Bullish Moves See Cryptocurrency Market Cap Surpass $370 Billion

Conor Maloney
  • Bullish moves accross the board saw the cryptocurrency ecosystem's market cap surpass $370 billion.
  • Various positive developments, coupled with strong fundamentals are helping the market surge.

The market continued to rally this morning, with the MVIS Digital Assets 100 Price Index, a market cap-weighted index tracking the performance of the top 100 cryptocurrencies, up over 4 percent since yesterday. The bullish move saw the cryptocurrency ecosystem's market cap surge past $370 billion.

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The top ten coins are all seeing significant price increases, with Bitcoin Cash (BCH) being up over 18 percent and Ripple's XRP token up 21 percent. BCH is now trading above $1,000, and is entering a hard fork that will introduce Ethereum-like features and increase its block size up to 32MB, allowing for faster transactions and higher volume. $834,654,000 USD  worth of BCH was traded over the last 24 hours.

XRP is doing even better volume-wise, with a huge 24-hour trading volume of $1.8 billion. XRP is trading, at press time, at $0.87 per token. Cryptoglobe reported two days ago in our XRP price analysis that the strong resistance line at $0.70 was being tested repeatedly and was due for a powerful breakout.

The project's many new partnerships have likely influenced the impressive 20 percent jump - Ripple, the company behind it, has partnered with Santander, and the bank has even launched a Ripple wallet signifying the first major collaboration between a cryptocurrency and a traditional bank. SBI Holdings and LianLian International are also among Ripple's new partners.

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Today's increase is the culmination of a gradual two week rally that looks to be more sustainable than the short-lived bounce seen in February, the last time the market saw such an upward trend. Bitcoin is trading above $8,000 with the $9,000 mark within reach. On the fundamental side, no negative news has put a damper on market growth recently. EU authorities are taking steps to regulate crypto exchanges, a move that's being seen as a step towards legitimizing cryptocurrencies as a whole.

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The combination of positive news and adoptive measures seen over the last few weeks could well be behind the rally that has seen the top 25 coins all increase in value over the last 24 hours. The upward trend raises the question of whether the bear market in effect since last December could finally be coming to an end.

Can the Recent Bitcoin Price Drop Delay the Halving?

The recent drop in the price of Bitcoin has hit miners quite hard. As their work is no longer profitable, some of them have had to stop mining BTC, which has impacted the hashrate and the average daily block time. Will it delay the next halving?

The escalating COVID-19 Coronavirus Pandemic has caused panic among investors

In the past couple of weeks, BTC/USD trading has been strongly impacted by what’s been happening in traditional markets. As the coronavirus spread quickly around the world, analysts and investors have started to realize that the global economic consequences would be huge, especially given that no one knows when it will be brought under control.

Faced with the uncertain global climate, investors quickly started selling their assets to adopt a more risk-off approach. Many face big losses and margin calls, pushing them to sell any investments to get cash. This triggered a global bearish movement on every asset class, including cryptocurrencies. Bitcoin, for example, lost up to 168% between February 15th and March 13th, as investors were faced with a liquidity crisis.

‘A liquidity crisis means that investors all rush to the exit doors at the same time, but there are so many more sellers than buyers that investors actually have a hard time offloading their assets for cash’ explains Anthony Pompliano on his blog Off The Chain.

Bitcoin’s Price Fall Impacted Median Confirmation Times

On the Bitcoin blockchain, miners are those creating new Bitcoins every time they solve complicated mathematical equations through a proof-of-work protocol in order to validate transactions and add them to the block. It takes on average 10 minutes to add a new block to the Bitcoin network.

‘Bitcoin miners secure the Bitcoin Blockchain because they get paid in Bitcoins to do so. The Bitcoin Blockchain is secured, to an important degree, by the Bitcoins that the miners earn’ explains Wences Casares, CEO of Xapo.

Miner revenues are directly linked to Bitcoin’s price performance. After reaching the $10,000 level, the most important cryptocurrency on the market fell strongly last week, falling to $3,600 at its lowest level, which means that revenues from BTC mining decreased as well, forcing some miners to switch off their equipment to reduce their costs.

As a consequence, the median confirmation time for a transaction to be accepted and added to the network increased. It went from 6.30 minutes on March 7th to 18 minutes on March 20th. The hash rate was also affected, as it went from 121 quintillion hashes per second on March 1st to 82 quintillion hashes per second on March 18th.

Can This Situation Impact the Date of the 3rd Halving?

If the price keeps bouncing back, then the median confirmation time should keep decreasing and the number of blocks created should rise, which shouldn’t impact the halving date, still currently planned for May 12th.

However, the BTC/USD’s volatility has reached its highest level in 6 years according to the Bitcoin Volatility Index, the situation might not change any time soon, as uncertainty on traditional markets should remain more or less constant, potentially intensifying investor fears.

Even if Bitcoin is still volatile, its price is back to around $6,000, and many investors believe that current levels might be an interesting entry point, especially with the upcoming halving. For Michael Novogratz - CEO of Galaxy Digital, 2020 will even be Bitcoin's year!

Featured image via Pixabay.