The cryptocurrency market capitalization has retreated to levels seen in early November, when Donald Trump’s election win sparked a breakout that pushed the market beyond a long-standing resistance level.
Bitcoin (BTC) is on the rise again, nearing $80,000 after dipping below $75,000 late Monday, triggering a rally across the crypto space.
Dogecoin (DOGE), Binance Coin (BNB), XRP, and Cardano (ADA) surged as much as 10%, helping to offset some of the losses from the previous 24 hours. The CoinDesk 20 index, tracking the top 20 cryptocurrencies by market cap, rose by nearly 9% overall.
The total market cap for cryptocurrencies has fallen to levels similar to those in early November when Trump’s victory caused a sharp rally, overcoming resistance and driving prices higher.
Equity markets also staged a late rebound on Monday after rumors of a possible tariff relief caused the S&P 500 to jump more than 7%. However, most of those gains were erased after the White House labeled the speculation “fake news.”
Meanwhile, crypto futures saw over $1.2 billion in liquidations on Monday, with major cryptocurrencies dropping by more than 20% at one point. This set the stage for a bounce as traders closed short positions and reversed the oversold market conditions, as reported by CoinDesk.
Many traders are now eyeing Bitcoin for indications of market strength, but remain cautious due to the ongoing uncertainty surrounding trade policies and tariffs.
“We’re hopeful that Bitcoin will attract safe-haven buyers if it shows strength relative to traditional assets during a short-term recovery period,” said Jupiter Zheng, partner at HashKey Capital, in a message to CoinDesk via Telegram. “Bitcoin has experienced some losses but remains relatively more stable than other global markets.”
Alex Kuptsikevich, chief market analyst at FxPro, noted that while the market is showing signs of a rebound, the catalysts for a full reversal may not yet be in place.
“Crypto sentiment has plunged into the extreme fear zone at 23, far higher than what we’re seeing in traditional equity markets,” Kuptsikevich said in an email. “This suggests that the sell-off in the crypto market is more organized and could present more risks for investors.”
