In the first half of the year, cryptocurrencies experienced everything: both growth and decline. The last one was just the other day. What happened that caused the decline in the exchange rate and which currencies “survived” or dropped slightly?
Reasons For The Cryptocurrency Exchange Rate Drop
The consequence was a drop in the BTC rate to $45,700. By the end of the same day, he was back up to $51,000.
What is interesting is that since February 2021, Elon Musk and his company have made statements that have boosted bitcoin growth. On February 8, Tesla announced a $1.5 billion investment in bitcoin, though Musk himself hinted a little later that any cryptocurrency investment is a risky venture. However, the BTC rate increased rapidly from $35,000 at the beginning of February to $45,000 by the end of the month, reaching a high of $56,000 in mid-February. Tesla’s further policy also demonstrated loyalty and interest in BTC when its management announced selling its cars for bitcoins.
Thus, the rate of the most famous cryptocurrency in April — early May was constantly changing, but in values above $50,000. No one expected that Tesla’s seemingly consistent policy on bitcoins would drastically change (the statement about the non-ecological nature of mining) and bring down the BTC rate.
This time, the law provided and listed all the services that were not included in the previous sanctions of 2017.
Now banks and other financial institutions in China cannot offer and provide any crypto services: account opening, online payments in cryptocurrency, buying and selling tokens for yuan and other fiat currency, settlement in tokens, insurance, loans. Such measures led to the fall of all global crypto-assets in May.
Top 5 cryptocurrencies: what happened to them?
The top 5 currencies, leading in terms of total daily turnover.
- Bitcoin (BTC) is the most popular cryptocurrency with a decentralized management system.
It works on the Proof-of-Work algorithm, which has been under constant criticism lately due to its negative impact on the environment. As mentioned earlier, since the beginning of the year, there has been an increase in the BTC rate from $32,000 to a maximum of $64,863 on April 14. Now the rate is fluctuating around $35,000-40,000, that is, a slight increase since the beginning of the year has been maintained. Experts’ opinions on further fluctuations in the bitcoin exchange rate vary.
The cryptocurrency has grown significantly since January 1, 2021, when its exchange rate was about $736. The all-time high was $4,362.35 on May 12, the result of consistent growth since the end of April. To date, the value of ETH is in the range of $ 2,000-2,400. ETH is back to its April value. Since the beginning of the year, ETH has added 300%.
3. Ethereum Classic (ETC) token takes third place by daily trading volume and 17th place by capitalization size.
It is a hard fork of Ethereum, which appeared in July 2016. The goal of the token is to keep the Ethereum network intact without artificially creating or destroying the blockchain. Like ETH, ETC has significantly increased in value since the beginning of the year: from $7 to $176.16, which was given for it at the auction on May 6. The highest progress could be seen from mid-April (about $20) to May 6 — 880%. In recent days, the exchange rate fluctuates between $45-76. The growth since the beginning of the year is 642-1086% — is greater than ETH.
4. Ripple (XRP) platform token of the same name.
The platform differs from the others by increased cryptographic transaction security and positions itself as an alternative to SWIFT. The XRP exchange rate was around $0.24 on January 1 and peaked at $1.8 on April 14. In recent days, the value of 1 XRP fluctuates between $0.78 and $0.92 — within the range of values at the beginning of April. Since the beginning of the year, the rate has increased by 325-383%.
5. Polygon and its Matic token are next in daily trading volume after XRP, 15th in terms of capitalization.
The Polygon platform is designed to scale Ethereum and turn it into a multi-chain system like Polkadot. Since the beginning of the year, the Matic exchange rate has increased from $0.017 to $1.6, which is an increase of over 9,000%. Matic peaked at $ 2.68 on May 18.
It can be seen that the rate of all TOP-5 tokens in terms of trading volume has increased since the beginning of the year. However, the percentage growth is noticeably different: from 10-20% on BTC to 9,000% on Matic. After the significant growth of the exchange rate, the tops also experienced a significant drop in April-May — over 50%.
Platform Currencies With Increased Transaction Privacy
Let’s look at the behavior of two cryptocurrencies with higher privacy transactions: Monero and Zcash.
They are not in the TOP 10 in terms of capitalization or daily trading volume. But “secrecy” can get them to the top.
- Monero (XMR) is a cryptocurrency created to protect and anonymize transactions. Even the authors of the token decided to remain anonymous. As a result, the names of only two of the seven creators are known. The number of XMR tokens is not limited from above and has now reached nearly 18 million.
Since mid-February, it increased gradually and reached a high of $517.62 on May 7. Then-a sharp drop — $200-245 per 1 XMR. Compared with the beginning of the year, the currency remained in the plus — 25-53%.
- Zcash (ZEC) is a cryptocurrency using zk-SNARK. The technology does not imply the anonymity of users and currency owners, but it promises confidentiality.
If you look at the behavior of the token rate since the beginning of the year, you can see that ZEC started with a price of $64 and to date is fluctuating within the range of $100-138. Significant growth in 5 months of the year — 56-230%. ZEC peaked at $355 on May 12.
TON Crystal In 2021
The graph shows that the change in the exchange rate in January-May was insignificant: an increase since the beginning of the year from $0.37 until mid-March to $0.68 and a subsequent decrease to the price of $0.43-0.44. Since the beginning of the year, the rate has increased by 16-19%.
The whole information flow is screaming that all cryptocurrencies go down, but the example of the tokens discussed in the article shows they are still in the plus since the beginning of the year. Cryptocurrencies have proved to be quite reliable long-term investments, as long as you don’t ride the swings of panic caused by public statements. Tomorrow, Elon will get “off on the right foot” and everything will be fine!