Bitcoin-led Crypto rally pushes market capitalization above $2 Trillion
Bitcoin is up over 16% in the last 7 trading days, leading the general cryptocurrency rally, with major altcoins like Ethereum, Cardano and Solana gaining over 20% or more. The rally in the market comes after the United States’ Federal Reserve (Fed) began increasing its interest rates.
To notes, the U.S. Fed announced that the interest rate will be raised by a quarter-percentage point to a range of 0.25%-0.5% from its current close to zero level. The central bank raised its benchmark interest rate for the first time since December 2018.
Since the announcement of the interest rate hike on the 17th of March, the cryptocurrency market capitalization has gained over 18%, from $1.82 trillion to current stand at approximately $2.15 trillion, above the $2 trillion mark, a mark it lost in February 2022.
What You Should Know
- According to data from the Blockware Intelligence Newsletter, it explained that the currency combination of strength in both Bitcoin and the Nasdaq is a good sign for crypto-equities and has allowed a few names to stand out from the pack.
- It pointed out CleanSpark, RIOT Blockchain, Silvergate Capital and MicroStrategy as the leading gainers, who have all gained approximately 23%, 30%, 18% and 13% respectively.
- In respect to Long Term Holder (LTH) accumulation, an on-chain analytic metric that that measure the accumulation of wallet address of entities that have a history of not selling their holdings, the report states that the metric is, “showing the most deflationary reading in Bitcoin’s trading history, in other words, long-term holders are locking up supply at a pace that is outpacing the amount of BTC being introduced into circulation every day.”
- The report also mentions that illiquid supply continues to rise. It states, “Supply continues to move to entities who sell less than 25% of the coins that they take in. This is very different from the signature during 2018.”
- It further reads, “Of the on-chain accumulation, it actually appears that some of this (accumulation) has come from smaller entities; with whales’ holdings in a broader downtrend despite a spike over the last few days.”
- Asides from the on-chain analytics, many are attributing the recent rally in the market to the Luna Foundation’s accumulation of Bitcoin for its programmable stablecoin, UST. In March, Do Kwon, founder of Terraform Labs and Terra, an Ethereum layer 1 blockchain competitor, committed to accumulating $10 billion worth of Bitcoin (BTC) to add to the project’s stablecoin reserves.
- The last time Nairametrics report the accumulation, the organization had acquired 24,954.96 BTC, worth approximately $1.1 billion. As of the time of this writing, the wallet balance has increased to 27,784.97 BTC, worth $1.3 billion. This indicates that the foundation has increased its holdings by 2,830.01 BTC, worth $135 million.
With Bitcoin rallying, we are also seeing bullish action from altcoins. Of the top 10, we are seeing Cardano’s native token, ADA, lead the rally, gaining 33% in the last 7 days. Other leaders of the top 10 includes Solana’s SOL token, Ethereum’s Ether token, Terra’s LUNA token and Avalanche’s AVAX token, who are gaining 9.37%, 6.96%, 11.13% and 10.42% respectively as of the time of this writing.