biggest token, Ether, increased by about 4.2%, and there were even larger gains with coins like Cardano and Avalanche.
The previous week was not the best for Bitcoin traders. They were thrown into confusion, perplexity, and hurt after the unravelling of the TerraUSD algorithmic stablecoin, as Bitcoin dipped to a low of $25,425 on Thursday. The market distress hit the $76 billion stablecoin Tether badly. However, in recent developments, the market seems to have started a recovery as the two major cryptocurrencies jumped higher than the previous week.
The Chief Executive Officer of crypto exchange Binance Holdings Ltd., Changpeng Zhao, said via a tweet on Sunday that a new side of resiliency has been spotted in the last downswing of the project. He said, “We have witnessed the rapid decline of a major project, which sent ripples across the industry, but also a newfound resiliency in the market that did not exist during the last market downswing.”
Even after a Sunday recovery, the market value of cryptocurrency has dropped by about $350 billion in the last week to around $1.38 trillion, according to CoinGecko data.
The Future of Crypto
Though it seems as if the crypto market has seen the most terrible part of the Terra USD fallout, other challenges face the asset class. The Chair of the Federal Reserve, Jerome Powell, confirmed one of the feared challenges for the asset class. One of the most difficult challenges is the increase in the interest rate on the asset. Another likely challenge is the issue of tighter liquidity criteria.
Vasja Zupan, President of cryptocurrency exchange Matrix, stated that he remains very optimistic about the trades, particularly Bitcoin. He said he foresees a tough time; the market can be volatile, but it will only be for some time; he believes things will still be normal. He also stated that there will be high volatility for a while before everything returns to normal.