Crypto Quill

The cryptocurrency market has cooled off for the third consecutive day, falling by 1.7% in the last 24 hours, bringing the total market capitalization down to $2.92 trillion. This marks a retest of the lower end of the recent market range, signaling ongoing position shake-offs. This trend aligns with the broader risk-off sentiment that has prevailed in the global markets this week, with analysts speculating that a deeper correction could bring the market cap closer to $2.73 trillion, which represents the 61.8% retracement level of the previous growth surge.

Bitcoin Consolidates Below $88K

Bitcoin has remained largely unchanged, consolidating below the $88,000 mark for the fourth consecutive day. The cryptocurrency has been trading within the $88K–$89K range, showing limited volatility. On the daily chart, the Relative Strength Index (RSI) is nearing the 80 level, signaling the potential for a deeper pullback, possibly bringing Bitcoin back to the $83,000 level in the near term.

Ethereum Pulls Back to $3,000

Ethereum has also seen a correction, dropping 12% from its recent peak in a four-day retracement. The altcoin now hovers around the $3,000 mark, with local support potentially coming from the 200-day moving average at $2,950, which coincides with a key support area that has been in play since April through July of this year.

PEPE Meme Token Soars as Crypto Market Faces Consolidation

In contrast to the broader market cooling, the PEPE meme token has experienced a remarkable surge, climbing to a record market capitalization of over $9.6 billion. The token now ranks 15th on CoinMarketCap, with its rally attributed to its recent listing on major crypto platforms such as Robinhood and Coinbase. This unexpected momentum in the meme token market provides a stark contrast to the cooling sentiment in the larger market.

Diverging Trends Between Bitcoin and Gold

New research from K33 highlights that Bitcoin’s correlation with gold has fallen to an 11-month low, following the election of President-elect Donald Trump. Since his victory, Bitcoin has surged 20% to new all-time highs (ATHs), while gold has lost 5% amid a stronger dollar and rising U.S. Treasury yields. This divergence signals a shift in market dynamics, with Bitcoin increasingly seen as an alternative to traditional assets like gold.

Institutional Investors Maintain Optimism

Despite the current market cooling, institutional interest in cryptocurrencies remains strong. A survey by digital bank Sygnum revealed that 57% of institutional investors plan to increase their exposure to crypto assets in the coming years. Furthermore, 65% of respondents expressed optimism about the long-term potential of the crypto market. However, the survey also identified high price volatility as the primary barrier to entry for many institutional investors, with 69% of participants citing it as a concern.

Novogratz Predicts $500K Bitcoin with Strategic Reserve

Mike Novogratz, CEO of Galaxy Digital, has predicted that Bitcoin could reach $500,000 if the U.S. establishes a strategic reserve in the cryptocurrency. This proposal, which was also mentioned by President-elect Trump during his campaign, suggests that U.S. government backing could significantly boost Bitcoin’s value, further cementing it as a mainstream asset.

Ethereum Developments: Smart Transactions on the Horizon

In a major development for Ethereum, the platform’s developers have unveiled the concept of ‘smart transactions’, moving the project closer to realizing its vision of becoming a global ‘world computer’. Smart transactions (STXN) will significantly enhance Ethereum’s functionality, enabling a more dynamic set of features and expanding the range of applications and protocols that can be built on the network. This advancement is expected to have far-reaching implications for the decentralized finance (DeFi) ecosystem.