Bitcoin, the largest cryptocurrency by market cap, rose 1% over the past 24 hours to $47,078.17, although it has lost nearly 32% since setting a record high in early November. While Ethereum gained 0.1% to $3,942.57 in the last 24 hours.
According to CoinGecko, the global cryptocurrency market cap today stands at $2.31 trillion, a 0.2% increase over the past 24 hours, taking the total cryptocurrency trading volume in the last day to $114 billion. According to CoinGecko, the dominance of Bitcoin is 38.5% and that of Ethereum is 20.3%.
Popular DeFi tokens such as Solana, Cardano, Polkadot and Polygon maintained a declining trend over the past 24 hours.
Meanwhile, with bitcoin falling for a second day, propelling the biggest cryptocurrency for a fifth consecutive weekly decline, joining other riskier assets under pressure as central banks took a more aggressive tone on inflation.
A team of Grayscale researchers, including David Grider, said: “The downward pressure that has historically existed at the end of the year has continued to keep prices low.”
Central banks globally are prioritizing the fight against increased inflation by tightening monetary settings, while also monitoring the effects of Omicron. Against that backdrop, investors are questioning whether so-called riskier assets such as cryptocurrencies and technology stocks are due for a rough patch after rising from pandemic lows.
Crypto proponents have long argued that bitcoin and other digital assets, by virtue of their being a distinct asset class, can act as a hedge against inflation and swings in other areas of the financial market. Only 21 million bitcoins will be put into circulation under the computer protocol that governs the issuance, although this figure is not expected to reach several decades.
Academics such as Christian Catalini and Antoinette Schauer of the Massachusetts Institute of Technology, who have studied the area extensively, say the “digital gold” argument abounds.
During an interview with Bloomberg News, Catalini said, “All the data to date contradicts the hypothesis. He cautioned that it may still be too early to make this decision as the cryptocurrency is a little over a decade old.
(with inputs from agencies)
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