Over the last 24 hours, the crypto market has seen a drop of $3 billion from $212 billion to $209 billion, as major cryptocurrencies including Stellar (XLM) and Cardano (ADA) have fallen by 3 to 6 percent.
Peculiarly, Stellar and Cardano are amongst three cryptocurrencies alongside Zcash that are expected to be integrated into Coinbase, the world’s fourth-largest fiat-to-crypto exchange behind Bitfinex, Bithumb, and Upbit.
Why are Stellar and Cardano Falling?
Prior to their listing, Basic Attention Token (BAT) and 0x (ZRX) recorded gains in the range of 100 to 120 percent, increasing by at least two-fold.
Subsequent to their listing, both BAT and ZRX recorded large losses. BAT in specific saw a drop of more than 36 percent from $0.36 to 0.24. While Coinbase listing provides a confirmation that a token is not considered a security under existing regulations, in terms of short-term price trend, it seems to have a negative effect after the fact.
Stellar, Cardano and Zcash already experienced major rallies following the Coinbase listing interest announcement in May, and investors likely see a drop in value to come next in the weeks to come, especially if Coinbase pursues its plans to list the three assets.
On November 12, CCN.com reported that Stellar increased by more than 27 percent since the integration of BAT on November 2.
“Since November 2, the day BAT was officially integrated into Coinbase Pro and Coinbase.com, XLM, the native cryptocurrency of the Stellar blockchain network, has increased from $0.22 to $0.28, by more than 27 percent.”
However, since then, the price of Stellar has dropped by nearly 10 percent from $0.28 to $0.253597, and it is continuing to drop fueled by the lack of momentum of Bitcoin.
Where is Bitcoin Heading?
As a technical analyst and cryptocurrency trader The Crypto Dog explained, various technical indicators demonstrate a lack of momentum for both Bitcoin and the rest of the cryptocurrency market.
Due to the stability of Bitcoin over the last three months since August 9, it can be argued that the bottom is in, but the unpredictability of the cryptocurrency exchange market could send the market to a downward trend.
“Not trying to FUD or terrify anybody, but in general the charts don’t look great for crypto right now. Hopefully we’re A-okay and the bottom is in, but if you’re a holder make sure you are comfortable holding through further drawdown and a much longer bear market (years),” the analyst said, adding, “there is no volume or price action to support a bottom being established on BTC. It could be the bottom, it could be over, but to declare it with certainty is foolish.”
The volume of Bitcoin is still up from $3 billion to $4.4 billion from late October, but the volume of other major cryptocurrencies remain relatively low. In general, on a monthly basis, the daily trading volume of the crypto market is up around 30 percent, from $10 billion to $13 billion.
Last modified: March 4, 2021 3:10 PM