News recap: the crypto winter is thawing

Since 06th January, the cryptocurrency market’s capitalisation has started growing, reaching $1 trillion on 16th January, according to CoinMarketCap. Since the middle of the month, the indicator has remained in the range between $960 billion and $1 trillion. This indicates that the market has fully recovered from the shock of the FTX crash.

Trading activity has increased remarkably. Between 09th and 12th January, the average daily trading volume increased by more than 50% to $40-$50 billion. After the publication of the Consumer Price Index, the indicator even rose to $90 billion on 15th January. However, trading volumes soon dropped to $50-$60 billion.

The Cryptocurrency Fear & Greed Index has moved out of the “Fear” zone for the first time over the past few months. Market sentiment peaked at 52 points on 15th January. Following this, the indicator dropped slightly and remained between 45-52 points, which has not been observed since August 2022.

The volatility of cryptocurrencies has increased significantly. Since 06th January, the 30-day BTC volatility index has risen by 99%, from 1.02% to 2.03%. The same indicator for ETH rose by 23% – from 1.78% on 08th January to 2.19% on 15th January. As of 19th December, the volatility of the coin stands at 1.96%.

Amid positive U.S. inflation data, the cryptocurrency market has grown significantly. The growth was also supported by the liquidation of over $500 million in short positions. After such a sharp movement, there is a high possibility of a slight correction. A lateral price movement is possible until the end of January.

The stock market reporting season affects the crypto market as well. Considering the news about layoffs at large US companies, the unemployment rate will start rising and is set to peak in the first quarter of 2023. Subsequently, the Fed is likely to soften their discourse. With this in mind, it is still too early to expect a full-fledged bullish trend, despite significant market growth.

Gainers (06th – 17th January 2023)

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Most traded coins (06th – 17th January 2023)

Top crypto market driving factors

Overall crypto market

▲ 09.01.2023 – Hong Kong has confirmed its positive approach toward the crypto industry and plans to open up limited retail crypto trading.

▲ 11.01.2023 – The Bloomberg analyst, Mike McGlone, emphasised that despite the not-too-good year of 2022, an increasing number of commodity traders are paying attention to digital assets.

▼ 11.01.2023 – Billionaire, Mike Novogratz, says that challenges lay ahead in the digital asset space after a big “washout” in 2022.

▲ 11.01.2023 – Glassnode: the popularity of the USD Coin stablecoin skyrocketed following the default of the FTX cryptocurrency exchange.

▼ 11.01.2023 – House of Lords members call for stronger crypto regulation beyond the upcoming financial bill.

▲ 12.01.2023 – The annual inflation rate fell from 7.1% in November 2022 to 6.5%t in December 2022. On a monthly basis, prices actually slipped by 0.1%.

▲ 12.01.2023 – El Salvador has passed legislation establishing a legal framework for all digital assets that are not bitcoin, as well as those issued on bitcoin. The law paves the way for Bitcoin-backed bonds.

▲ 12.01.2023 – Twitter is set to launch the Coins feature that will allow users to reward content creators with digital tokens in the form of various reactions.

▲ 13.01.2023 – Cathie Wood, CEO of ARK Invest: digital wallets and blockchain technology were among the game-changing innovations that the equity market largely overlooked in 2022.

▲ 13.01.2023 – U.S. Congress’ “first ever” subcommittee on digital assets has been formed as part of the House Financial Services Committee.

▼ 15.01.2023 – India’s central bank governor has called for an outright ban on crypto.

▲ 15.01.2023 – Over the past four days, traders who tried to short on Bitcoin and altcoins lost a total of $916 million – the largest liquidation loss in 18 months.

▲ 15.01.2023 – Tether USDT processed $18.2 trillion worth of transactions in 2022, ahead of traditional payment processors like Visa and Mastercard.

▲ 16.01.2023 – The Cryptocurrency Fear & Greed Index has risen to the ‘Neutral’ zone for the first time in nine months.

