Key data points suggest the crypto market’s short-term correction is over

Altcoins

The performance of cryptocurrencies in the past 7 days might have seemed slightly unexciting, especially since the total market capitalization increased by “only” 1.8% to reach $2.7 trillion. However, even with the muted price action, some altcoins managed a decent rally. Bitcoin (BTC), on the other hand, was down 6% until Nov. 28, but it still managed to close the week up 1.5% after a $3,200 rally on Sunday night. 

Winners and losers from the top 80 coins. Source: Nomics

Metaverse tokens are still pushing to new highs

The metaverse sector continued to outperform with Gala (GALA), The Sandbox (SAND), and Decentraland (MANA) among the top 5 gainers. While few play-to-earn and Metaverse “environments” are available for true interaction, major news and partnerships are still boosting these metaverse-related token valuations.

As reported by Cointelegraph on Nov. 24, Metaverse Group purchased virtual land in Decentraland for about $2.5 million. On Nov. 25, a digital land plot in the Axie Infinity game was sold for 550 ETH on Nov. 25, or roughly $2.5 million.

Moreover, a collaboration between Sony Pictures and AMC Entertainment announced on Nov. 28 will offer up to 86,000 Spider-Man NFTs to celebrate the opening day of its new feature movie.

Zash (ZEC), a privacy-focused cryptocurrency launched in Oct. 2016, spiked 20% in 24 hours on Nov. 20 as developers announced plans to abandon traditional mining and migrate to a Proof of Stake network.

Amp (AMP), the native collateral token of the Flexa payment network, also rallied on Nov. 24 after listing on Binance. Meanwhile, Terra (LUNA) benefited from a 5.4 million token burn in four days, according to Caviar startup founder and crypto investor Jason Wang.

Ethereum-killers limp along

Among the worst performers were four smart contract platforms aiming to break Ethereum’s dominance: Cardano (ADA), Near Protocol (NEAR), Polkadot (DOT) and Harmony (ONE).

On Nov. 24, Ethereum co-founder Vitalik Buterinand issued a proposal for the transaction calldata limit in a block to “cut costs and to incentivize an ecosystem-wide transition to a rollup-centric Ethereum”.

Aave Protocol (AAVE), the collateralized lending and yield platform, continues to trade in a downtrend after its TVL decreased by 30% in 3 months.

Dash (DASH) saw its number of addresses with at least 1,000 tokens decrease to 5,210, the lowest level since July 2018.

Tether and derivatives markets are looking flat

The OKEx Tether (USDT) premium measures the difference between China-based peer-to-peer (P2P) trades and the official U.S. dollar currency, has improved slightly.

OKEx USDT peer-to-peer premium vs. USD. Source: OKEx

The indicator’s 99% reading is neutral-to-bearish, signaling weak demand from cryptocurrency traders to convert cash into stablecoins, but it’s still a vast improvement from the 5% discount in mid-October.

Furthermore, the cryptocurrency total futures open interest held steady near $50 billion, which is merely 10% below the all-time high. It is worth noting that an open interest decrease is not necessarily bearish, but maintaining a certain level is interesting because more liquidity providers and market makers enter the market.

Total crypto aggregated futures open interest. Source: Coinglass.com

The futures’ open interest provides a healthy reading considering the nearly $2.0 billion worth of liquidations that happened during the week. The 10% total crypto market capitalization dropped to $2.37 trillion on Nov. 25 and was responsible for 44% of the forced futures contracts terminations.

The above data might not sound exciting, but considering that Bitcoin (BTC) and Ether (ETH) are both strong on Nov. 29, the rebound from the previous day might indicate that the 2-week correction period could be over.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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