Crypto Market Corrects Lower After Recent Show of Strength
Cryptocurrencies fell sharply on Tuesday, as bitcoin’s reversal from its 50-day moving average and shunned rumors involving Ripple and Coinbase weighed on the market.
The value of all publicly-traded cryptocurrencies fell by as much as $32 billion on Tuesday, according to data provider CoinMarketCap. By the early evening, the market cap was down about $28 billion to $438.5 billion. At the start of the week, the market peaked around $474 billion.
Bitcoin was among the biggest decliners, falling 7% to $10,729. The digital asset bottomed around $10,601 earlier in the day.
Hacked speculated on Tuesday that cryptocurrencies could be poised for a breakout in the not-too-distant future.Price action involving bitcoin certainly confirmed that trend, as the world’s most active cryptocurrency rebounded 20% from the Feb. 26 swing low to test the 50-day moving average. Even with the latest pullback, bitcoin is still in the midst of a broad upward correction.
Ripple’s XRP token was down double-digits earlier, reaching a low of $0.91. Ethereum fell to a low of $810; it would later recover to $818 for a daily loss of around 4%.
Meanwhile, Litecoin declined 7% to $195.64, while bitcoin cash shed 5% to $1,201.61.
At the time of writing, the top-15 cryptocurrencies by market cap were trading lower. Other sizable losses were reported among Monero, EOS, IOTA and Ethereum Classic. Outside the top-15, Nano fell 10% and Lisk dropped 9%.
Trading volumes on the global exchanges averaged $17.1 billion on Tuesday. Bitcoin’s share of the daily turnover averaged 39.5%, easily tops among crypto assets. Tether was the quote currency on more than 14% of transactions.
Coinbase Squashes Ripple Rumors
XRP was a major catalyst behind the recent rally in the market. On Tuesday, it was among the biggest laggards after Coinbase quelled rumors that it had placed XRP on its short-list of of supported assets.
As Coinbase reminded investors on Monday, the exchange has “made no decision to add additional assets to either GDAX or Coinbase.Any statement to eh contrary is untrue and not authorized by the company.”
The only digital currencies supported on Coinbase are bitcoin, Ethereum, Litecoin and bitcoin cash. Rumors have circulated in recent months that the San Francisco-based exchange will add add multiple currencies to the list, chief among them being Ripple’s XRP.
Crypto assets that land on Coinbase become instantly more attractive for investors because it means they can be bought instantly using fiat currency. This could lead to higher trade volumes and higher prices.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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