The cryptocurrency market has experienced a notable rebound, with Ethereum (ETH) rallying back to around $1,550 on Tuesday, marking about a 10% gain within the past 24 hours.
This surge follows a dramatic decline to a two-year low of $1,410 earlier in the week, during which ETH suffered a staggering 27% crash in just 48 hours.
The rebound offers a much-needed reprieve for investors who bore the brunt of significant liquidations and losses during the turbulent period.
Ethereum’s latest price recovery comes amid intensified activity in derivatives markets, which were shaken by the rapid price drop.
Liquidation in the past two days
According to data from Coinglass, approximately $370 million worth of leveraged ETH futures were liquidated over just two days, a testament to the scale of the downturn.
Santiment statistics further revealed that the sell-off was driven by short-term holders, who collectively endured losses amounting to $500 million on Monday alone.
The volatility in Ethereum’s performance has raised concerns about the resilience of the cryptocurrency, but analysts are cautiously optimistic about the possibility of further stabilization as market conditions improve.
Bitcoin rallies back from $75,000
Bitcoin briefly dipped below $75,000, only to rally back to approximately $80,000 late Monday, igniting a wave of recovery across major cryptocurrencies such as XRP (XRP-USD), Dogecoin (DOGE-USD), BNB (BNB-USD), and Cardano’s ADA (ADA-USD).
These tokens saw gains of up to 10%, helping the total crypto market capitalization return to levels not witnessed since early November.
The recovery was largely technical, as Monday’s market shakeout resulted in the liquidation of over $1.3 billion in crypto futures—predominantly affecting long positions. This purge of overleveraged traders cleared the way for a more stable rebound.
What you should know
- Despite its recovery, Bitcoin’s claim to be a “digital gold” continues to face skepticism. Unlike traditional safe-haven assets like gold, which typically appreciate during periods of market turbulence, Bitcoin has shown a tendency to trade in tandem with high-risk technology stocks.
- During last week’s equity sell-off, Bitcoin dropped alongside the S&P 500, further challenging its reliability as a refuge during financial chaos.
- These concerns are seen by findings from a peer-reviewed study published in ScienceDirect, which revealed that Bitcoin failed to act as a safe haven during the 2020 COVID crash. Instead, it mirrored equity movements, highlighting its vulnerability to broader market trends.
- Positively, Ethereum’s network architecture keeps proving to be robust. On April 6, the Ethereum network’s overall value locked (TVL) peaked at 30.2 million ETH, a 22% rise over last month.
Over the same period, this rise exceeded rivals such as Solana (12% increase) and BNB Chain (16% increase).
