As several equity market indices crash out, the crypto market makes a major recovery with overall market valuation growing by 50% in last one week.
Last week, the U.S. equity market witnessed a heavy beating as the bears took charge over the bulls. Since the global financial crisis of 2008, the Dow Jones Industrial Average suffered the worst weekly performance. The Dow Jones index lost nearly 7 percent or 1,655 points. Also, experts claim that the signs of recovery at this moment look to be very slim.
According to the CNBC report, the latest crash in the equity market was majorly due to the rate hike by the Federal Reserve and the extended government shutdown. Along with Dow, the S&P 500 and Nasdaq Composite lost nearly 2 and 3 percent respectively. The equity market erosion was very much significant, especially in the tech space. Giants like Apple, Amazon, and Facebook all booked huge losses last week.
Komal Sri-Kumar, president at Sri-Kumar Global Strategies, said:
There are lots of signs now suggesting that we may be looking at a recession. I would say that the risk here is that a whole lot of confluence is taking place: The trade was is not going to end soon, and the Fed totally misjudged the market in suggesting two more rate hikes next year.
Cryptocurrency Market Posts Solid Recovery
As the equity market was facing meltdown, Bitcoin and the crypto market has posted a major recovery last week. The overall cryptocurrency market cap has surged by nearly 50% with currently at $145.6 billion. The recovery in the Bitcoin and the altcoin space has helped this recovery.
In the last one week, Bitcoin has recovered nearly 30% from below $3300 to above $4200 levels. At the press time, Bitcoin (BTC) is 5% up trading at $4244 with a market cap of $74 billion. This much-needed recovery for Bitcoin came after the cryptocurrency crashed nearly 50% in the last two months.
During the same period, a majority of the altcoins also corrected by huge levels. Many analysts say that a series of short contracts led to the crypto market crash last month. However, different analysts have different viewpoints on Bitcoin crossing its all-time high of $20000. While some analysts believe that the entry of institutional investors will trigger the price recovery, other analysts say that user-driven approach is more desirable to attain that goal.
On the other hand, XRP has made a considerable 30% recovery in the last one week. XRP surged by nearly 20% today, i.e. the last 24 hours and is currently trading at $0.43 with a market cap of $17.8 billion. XRP still maintains its position as the second-largest cryptocurrency by market cap.
Ethereum has shown a solid recovery in the last one week. Ethereum (ETH) has recovered nearly 80% after crashing heavily over the last two months. At the press time, Ethereum is 10.5% up trading at $145 with a market cap of $15.1 billion. A week back it was trading at sub $90 levels and has made a very fast recovery, and the maximum percentage wise compared to other altcoins.
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