Wednesday, September 27, 2023

Almost Every Crypto Asset Is Down Over 90% From Peak

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Key Takeaways

  • Data from crypto price aggregator CoinGoLive shows that 98.5% of all cryptocurrencies are down more than 90% from their all-time highs.
  • Around 95.5% of cryptocurrencies have fallen by more than 99.99% from their peaks, with the vast majority effectively plummeting to zero.
  • The total crypto market cap is trading 70% from its peak, with Bitcoin’s market dominance at around 42.9%.

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The seven-month-long cryptocurrency bear market has exposed a painful reality: the vast majority of cryptocurrencies eventually lose practically all of their value.

Crypto Crash Exposes Painful Reality

With few exceptions, virtually all crypto assets have now lost more than 90% of their value against their all-time highs. 

According to data from the crypto price aggregator CoinGoLive, 13,240 or 98.5% of the 13,436 cryptocurrencies in existence are currently down 90% from their all-time highs. Of the 196 coins that have retraced less than 90% from their highs, 19 are stablecoins, meaning the exact percentage is slightly higher.

Judging by the size of the pullback from their record prices, the best-performing significantly capitalized coins are BNB, Bitcoin, FTX, TRON, and Ethereum, with respective drawdowns of 68.9%, 69.1%, 72.4%, 75.1%, and 77.14%. Interestingly, Bitcoin’s market dominance, which has historically fallen during bull markets and risen significantly during bear markets, is 42.9%, or roughly the same now as it was during the crypto market’s peak last November. Ethereum’s market dominance, on the other hand, has fallen from around 18.5% to 14.9% over the same period.

Looking more deeply at the data reveals another alarming fact—namely that 12,836 or 95.5% of all cryptocurrencies on the market have fallen by more than 99.99% from their all-time highs. For a vast majority of cryptocurrencies in this bracket, a drop of this magnitude effectively means that their price has fallen to practically zero.

The only asset class that hasn’t suffered a significant drawdown in market capitalization is stablecoins. Despite the $18.6-billion blowup of Terra’s UST, the current total market capitalization of stablecoins is around $157.8 billion—not much lower than its record size and roughly $24 billion higher than the size of the largest smart contract platform on the market, Ethereum. This is especially interesting considering that a significant portion of stablecoins is issued as ERC-20 tokens on the network. 

With inflation at 41-year highs and more aggressive monetary tightening policies from global central banks on the horizon, expert expectations are that risk-on assets like stocks and cryptocurrencies may continue extending losses. With the global crypto market 70% short of its peak, further losses could mean an even greater percentage of coins effectively going to zero.

Disclosure: At the time of writing, the author of this piece owned ETH and several other cryptocurrencies.

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