The cryptocurrency market experienced a rapid rise on Tuesday, May 7, with Bitcoin leading the decline among top cryptocurrencies. Some altcoins, such as Solana and XRP, exhibited gains, while others, such as Cardano, mirrored Bitcoin’s bearish trend.
Bitcoin led the decline
Bitcoin (BTC), the world’s leading cryptocurrency, has fallen below the critical $64,000 level and is down 1.12% to $63,412.60 at the time of writing. Despite the price drop, trading activity increased and daily volume increased by 71.55% to $30.31 billion. However, the market value of Bitcoin also decreased, falling to 1.24 trillion dollars.
Ethereum (ETH), the second largest cryptocurrency, mirrored Bitcoin’s decline. The price fell 2.65% to $3,065.74, giving the market cap $368.29 billion. However, similar to Bitcoin, transaction volume increased by 66.20% to $13.78 billion. Considering the largest cryptocurrencies by market value, Zebec Protocol and Render experienced an increase of 9 percent and 4 percent, respectively.
Mixed signals among altcoins
While Bitcoin and Ethereum face negative headwinds, some altcoins have defied the bearish trend. Solana (SOL) made a significant recovery and rose 4.54% to $155.02. The price increase was accompanied by a massive 116.38% increase in trading volume, reaching $3.24 billion in the last 24 hours. XRP (XRP) also managed to survive by holding above the $0.53 level. In fact, XRP registered a slight increase of 0.79% and settled at $0.5377. Interestingly, trading volume increased by a staggering 240.29% to $1.84 billion.
But not all altcoins share the positive sentiment. Cardano (ADA) fell 2.06% to $0.4495, reflecting a broader market correction. Despite the price drop, ADA’s trading volume increased by 65.46% in the last 24 hours, reaching $368.81 million. Memecoins, Dogecoin (DOGE) and Shiba Inu (SHIB), continued their downward trend. DOGE price fell 3.97% to $0.156, while SHIB lost 4.34% to trade at just $0.00002371.
There is entry into BTC ETFs
Interestingly, despite the price decline in Bitcoin, US Bitcoin ETFs recorded net inflows of $217 million on Monday, May 6. This positive development came at a time when expectations for the Federal Reserve to cut interest rates in the near future increased and increased investor sentiment in the traditional stock market. Notably, Grayscale Bitcoin ETF (GBTC) led inflows for the second day in a row, with a single-day net inflow of $3,937 million. However, experts warn that the future direction of Bitcoin ETF flows remains uncertain as the tide turns from outflows to inflows.
Positive sentiment in the US Bitcoin ETF market reflected a broader recovery on Wall Street on Monday. The Dow Jones Industrial Average was up 0.46%, the S&P 500 was up 1.03% and the Nasdaq Composite was up 1.19%. This rise in traditional markets can be partially attributed to the ceasefire agreement between Hamas and Israel, which offers a glimmer of hope for stability in the region.
The cryptocurrency market continues to exhibit volatility, with Bitcoin leading the decline on Tuesday. While some altcoins managed to stay afloat and even post gains, others mirrored Bitcoin’s bearish trend. However, positive inflows into US Bitcoin ETFs indicate continued investor interest in the cryptocurrency space despite short-term price fluctuations. The coming days will be crucial in determining the direction of the cryptocurrency market as the traditional market recovers and geopolitical tensions ease.
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