Cryptocurrency traders and investors are eager to see a return to week-over-week gains, even if some market analysts view the bull run that buoyed Bitcoin and other crypto assets to record highs as “unsustainable.”
Slowly, however, Bitcoin and most other cryptocurrencies are beginning to recover from the historic crash that occurred last week. But some, such as top 10 coins Polkadot (DOT) and Dogecoin (DOGE), are taking longer to recoup those losses.
Bitcoin's 40% drop to $30,000 had many causes, but cyclical market behavior aside, environmental concerns over how Bitcoin is mined are undoubtedly moving to the forefront of the discussion.
When Elon Musk announced that Tesla bought Bitcoin, it catalyzed a historic price rally, and just as easily, when Elon Musk announced that Tesla would stop accepting Bitcoin as a means of payment, it set off a price crash with almost equal force. Subsequent announcements that China would crack down on energy-intensive Bitcoin mining reignited the panic selling—and environmental discussions.
But once again, Elon Musk’s tweets revitalized the markets. "Spoke with North American Bitcoin miners," the billionaire tweeted on Monday. "Potentially promising." The meeting with North American miners, coordinated by MicroStrategy CEO Michael Saylor, gave birth to a mysterious Bitcoin Mining Council, which seeks to promote the use of renewable energy for Bitcoin.
That appeared to be just the kind of news that Bitcoin bulls needed to hear to get their bullish vibes going again. President Joe Biden’s announcement today of a new $6 trillion budget (did somebody say “brrr brr”?) didn’t hurt either.
Bitcoin is currently trading just below $40,000, which still puts it 1.3% below its closing price over the past week. The price trend remains short-time bearish, but this is still the first time since the beginning of May that BTC shows signs of upward momentum.
Most altcoins follow Bitcoin’s lead
Things have a very similar outlook within the rest of the top 10 cryptocurrencies by market capitalization, with a couple notable exceptions.
While Ethereum is now up slightly for the week (less than 1%) and Uniswap (UNI) is up nearly 10%, other coins like Polkadot and Dogecoin aren’t faring so well.
Dogecoin is, of course, the “joke” cryptocurrency that won the attention of Elon Musk over two years ago. Within the last year, though, Musk has really upped his shilling, routinely tweeting about the cryptocurrency and sending the price soaring higher and higher. DOGE is up 5,690% over the last year.
And yet, Dogecoin investors have arguably suffered the worst since the market crash last week. The coin has fallen from third to sixth in the market cap rankings, down 17% over the last seven days.
That’s second-worst in the past week next to Polkadot. It’s currently trading for around $24, down from a high of $48 prior to the crash. DOT investors remain down 18.45% for the week, and 32% for the month.
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.