Crypto market capitalization falls below $1 trillion

What’s new? The capitalization of the cryptocurrency market has once again fallen below the $1 trillion mark. As of July 27, it stands at $981,6 billion, according to CoinMarketCap. This is likely due to expectations of a tightening of monetary policy by the US Federal Reserve System (Fed). The regulator may raise its key rate by 75 basis points to 2,25-2,5% at the next meeting. Analysts at Blofin noted that “the next shock brought by the arrival of the Fed’s interest rate hike” is just around the corner.

1/9. The U.S stock market fell to some extent today, whereas the crypto market stopped its losses. However, the next shock brought by the arrival of the Fed's interest rate hike in July is upcoming. pic.twitter.com/4AGIMaRspC— Blofin (@Blofin_Official) July 27, 2022

What else did the analysts add? Blofin notes that the US stock market has declined slightly while the fall in the crypto market has paused. The analysts also pointed out that the Crypto Market Fear & Greed Index (F&G) rose slightly to 28/100, but is still in a range that reflects the predominance of fear among investors. According to them, the investors’ bearish sentiment is “relatively stable.”

5/9. The Crypto Market Fear & Greed Index rose back a bit today. The index continued to stay in the 'fear' territory. It seems that the bearish sentiments in the crypto market are relatively stable. @ResearchVariant pic.twitter.com/9GGir8SzCB— Blofin (@Blofin_Official) July 27, 2022

Crypto Fear & Greed Index is an indicator that measures the general mood of investors in the market. It is measured on a numerical scale from 0 (“extreme fear”) to 100 (“extreme greed.”) Various data such as volatility, bitcoin capitalization, market volume, as well as social media sentiment are analyzed to determine the index.

Herewith, according to aggregator CoinGecko, the capitalization of the crypto market is still above the 1 trillion mark, and in the last 24 hours has shown growth of 1,4%.

During the second quarter of 2022, the capitalization of the DeFi market fell by 74%, from $142 million to $36 million. According to the CoinGecko report, one of the reasons was the collapse of the Terra ecosystem. Another factor was the rise in hacks of DeFi protocols. Hacking attacks negatively affected the value of tokens and undermined investor confidence in this asset class, experts say.