Up until September 4, 2018, most traders and fans were of the belief that the crypto market cap was beginning to pull itself out of the bear market. However, the current market movements prove that this is not the case. From September 5 onwards, the market cap has been dipping harshly, bringing its value down to $191 billion. This is the lowest that we have seen the crypto market cap within 2018.
Have we hit the bottom of the bear market?
On August 14, the crypto market cap fell to $192 billion and then steadily rose from it. At the time, people assumed that this was the bottom of the bear market. People’s hopes were partially validated by the fact that prices shot upwards from August 27 to August 29. At that point, it made perfect sense to consider the bear market as over. However, the revelations of the past few days prove to us that our assumptions were premature.
In an attempt to understand this bear market, let’s take a look at bitcoin. Since the bear market began, which arguably started on January 8, bitcoin has come disturbingly close to $5,000 a total of seven times. Every time this happens, bitcoin bounces back just a little, but each time it bounces back, its rises are less and less impressive. The history of the chart suggests that we are not too far from bitcoin actually reaching $5,000 and possibly even lower. As bitcoin is still the market leader, its actions will affect the crypto market cap, meaning it would get dragged down with it. The unfortunate nature of this situation is that without something positive to pull us out of the bear market, this may even be inevitable.
What could stop the crypto market cap from dipping further?
Some bear markets (and bear runs) stop on their own, but for the most part, it takes some sort of catalyst to get rid of them. This catalyst would have to be something which could instill hope into the minds of most traders, especially high-level traders. The perfect example of a catalyst would be if the bitcoin ETF got approved by the SEC. So far, ETF proposals have been rejected four times, but there is still hope as a new proposal is to be reviewed by the SEC on or before September 30. If the proposal was accepted, it could be enough to pull bitcoin and the crypto market cap out of its downward spin.
Kai is a cryptocurrency copywriter and professional trader. He can often be found investigating various cryptocurrencies, whitepapers, and blockchain technologies. Kai has been a professional writer for 5+ years, and has invested in 50+ different coins and tokens. He also currently studies Law and Philosophy at university.