As the recent drama surrounding FTX, one of the largest cryptocurrency exchanges in the world, continues to send shockwaves across the cryptocurrency sector, digital assets are struggling to recover, and the market is counting its losses.
Indeed, over the period of a single week, the total capitalization of the crypto market has dropped from $1.02 trillion to $838.37 billion, losing $179.13 billion or 17.61% during the observed period, according to the CoinMarketCap data retrieved by Finbold on November 14.
Total 7-day crypto market cap. Source: CoinMarketCap
At the same time, the market cap of the crypto’s largest asset, Bitcoin (BTC), has bled $74.66 billion or 18.73%, declining from $398.69 billion to the current $324.03 billion during the previous week.
In terms of the price, BTC has dropped 18.98% over the week, although it is recording some very modest daily gains of 0.59%, currently changing hands at $16,778.
Bitcoin 7-day price chart. Source: Finbold
More pain for the crypto market?
In the opinion of technical analyst Matthew Hyland, the crisis is happening because the market as a whole still has problems that have led to one participant’s shortcomings spilling over onto others, as he explained on November 13:
“This whole space has too many single points of failures. If one exchange or person goes down, it shouldn’t cause the entire market to cave in. But that’s the reality of this market currently. It is VERY risky. Hopefully, the powers at be spread out, therefore, if one fails, we are ok.”
According to him, there could still be more pain on the horizon, as he highlighted on November 13:
Does not feel like this capitulation is over
A lot of people have had to make a choice the last few days
Stay or leave
Some will leave
— Matthew Hyland (@MatthewHyland_) November 13, 2022
Earlier, he observed that the Nasdaq index had recorded one of its biggest-ever bounces late last week, adding that its continuation could alleviate the pressure on the crypto market:
“Better hope it keeps going for the sake of crypto, any pullback likely will just put even more pressure on this market.”