▲ 17.01.2023 – Bank of America: digital currency can fundamentally change the global financial system.

▲ 18.01.2023 – According to Electric Capital, over the past year, the number of developers has increased by 5.4% and has already exceeded the mark of 23,300 people.

Bitcoin (BTC)

▲ 06.01.2023 – According to Glassnode, 27.12% of Bitcoin’s circulating supply hasn’t moved in at least five years.

▲ 10.01.2023 – BlackRock, the world’s largest asset manager, has added bitcoin as an eligible investment to its flagship Global Allocation Fund.

▲ 10.01.2023 – Bitcoin mining firm, Core Scientific, produced 5.8% more bitcoin in December month-over-month – 1,435 BTC and 1,356 BTC, respectively.

▲ 11.01.2023 – Glassnode: realised volatility for the two major assets, BTC and ETH, fell to extreme lows, and that has historically preceded explosive moves in either direction.

▼ 11.01.2023 – British miner, Argo Blockchain, mined 147 BTC in December 2022 – a 25.75% drop compared to 198 BTC mined in November 2022.

▲ 11.01.2023 – Santiment: BTC whales have begun to increase their holdings since January this year. They currently hold a total of 4.57 million BTC, accounting for 23.7% of the total circulating supply.

▼ 14.01.2023 – Bitcoin miners mined a total of $9.45 billion in Bitcoin throughout 2022, which is 43% less than in 2021 when profit stood at $16.7 billion.

▲ 16.01.2023 – Bitcoin’s mining difficulty has climbed by more than 10% to a record high of 37.59 T, while its hash rate is hovering near 271.86 EH/s.

▼ 16.01.2023 – BBG: Bitcoin’s relative strength index is at a two-year high, which may indicate local overbought conditions.
▲ 18.01.2023 – The overall supply of Bitcoin on exchanges has dropped from 11.85% to 6.65% over the past year.

Ethereum (ETH)

▼ 06.01.2023 – At the moment, only 20% of the stakers are in the profit zone amid ETH’s price fall.

▲ 12.01.2023 – Forex Suggest analysts: the successful Merge upgrade marked the green era for Ethereum.

▲ 13.01.2023 – MetaMask announced Ethereum staking feature focused on accessibility.

▲ 15.01.2023 – In 2022, the Ethereum network burned about 1.8 million coins.

▲ 16.01.2023 – Ethereum has hit a ten-week high and turned deflationary again.

▲ 17.01.2023 – CryptoQuant: the number of new smart contracts on the ETH network has increased significantly after a long-lasting decrease from August 2021 to October 2022.

▲ 17.01.2023 – According to data from BeaconScan, Ethereum’s validator count topped 500,000 as of January 2023. Just a year ago, the network had 282,000 validators.

Cardano (ADA)

▲ 10.01.2023 – Cardano’s Total Value Locked (TVL) has climbed by 30% since the beginning of the year, according to DefiLlama.

Solana (SOL)

▲ 06.01.2023 – Since the start of 2023, the number of active Solana users has increased by 55.9% to 160,000.

▲ 10.01.2023 – Google is rumoured to have purchased 2,800,000 SOL at $10. The firm now owns the 13th largest SOL wallet.

▼ 12.01.2023 – The US Department of Justice is investigating a team of two brothers behind Saber, a Solana-based decentralised exchange. The duo is accused of falsifying identities and inflating Total Value Locked statistics.

Litecoin (LTC)

▲ 18.01.2023 – According to Santiment, the Litecoin network is seeing a significant increase in large LTC transactions.

Shiba Inu (SHIB)

▲ 16.01.2023 – Shiba Inu developers announced the beta release of the Shibarium layer-two network. The purpose of the new update is to improve the speed, allow users to create decentralised applications, as well as integrate non-fungible tokens.

Waves (WAVES)

▲ 13.01.2023 – Attempting to rescue the USDN stablecoin, Waves made a decision to convert the stablecoin into the WIXT ecosystem index token.