Crypto Eco-System Thriving Despite Price Headwinds, Analyst Says; Bitcoin Reports Modest Quarterly Gain

Amid the cryptocurrency bloodbath, Bitcoin reported good news in the last quarter, registering a modest 3.7 percent growth.

Bitcoin was trading around $19,392, having made a comeback in recent days. The biggest cryptocurrency performed well in comparison with other coins. There was a 7 percent declines in MSCI's all-country stock index in the corresponding period, according to Bloomberg analysis.

Better Showing

The agency reported Bitcoin's better showing could be a sign that cryptocurrency prices may have stabilized after they went into tailspin earlier this year.

Bitcoin

"It appears Wall Street believes crypto is close to the bottom and will become an attractive diversification strategy once the peak in Treasury yields is in place ... Despite all the doom and gloom on Wall Street, calls for another crypto crash have been somewhat quiet," Edward Moya, senior market analyst at Oanda Corp, said, according to Bloomberg.

The largest cryptocurrency hasn't fared well since reaching an all-time high price of $69,000 in November 2021. Moreover, it hasn't been above $50,000 since December 25, 2021.

Promising Gains

The world's number one cryptocurrency saw a nearly 70% drop in value since its all-time high above $68,000 on November 10. The cryptocurrency was impacted by surging inflation, lagging recovery in the job market, and the US Federal Reserve's push to wind down pandemic measures to support the economy. Though Bitcoin entered 2022 on a high note, it has been challenged by macroeconomics, including the geopolitical tensions between Russia and Ukraine.

The new analysis says that though the gains are marginal, it compares much favorably with the previous quarter, in which the BTC had lost almost 60 percent.

In other good news for the cytptoverse, the Ethereum Merge helped allay fears of extended uncertainty. Ether, which lost 70 percent in the previous quarter, also came back strongly to gain 32 percent in this quarter.

Ethereum and bitcoin
Ethereum and bitcoin Reuters

"The Ethereum merge was a strong Q3 2022 narrative ... Although we saw a post-merge dip in prices, the success of this watershed event bodes well for the space," said Darius Sit, co-founder of Singapore-based crypto investment fund QCP Capital, according to Bloomberg.

The new developments show that even though the cryptocurrency prices are seeing an unprecedented setback, the crypto ecosystem is actually growing and getting stronger, another analyst said. "Developers are focusing on building the technologies," said Cici Lu, chief executive officer of Venn Link Partners Pte.

Related topics : Cybersecurity
Join the Discussion
READ MORE