Crypto Markets Stabilize After $693B Sell-Off
Crypto markets have stabilized, ending a market free-fall that erased $693B from crypto’s market capitalization from May 5 to May 12. Crypto’s market capitalization fell from $1.81T on May 5 to lows of $1.12T on May 12. The market started to rise on Friday, and now rests at $1.28T, data from CoinMarketCap shows. The crash…
By: Aleksandar Gilbert •DeFi News
Crypto markets have stabilized, ending a market free-fall that erased $693B from crypto’s market capitalization from May 5 to May 12.
Crypto’s market capitalization fell from $1.81T on May 5 to lows of $1.12T on May 12. The market started to rise on Friday, and now rests at $1.28T, data from CoinMarketCap shows.
The crash was exacerbated by the collapse of Terra, the stablecoin protocol that fell into a death spiral after traders lost confidence in the volatile token that propped up the network, LUNA.
The six largest tokens by market capitalization rebounded slightly Friday after bottoming out the day before and have held steady since, according to data from Coin Gecko.
The same goes for DeFi, where the combined total value locked (TVL) has stabilized after plunging 45% last week.
On May 5, traders had locked $205 billion in DeFi protocols, according to DeFi Llama. On Friday, DeFi’s combined TVL had fallen to $111 billion and has not budged much since.
Ethereum, which accounts for the vast majority of DeFi’s TVL, dropped to $71.3 billion Friday, its lowest figure since June 2021. As of Wednesday, TVL in Ethereum was just under $71.2 billion.
The price of Ether (ETH), meanwhile, fell from just over $2,900 on May 5 to $1,824 a week later, according to CoinGecko. A day later, it had recovered to $2,000, where it has hovered since.
The same goes for other leading cryptocurrencies. Bitcoin, the largest cryptocurrency, dropped from highs of close to $40,000 on May 5 to lows of not-quite $27,000 on May 12, before resting at just under $30,000.
BNB fell 42% between May 5 and May 12, dropping as low as $233, according to CoinGecko. On Friday, it had rebounded slightly, to $304. Wednesday, it was $303.
XRP was worth $0.455 Friday; on Wednesday it was worth $0.429. Cardano (ADA) was worth $0.591 Friday; on Wednesday, $0.562. Solana (SOL) was worth a little more than $55 Friday, a figure that had not changed much come Wednesday morning. All had recovered at least 20% since their Thursday lows.
All are trading far below what they were to begin the month, however, to say nothing of the fall from the highs many of them hit last year. SOL has suffered the most since May 5, dropping 40% since May 5.
Among those that hit all-time highs last year, however, ADA has suffered the most, dropping 81% since Sep. 2.