The total market value of cryptocurrency is likely to fall below $ 1 trillion if these 3 metrics do not improve

The total market value of cryptocurrency is likely to fall below $ 1 trillion if these 3 metrics do not improve – Mail Bonus

The total market value of cryptocurrencies has ranged from $ 1.19 trillion to US $ 1.36 trillion over the past 23 days, a relatively narrow 13% range. At the same time, 3.5% Bitcoin (BTC) and Ether (ETH) 1.6% gains for the week are far from encouraging.

To date, the overall cryptocurrency market has fallen by 43% in just two months, so investors are unlikely to rejoice even if the declining triangle is reversed.

Total market value of cryptocurrencies, billions of US dollars. Source: TradingView

Concerns about regulations continue to weigh on investor sentiment, the main example being Japan’s swift decision to enforce new laws following the collapse of the Terra USD (UST) – now known as the TerraUSD Classic (USTC). On June 3, the Japanese parliament passed a bill restricting the issuance of stablecoin to licensed banks, listed cashiers and trusted companies.

Several central currency altcoins rose, but overall sentiment remained unchanged

The Bearish sentiment was clearly reflected in cryptocurrencies as the Fear and Greed Index, a data-driven sentiment meter, went up to 10/100 on June 3rd. The indicator has been below 20 since May 8, when total cryptocurrency lost $ 1.7 trillion. level to reach its lowest level since 27 January.

Crypto Fear & Greed Index. Source: alternative.me

Below are the winners and losers of the last seven days. Although the two leading cryptocurrencies made modest gains, a handful of altcoins with an average size rose 13% or more.

Weekly winners and losers among the top 80 coins. Source: Nomics

The waves rose by 109% after liquidity was returned to Vires Finance and Neutrino Protocol USDN stablecoin re-established its $ 1.00 connection after setting a $ 1,000 daily withdrawal limit on USDT and USDC.

Cardano (ADA) rose 19% as investors expect the “Vasil” hard fork scheduled for June 29 will improve flexibility and smart bargaining power, encouraging deposits to long-uploaded online financial applications.

Stellar (XLM) rose 18.6% after the money giant MoneyGram partnered with the Stellar Development Foundation to launch a service that allows its users to send and convert stablecoins into fiat currencies.

Solana (SOL) lost 8% due to an unexpected production shutdown on June 1, which requires lawmakers to coordinate another network restart after a four-hour failure. The persistent problem has negatively affected the Internet seven times in the last 12 months.

Data suggest further price pressure

The OKX Tether (USDT) premium is a good indicator of China’s retail demand in China. It measures the difference between Chinese P2P and the US dollar.

Excessive buying demand tends to push the index above fair value at 100% and in a bearish market, Tether’s market offer is flooded, resulting in a 4% or higher discount.

Tether (USDT) peer to USD / CNY. Source: OKX

Tether has been trading at a 2% or higher discount in Asian peer markets since May 30th. However, the indicator showed a moderate decline as it bottomed out with a 4% discount on 1 June. Traders were caught red-handed as the total encryption funding failed to break the $ 1.3 trillion resistance.

Perpetual contracts, also known as inverse swaps, have a built-in exchange rate that is usually charged every eight hours. Stock exchanges use this fee to avoid exchange rate risk imbalances.

A positive financing ratio indicates that longs (buyers) demand more indebtedness. However, the opposite is true when shorts (sellers) demand increased indebtedness, which causes the financing ratio to be negative.

Accumulated perpetual future financing ratio on June 3rd. Source: Coinglass

Perpetual contracts reflected a mixed attitude as Bitcoin and Ethereum maintained a slightly positive (bullish) funding ratio, while altcoin rates were opposite. The negative 0.20% weekly rate of Solana is equivalent to 0.8% per month, which is not a big concern for most derivatives sellers.

According to derivatives and trading indicators, the market is in danger of seeing more ups and downs. Evidence of this can be seen in a slightly higher demand for a bearish position on altcoin and a clear lack of appetite buying from retail markets in Asia.

Bulls need to show strength and maintain 1.19 trillion market value support to avoid the increase in indebted sellers, bearish betting and negative price pressure as a result.

The views and opinions expressed herein are theirs alone author and do not necessarily reflect the views of Cointelegraph. Every investment and business involves risk. You should do your own research when making a decision.