Major coins flashed green Tuesday evening as the global cryptocurrency market capitalization increased 3.13% to $2.2 trillion.
What Happened: Bitcoin (CRYPTO: BTC) was up 3.14% at $48,495.41 over 24 hours. The apex coin has fallen 4.33% over a seven-day trailing period.
Vitalik Buterin co-created cryptocurrency Ethereum (CRYPTO: ETH) traded 1.41% higher at $3,886.82 over 24 hours. It has lost 10.44% of its value in the past seven days.
Dogecoin (CRYPTO: DOGE) shot up 16.56% higher at $0.185 over 24 hours. For the week, the meme coin is up 4.41%. DOGE was the top 24-hour gainer at press time, as per CoinMarketCap data.
Self-described DOGE-killer Shiba Inu rose 2.01% to $0.00003393 over 24 hours. The token has declined 7.02% over a seven-day period.
PancakeSwap, Terra, Elrond, and Avalanche were coins that saw significant appreciation over 24 hours, as per CoinMarketCap.
PancakeSwap shot up 15.56% to $12.64, Terra gained 10.98% to $59.99, Elrond rose 11% to $256.74, and Avalanche was up 9.87% to $88.94 in the period.
See Also: How To Buy Bitcoin (BTC)
Why It Matters: All eyes are on Wednesday where Federal Reserve Chair Jerome Powell will hold a press conference after the Federal Open Market Committee meeting concludes.
— Federal Reserve (@federalreserve) December 14, 2021
The U.S. central bank is expected to increase the pace of tapering to $30 billion per month from $15 billion in the backdrop of rising inflation.
As cryptocurrencies stabilize, the amount of fear in the market appears to be tapering off as well. While Alternative’s “Crypto Fear & Greed Index” signaled “Extreme Fear” 24 hours prior, as of press time, it came down to “Fear.”
Bitcoin is looking for support around the $47,000 “key level,” wrote Craig Erlam, a senior analyst with OANDA.
“A dovish Fed could excite the crypto crowd but that may be a lot to ask given the levels of inflation we’re seeing,” Erlam said in an emailed note.
Erlam’s peer at OANDA, Edward Moya, noted separately that investors are nervous that the “Fed may turn full hawk at tomorrow’s policy meeting.”
Moya noted the price action in Dogecoin brought on by a tweet by Tesla Inc (NASDAQ:TSLA) CEO Elon Musk. The entrepreneur said Tuesday that Tesla “will make some merch buyable with Doge & see how it goes.”
“Many crypto traders are focusing on which altcoins to bet big on and Musk’s tweet served as a reminder that you can’t forget about Doge as some businesses remain committed to using it,” Moya wrote in a note seen by Benzinga.
A marked difference between the BTC correction that took place in May-July this year and the current October-December correction is that while exchanges saw an “enormous influx” of 168,000 BTC in the former period, the current downturn has seen an outflow of 49,000 BTC, as per Glassnode, an on-chain analytics firm.
Bitcoin Balance (All Exchanges) — Courtesy Glassnode
“Overall, whilst significant losses are most certainly being realized on-chain, they are being met with a significant, and arguably overwhelming demand,” Glassnode wrote in a blog.
Meanwhile, Ark Invest CEO Cathie Wood said Ethereum’s position as a “venue for DeFi and NFTs” makes it undervalued compared to Bitcoin.
“The fact that it [Ethereum] is the venue, or the protocol, for [Decentralized Finance] and for [Non Fungible Tokens] suggests to us that it is even more undervalued than Bitcoin is, just because there are new worlds growing up on top of it,” Wood said in an interview with CNBC.