Bitcoin, Ethereum see modest gains heading into Christmas

This week in coins

This week in coins. Illustration by Mitchell Preffer for Decrypt.

The cryptocurrency market is limping into the new year, but the week leading up to Christmas brought very modest gains for the two major coins.

As of Saturday morning, Bitcoin (BTC) is up nearly 1% over the past seven days and Ethereum (ETH) is up nearly 4%, according to data from CoinMarketCap.

Top memecoin Dogecoin suffered significantly heavier losses this week. The value of a DOGE is 8.8% lower than this time last week and is currently trading at $0.077119.

Dogecoin’s popularity dropped this week as the cryptocurrency’s number one fan, Twitter/Tesla CEO Elon Musk, he tweeted a poll asking if he should step down from Twitter. The majority of respondents, around 10 million people, voted “Yes”. Very damn, very ouch.

Double-digit percentage losses were felt by holders of Solana (SOL), which plunged 15% to $11.86. Cardano (ADA) is down 13% to $0.259728, Polkadot (DOT) is down 14% to $4.47, Avalanche (AVAX) is down 10% to $11.78 and Quant (QNT) is dropped 12% to $105.

Ethereum Classic (ETC), Uniswap (UNI), Litecoin (LITE) and Polygon (MATIC) all posted similar losses of around 9%.

Finally, there were whispers in Washington this week that the FTX debacle could mean the end of centralized cryptocurrency exchanges.

The SEC has stepped up its assault on the cryptocurrency industry via the probe. The agency is targeting FTX bigwigs for securities fraud by labeling the exchange’s native FTT token as a security. It’s a subtle semantic shift, implying that the SEC now views the token as a security in itself regardless of how it was marketed to consumers.

With another year drawing to a close, it’s worth zooming out and considering where 2022 fits into the crypto narrative. It’s been another roller coaster year, but unlike the heady highs of 2021, this has definitely been a painful trough for everyone in the industry to one degree or another.

Bitcoin has more than halved over the year (although there is still a week left for a miracle to happen) while Ethereum has depreciated by a factor three. Such heavy losses between the two market leaders obviously did not bode well for the broader market either.

But this was a year in which the industry needed to learn important lessons, and it did, through an age-old and proven method: bankruptcy.

At the heart of the 2022 race to the bottom were the historic collapses of the Terra ecosystem (both LUNA and its algorithmic stablecoin UST) and the centralized exchange FTX. Contagion from both events spread throughout the industry, driving many companies out of business and providing us with case studies on what not to do.

Interestingly, Bitcoin’s popularity among retail investors — ordinary Joes versus institutional investors, such as Tesla and MicroStrategy — has grown exponentially over the year. In 2020, only 12% of total supply was in the hands of people, but by now that figure has risen to just over 17%a percentage higher than all time.

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