Weekly Cryptocurrency Commentary
Last week, we had warned of a potential correction in crypto prices due to weaker crypto trading volume and uncertainties in the equity markets. Note that our studies indicate a positive low-moderate correlation between Bitcoin and trading volume/the S&P 500. The global MCAP of cryptos were down 9.9% WoW to US$2.4T. Global crypto trading volume was up 24% WoW, but considering the S&P 500 could face downward pressure due to uncertainties related to Omicron, we are expecting crypto prices to remain flat this week.
Performance of Select Cryptos
Prices of mainstream/popular cryptos were down 15% on average last week.
Companies operating in the crypto space are trading at an average EV/R of 12.9x (previously 13.0x).
Key sector development listed below (positive):
- El Salvador’s President announced over the weekend that his country has “bought the dip.” Sources indicate that the country’s entry in Bitcoin was at approximately US$48k.