Biggest exchange on network successfully defends itself after enormous withdrawals surge
Following the positive CPI release and inflation below expectations, the digital assets market entered short-term rally mode, with most assets breaking local resistance levels and reaching thresholds that markets have wanted to see for more than a month.
BNB market relief
The panic around Binance was the last thing the cryptocurrency market needed right now: the exchange was practically attacked from all sides after the report on Binance’s 2018 investigation was released.
Luckily, the exchange proved its solvency and resilience by publicly confirming massive reserves and easily dealing with $2 billion worth of withdrawals that practically destroyed FTX only a month ago.
After investors were reassured and stopped the massive withdrawal wave, BNB immediately bounced back to the regular trading range, making numerous attempts to crash the cryptocurrency to a two-week low.
At press time, BNB is trading at $272 and losing approximately 0.07% in the last 24 hours.
Ethereum finally reaches $1,300
The second biggest cryptocurrency on the market successfully breached the 50-day moving average. It has been consolidating around there for two weeks now. A lack of network activity and a depressed burn rate were the two main reasons behind Ether’s inability in the past to reach the resistance and gain a foothold above it.
With the overall recovery of the market, Ethereum’s network activity will most likely step up, which should fuel the asset’s recovery once again and push it back into the deflationary zone it left more than a week ago.
Net issuance on the assets has also changed to surplus. Two main price drivers for Ethereum became obsolete in the post-FTX market. The massive increase in exchange outflows correlated with the leakage of coins from decentralized solutions that provide most of the assets activity on blockchain. Such a tendency created conditions in which Ether simply could not stay on a growth path and simply retreated toward a neutral price range, where it has consolidated until now.
With spiking network activity and the breakthrough, we expect an increased inflow of funds into Ethereum and the return of the burning power to the blockchain.
Dogecoin divergence intact
As we covered in our previous review, Dogecoin has been gradually losing its power on the market and already lost around 70% of what it had gained previously. Today, we are seeing yet another indicator of fading and reversal — the divergence between the price and the volume.
Despite the steady uptrend on Doge, the meme coin has been gradually losing its trading volume after no confirmation of DOGE implementation on Twitter appeared in the crypto trading space. With the lack of other growth factors, Dogecoin lost a major portion of its value and returned to the early November level, despite the massive 120% rally we saw by the end of the month.
Unfortunately, no additional growth factors lined up around Dogecoin, leaving traders with nothing but hope for a general market recovery that would drag DOGE upward, even without the help of Elon Musk or any other influencer in the space.