HomeCryptoCrypto market capitalization has surpassed the trillion-dollar mark

Crypto market capitalization has surpassed the trillion-dollar mark

Total crypto market capitalization has surpassed the trillion-dollar mark, returning to the levels of 8 November, the day before the collapse of the FTX cryptocurrency exchange.

Crypto market capitalization recovers and surpasses $1 trillion

It had been since 8 November 2022 that the total capitalization of the crypto market had not seen this figure: $1 trillion. And yet, finally, the market cap has returned to pre-collapse levels of the FTX crypto-exchange.

Obviously leading the bull run has been the queen of cryptocurrencies, Bitcoin (BTC), which as of last Saturday was back above the $20,000 level, touching $21,401 on yesterday’s trading day. In practice, BTC’s price pump has risen more than 20% in the past seven days, and about 30% since the beginning of the year.

Ethereum (ETH) hasn’t stood idly by either, but rather, during this past Saturday it rose from $1,454 to $1,556, touching $1,600 yesterday. In total, ETH has seen a price pump of about 23% in the past month.

Overall, the total market capitalization of the crypto market is picking up after the collapse it experienced starting on 9 November, when the collapse of FTX was officially declared, and it had fallen to its all-time low of $796 billion. In fact, since that time, the crypto market cap has increased by more than 20%.

Admittedly, in total, when comparing today’s figures with last year’s, the total crypto market capitalization is still 50% lower.

The surge in crypto market capitalization: the possible factors

This past week’s surge in crypto market capitalization certainly depends on the rising prices of cryptocurrencies, but also on the change in sentiment on the part of investors and the decline in inflation. 

And in fact, an important data point is brought back to us by Bitcoin’s Fear and Greed index, for example, which since last Saturday has moved out of the red zone, defined as “fear,” and back into the neutral zone, surpassing the score of 50.

In contrast, the Fear and Greed index for Ethereum has been more positive, placing itself in the neutral zone for some time and since last Saturday reaching the green zone of enthusiasm, with a current score of 69.

The decline in inflation and the US dollar

Not only that, the decline in US inflation is also the main driver of market gains in general.

The aggressive policy of raising interest rates undertaken by the Federal Reserve, with the aim of reducing the amount of money in circulation, is perhaps now beginning to show its first results.

The Consumer Price Index (CPI) showed that inflation fell 0.1% last month, with the overall rate now standing at 6.5%. Not only that, another indicator of market health is the decline of the USD. 

Crypto prices and the dollar have been moving in opposite directions over the past year, and as inflation falls, it seems investors are abandoning the fiat currency.

Stefania Stimolo
Stefania Stimolo
Graduated in Marketing and Communication, Stefania is an explorer of innovative opportunities. She started out as a Sales Assistant for e-commerce, and in 2016 she began to develop a passion for the digital world, initially in the Network Marketing sector, where she discovered and became passionate about the ideals behind Bitcoin and Blockchain technology, which lead her to work as a copywriter and translator for ICO projects and blogs, and organize introductory courses.