Altcoin prices briefly rebounded, but derivatives metrics predict worsening conditions
On May 12 the total crypto market capitalization reached its lowest close in 10 months and the metric continues to test the $1.23 trillion support level. However, the following 7 days were reasonably calm while Bitcoin (BTC) gained 3.4% and Ether (ETH) added a modest 1.5%. Presently, the aggregate crypto cap stands at $1.31 trillion.
Ripples from Terra's (LUNA) collapse continue to impact crypto markets, especially the decentralized finance industry. Moreover, the recent decline in traditional markets has led to a loss of $7.6 trillion in market cap from the Nasdaq stock market index, which is higher than the dot-com bubble and the March 2020 sell-offs.
On May 17, U.S. Federal Reserve Chairman Jerome Powell confirmed their intention to suppress inflation by raising interest rates but he cautioned that the Fed's tightening movement could impact the unemployment rate.
The bearish sentiment spilled to crypto markets and the "Fear and Greed Index," a data-driven sentiment gauge, hit 8/100 on May 17. This is the metric’s lowest value since March 28, 2020 and two weeks after the generalized crash that sent oil futures to negative levels and brought Bitcoin (BTC) below $4,000.
Below are the winners and losers from the past seven days. While the two leading cryptocurrencies presented modest gains, a handful of mid-capitalization altcoins rallied 15% or higher.
Monero (XMR) rallied 22% as investors awaited the "tail emission" to be implemented at block 2,641,623 or sometime around June 4. The community decided to include a 0.6 XMR minimum reward in every block, so miners are not 100% reliant on transaction fees.
Cosmos (ATOM) gained 16.5%, a movement that seems a part of a broader retracement that started on May 12 when ATOM fell to
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