Monday, November 28, 2022

Cryptos Declined Amid Choppy Week While DeFi Tokens Underperform

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Cryptos declined amid a choppy week of trading while the DEFI tokens underperformed and aversion to risk still remains with the volatility returning to the markets so let’s read more today in our latest cryptocurrency news.

Cryptos declined as BTC traded in a choppy range in the past week as the volatility ticked higher. This could reflect more uncertainty among the crypto traders. BTC was down by 3% in the past day and it is flat over the week while the alternative cryptocurrencies underperformed. For example, Solana’s SOL token was down by 5% and aVAX token was down by 4% in the past day. The S&P500 on Friday fell into a bear market territory and dropped by more than 20% from the record high back in January. The volatility remains elevated in both the stocks and the cryptocurrencies while gold ticked higher on Friday.

crypto market
Source: Quanitfy Crypto

On the macroeconomic front, many analysts expected the selling pressure to slow down in stocks which can benefit cryptos in the short term. BTC was increasingly correlated with the S&P500 over the past year. The MRB Partners wrote that the company expects a window of opportunity for the equity markets to rebound s the global growth conditions prove resilient and assume the itnerest rates expectations and bond yields will calm down soon:

“It is premature to worry about an approaching recession until the bond market and central banks push monetary conditions into restrictive territory, which we do not expect in 2022.”

The DEFI tokens that underperformed BTC over the past month and usually, DEFI and other altcoins underperformed in a down market because of the higher risk profile that is relative to BTC.

avax totalmarket cap
AVAX total market cap at $8.98 billion on the daily chart Source TradingView.com

As recently reported, The ETH competitor Avalanche slides by double-digits or by 16% amid the market’s ongoing crash. A few tokens backing the ETH killers posted double-digit losses over the past day and Avalanche led the bearish action. AVAX is the native token of the smart contracts platform led by former Cornell professor Emin Gun Sirer and it dropped by 16% in value over the past 24 hours and it is now trading at $27.94. AVAX is the 13th biggest crypto with a market cap of $7.6 billion and today’s bearish action puts the token 80% down from the high of $146 a part of this drop could be attributed to a slowed growth on multiple DEFI projects that are built on Avalanche.

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