Despite the speculation recently that the market event in which Tether, the most well-capitalized stablecoin in the world, lost its 1:1 peg on the US Dollar may cause other cryptocurrency to be less attractive, the absolute opposite has happened.
At the end of last week, just after Tether values fell as low as $0.95 the stablecoin moved quickly and the concern waned.
This downward movement immediately superceded the implosion of the Terra algorithmic stablecoin and caused some degree of bearishness over other stablecoins.
However, a question that should perhaps be posed is; Does it matter?
Surely decentralised cryptocurrency is all about circumventing the fiat market and not attaching itself to it, therefore any inkling that the downward trend in some higher profile stablecoins is reflective of the cryptocurrency market is unfounded.
It could even be viewed that stablecoin downturns simply serve to highlight the advantages of decentralised cryptocurrencies which are not tied in any form to any fiat currencies.
This week, nine popular cryptocurrencies have risen in value quite significantly.
Bitcoin, along with altcoins Ethereum, BNB, XRP (Ripple), Solana, Cardano (ADA), Dogecoin (DOGE), DOT, abd AVAX rose by a remarkable 13% in total yesterday, and the total market cap globally for cryptocurrency rose by over 2.7% to $1.31 trillion.
Despite the increase in market cap and the value of these popular cryptocurrencies, overall market volume declined by approximately 9% to $78.40 billion, however that is an interesting metric when considering the overall buoyancy and bullishness of the decentralised cryptocurrency market.
Bitcoin values are now back over the $30,000 mark, which indicates some form of recovery over the market slump that happened during the early part of last week, however whilst the total increment in value of these 9 cryptocurrencies is evident, Bitcoin made a slight decrease in value by 0.26% yesterday.
Even so, the market for popular cryptocurrencies is fairing well this week, especially considering that Bitcoin values went do $26,000 last week representing its lowest point in 6 months.
It appears that there is no correlation between the volatility in the fiat currency markets and the movements of the cryptocurrency markets which are driven by different factors.
Within the major fiat currencies, the Japanese Yen has been quietly doing well whilst the Euro, Pound and Dollar fluctuate due to the severity of inflation, economic woes and involvement in geopolitical problems by their host nations.
By contrast, cryptocurrency is viewed as a way around all the politics and governmental misadventure, therefore its fluctuation is a separate sphere altogether and driven by totally different factors.
FXOpen offers the world's most popular cryptocurrency CFDs*, including Bitcoin and Ethereum. Floating spreads, 1:2 leverage, 30% margin call, 0.01 lot minimum transaction size with no maximum — at your service. Open your trading account now or learn more about making your money go further with FXOpen.
*At FXOpen UK and FXOpen AU, Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules and Professional clients under ASIC Rules respectively. They are not available for trading by Retail clients.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.