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Crypto wrap: Market volatile on profit booking after last week's rally

The major beneficiary of Bitcoin's weakness has been Ripple's XRP token which now enjoys a market dominance of 21%


Photo: Bloomberg

Raghav Aggarwal New Delhi

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The cryptocurrency markets remained volatile, trading in the range of $29,500 to $31,200 as investors booked profits after last week's rally. On Friday, Bitcoin was trading at $29,781, over 4.5 per cent down in the last seven days, according to data from CoinMarketCap.

Ethereum, the second largest crypto token by market cap, was trading at $1,888, over 5.5 per cent down in the last seven days.

During the week, Bitcoin touched its one-month low of $29,500.

"Following last week's rally, this week has been a little volatile. Over the past 24 hours, Bitcoin has continued to trade below the US$30,000 mark for yet another consecutive day, influenced by various factors. These include investors taking profits after the recent rally and the strengthening of the US dollar," said Edul Patel, co-founder and chief executive officer (CEO) of Mudrex.

This has also led to a fall in Bitcoin's market dominance.

"Bitcoin dominance is close to its 1-month low, as investors are shifting their focus to smaller, riskier tokens," said crypto exchange CoinDCX's research team.

The major beneficiary of this was Ripple's XRP token. After a favourable judgement from a US court that the token is not primarily a security, it has seen a bull run.

"XRP's global trading volumes even crossed Bitcoin's trading volumes on multiple days this week, and XRP now constitutes around 21 per cent of the entire market's volumes in crypto as the traders' interest stays on the rise post registering a historic win against the SEC," said Shubham Hudda, senior manager at CoinSwitch Markets desk.

What next for Bitcoin?

Experts seemed optimistic about the cryptocurrency's near future outlook. This is primarily due to the growing interest of several fund managers like BlackRock in Bitcoin ETFs.

"The approval of Bitcoin's spot ETF application can help the market move upward and reach the projected levels for this year with a potential increase of approx 20 per cent," said Rajagopal Menon, vice president at WazirX.

According to Patel, Bitcoin has resistance at the $30,000 level while support is at $29,600.

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First Published: Jul 21 2023 | 4:36 PM IST

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