Cryptocurrency markets have been hit this week, with major coins like Bitcoin experiencing price drops and memecoins suffering significant losses.
This slowdown comes amid concerns about a possible tightening by the US Federal Reserve and news of outflows from Bitcoin ETFs, with the uncertainty highlighted by the end of a 20-day streak of inflows into Bitcoin ETFs. BTC in spot and significant drops in memecoins (15%) and Solana. (10%) during the past week.
Memecoin mania meets reality
Memecoins, once the hot corner of the cryptocurrency market, are facing a harsh reality. Dogecoin (DOGE) and Shiba Inu (SHIB), the two most recognizable memecoins, have seen double-digit percentage drops in recent days. SHIB, in particular, has plummeted 18.4% over the past week, while OG doggie DOGE is down 13%, WIF is down -20.09%, BONK is down -21.17%, and PEPE is down -11.97. % during the same period, placing them among the worst performing cryptocurrencies this week.
the change in memecoin Luck has also caused a 7% drop in Solana, a blockchain that has been the focus of a large segment of this space, over the last 24 hours. The token currently stands at $137.44.
This decline could indicate a shift in investor sentiment away from memecoins and toward more established cryptocurrencies with perceived utility. However, it is important to note that memecoins are known for their unpredictable behavior, so a quick reversal is not completely out of the question.
Bitcoin ETF Exits Raise Questions
Adding to the market's nerves is the news of capital outflows from Bitcoin ETF. These exchange-traded funds, which allow investors to gain exposure to Bitcoin without directly holding the cryptocurrency, have been hailed as an important step toward widespread adoption.
However, recent reports indicate a net outflow of over $620 million from Bitcoin ETFs last week, suggesting that some investors could pull out due to the current market climate.
The pain continued this week: On Monday, the 11 bitcoin ETFs cumulatively recorded net outflows of $145.83 million, led by Fidelity's FBTC, which recorded outflows of $92 million. The block reported.
The capital outflow could be related to the hawkish stance of the US Federal Reserve, which has signaled possible interest rate increases to combat inflation. Rising interest rates may make riskier assets, such as cryptocurrencies, less attractive to investors.
At the time of this publication, Bitcoin stood at $65,701, or -0.74% in 24 hours and -2.69% in 7 days, according to data from CoinMarketCap.
"Bitcoin price has been steadily declining since the recent hawkish comments from the Federal Reserve. This is the fourth time that BTC has failed to surpass the $71,500 mark and reclaim its all-time high. The abrupt reversal after the $71,500 price surge 4,000 CPI-induced rise has instilled doubts in the minds of investors," he said brn analyst Valentรญn Fournier.
"While we believe in a Bitcoin rebound, a new catalyst will be needed for it to break out of the $65,000 to $71,000 range. Consistent evidence of declining inflation in the US or global interest rate cuts could provide the liquidity necessary to drive the market upwards," the analyst added.
A bright, lonely spark: TON bucks the trend with explosive growth
While the overall market is experiencing a slowdown, Telegram Open Network's native token, TON, has defied the downward trend with a surge in price in recent days. This unexpected rally comes on the heels of major developments within the TON ecosystem.
Heaps Impressive performance can be attributed to the rising total value locked (TVL) on the TON blockchain and its rapidly growing DeFi ecosystem. According to CoinTrust, TON's TVL has more than doubled in the last three weeks, surpassing $600 million. This substantial growth reflects investor confidence in the network's potential and the development of robust DeFi applications on TON.
Secondly, the integration with Telegram, a messaging platform with more than 500 million monthly active users, is another key factor. This integration has the potential to introduce a massive user base to TON, driving greater adoption and demand for the token. Finally, the recent rise of memecoins within the TON ecosystem, such as Resistance Dog, The Resistance Cat, and Ton Inu, has attracted additional attention.
