The ninth week of the winter of criptocurrencies is approaching and bitcoins can't shake the chills.
Market indicators are red or amber for the biggest criptome, which has lost a third of its value in just two months, from technicals to turnover.
The limited history ofBitcoin isn't a guide on the topic of winters, but we're defining it as prolonged bearishness for a month or more.
There have been five since 2017 and three since 2021. Last year, there were two crashes that lasted 14 and 10 weeks and caused bitcoin to lose 45% to 47%. If they were typical, the latest drop of 36% in eight weeks has a road left to run.
Joseph Edwards, head of financial strategy at Solrise Finance said that nobody really sees the potential for digital currency to give 10 times return.
The macro background is not supportive for an asset class that is now seen as volatile, risky and vulnerable in the face of inflation. As worries over rising global rates and geopolitics bring U.S. stocks close to confirming a bear market, cryptocurrencies aren't on anyone's shopping list.
There are signs that the king is plotting its comeback, even in the icy wilderness.
After the collapse of TerraUSD in early May, it draws strength from the rest of the market, for example, its relative stature, which provides some comfort for investors fleeing altcoins such as stablecoins that are considered ultra-risky.
The market cap of the digital currency has gone up to a seven-month high of 44%, even though its price has decreased.
According to Marcus Sotiriou, analyst at UK-based asset broker GlobalBlock, institutional investors are particularly fleeing to safety because they believe thatbitcoin has the most institutional adoption.
CFTC data shows that traders are positioning for an increase in the price of the cryptocurrencies, despite the fact that they saw their largest net long position last week.
Since its Nov. 10 peak of $69,000, the value of the digital currency has lost half of its value. It is flirting with $30,000 this week after touching a 17 month low of $25,401 on May 12. It remains the largest digital asset by market cap, but the market value of all cryptocurrencies now stands at $1.3 trillion, less than half of the $3 trillion peak in November.
Coinglass's Fear Greed Index of Market Sentiment - where 0 indicates extreme fear and 100 extreme greed - is hovering at 13.
The 2 token by market value, has hovered near the $2,000 mark, and is down about 60% from a peak of $4,868 on November 10.
Bilal Hafeez, CEO at research firm Macro Hive, pointed out $2,300 and $2,500 as key levels and warned that failure to hold above either of those marks in the near term would be a bearish signal.
As of Monday, the total spot market volume for all cryptocurrencies had fallen to $18.4bn - less than half of the $48.2bn seen on May 14, which was the highest volume for 2022, according to news and research site The Block.
The Glassnode technology firm said on May 9 that 40% of investors are underwater on their holdings due to the fact that they are at $33,600.
Many people are left wondering what they should do with their coins if they keep holding on for dear life or book losses? According to Lindsey Bell, chief markets and money strategist at Ally Invest.
It's a good reminder that cryptocurrencies shouldn't be more than 1 % of your portfolio.