Proactive Investors - Bitcoin bounced higher over the weekend after dropping to a seven-week low of US$25,800 on Friday evening.
At the time of writing, bitcoin (BTC) was trading at US$27,440 after heading 1.75% higher in this morning’s trades, marking a 6.3% recovery over three days.
Bulls will be relieved to see the world’s largest cryptocurrency not break below 25k, which could have proved a galvanising moment for bears attempting to apply downward pressure.
Open interest appears to be favouring a bullish sentiment right now, with long interest of US$12bn edging out short interest of US$11.35bn.
Bitcoin (BTC) recovered lost ground over the weekend – Source: currency.com
However, as has been an evolving narrative in recent weeks and months, overall liquidity on the bitcoin markets is heavily depleted, making for a volatile pricing environment as fewer trades exert greater influence on spot prices.
Transaction fees, which have also been a source of anxiety amid unprecedented network congestion, have come down considerably - from over US$30 to below US$4 in the space of a week.
Bitcoin’s mempool size – a decent measure of network congestion that measures the amount of unconfirmed transactions – has tapered off in recent days and while still abnormally high, is showing signs of relief.
Put together, these factors point to an improvement in bitcoin’s overall efficiency following a worrying period, but lessened interest among investors into bitcoin as an asset class.
As for Ethereum (ETH), the world’s second-largest cryptocurrency by market capitalisation, recovered 5% over the weekend, bringing the ETH/USDT pair back to US$1,830 at the time of writing.
Week-on-week, ETH/USDT remains 1.6% lower, while BTC/USDT remains 2.4% lower.
Litecoin pulls ahead
Popular payment crypto Litecoin is on a tear in the buildup to its halving event on August 2.
Just like bitcoin, LTC’s rate of distribution to miners halves every four years to regulate circulation and maintain strong pricing activity.
Bitcoin, litecoin and other proof-of-work cryptocurrencies that halve every four years tend to enjoy a strong rally preceding these halving events; this is playing out on the LTC/USDT trading pair, which is currently over 7.6% high week-on-week, making it easily the strongest performer among the blue-chip altcoins.
Other strong top-20 altcoins include Tron (TRX) adding 2.2% in the past seven days and Cardano (ADA), up 1.7%.
Global cryptocurrency market capitalisation added 1.7% to US$1.14tn overnight, while total value locked in the decentralised finance (DeFi) space added 1.3% to US$47bn.
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