Get exclusive analysis and cryptocurrency insights on Hacked.com for just $39 per month.
Major cryptocurrencies including Ether, the native cryptocurrency of the Ethereum blockchain network, Bitcoin Cash, and Ripple have recorded relatively large gains in the range of 4 to 12 percent, as the cryptocurrency market demonstrated a $13 billion increase in valuation over the past 24 hours.
Ether, Bitcoin Cash, Ripple
Often, both major cryptocurrencies and small tokens tend to follow the price movement of bitcoin, and depending on the performance of the dominant cryptocurrency, the vast majority of cryptocurrencies in the market either record gains or losses by large margins.
On June 3, the cryptocurrency market experienced a reverse trend. The price of BTC failed to record a major movement in the $7,700 region, while Ether, Bitcoin Cash, and Ripple increased substantially overnight. Tokens including Ontology and Zilliqa have also recorded 12 percent gains, outperforming BTC.
The rally of volatile cryptocurrencies such as Ripple, Bitcoin Cash, Ontology, and Zilliqa demonstrate the willingness of investors to take more risks, despite the ongoing recovery period and high volatility.
Against the US dollar, Ether has performed particularly well, initiating its first noteworthy corrective rally for the first time since April 7. Since May 28, the price of Ether has increased from $500 to $623, by more than 24 percent.
However, traders are not highly confident in the short-term performance of the market and leading digital currencies including Ether and bitcoin due to their low volumes. Currently, Ether has the fourth largest daily trading volume behind BTC, Tether, and EOS, at around $1.9 billion. The large trading volume of Tether, a cryptocurrency whose value is hedged to the US dollar, shows that a significant portion of traders are utilizing the currency to hedge the value of other cryptocurrencies, preparing for a potential drop in the short-term.
While Ether has increased by a large margin over the past week, its trading volume throughout the past five days is around one third of the daily trading volume of Ether on April 7, when it initiated a massive corrective rally from $360 to $800.
Bitcoin’s daily trading volume also remains below the $5 billion mark, which is substantially low given that the volume of BTC was well above $10 billion a few months ago. Considering the minor movement in the price of BTC and the weak volumes of other major cryptocurrencies, it is possible that the cryptocurrency market struggles to maintain momentum in the upcoming days and experience a slight correction.
Investors are generally optimistic in the mid-term trend of BTC and the cryptocurrency market. But, as Blocktower’s Ari Paul noted, institutional investors are expected to take at least three to six months enter the cryptocurrency market with tens of billions of dollars in capital and until then, it remains uncertain whether the market can initiate a bull run back to the $800 billion region.
“Custody isn’t binary. It’s not like Coinbase custody will launch and suddenly every pension will throw $100m into BTC. It takes time for custody solutions to gain trustworthiness. But…I think we’ll have solid third party custody by September of this year,” Paul noted.
Follow us on Telegram.