Bulls are back, but regulatory fears hamper the DeFi and altcoin recovery


On May 19, the total cryptocurrency market cap fell by 19% and has since failed to recover to the $1.8 trillion mark. It’s been more than 40 days, and investors are starting to wonder what might happen to the altcoin if the current bear market takes longer than expected to recover.

Before looking into this, analysts first need to understand whether certain sectors have held up better than most, and most importantly, they must distinguish which cryptocurrencies have managed to stay afloat over the past 30 days.

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Total cryptocurrency market cap (in billions). Source: TradingView

Although the total market capitalization of cryptocurrencies decreased by 5% in 30 days, approximately 44 of the top 100 coins fell by 19% or more during this period. This data is a strong indication that investors have cut losses for some cryptocurrencies.

The worst performers out of the top 100 in the last 30 days. Source: CoinMarketCap

The worst performing list shows an impressive number of tokens from smart contract platforms. In fact, five of the top six fall into this category. One of the main aspects may be the sharp drop in the Ethereum network gas fees, which causes a drop in demand for alternative solutions.

Another pattern that has emerged is the synthetic asset class, represented by Synthetix Network (SNX), UMA and Perpetual Protocol’s PERP token. Investors may sense potential issues, as the World Economic Forum recently published a Policy Toolkit for Regulating Decentralized Finance. Furthermore, Dan Berkowitz, commissioner of the US Commodity Futures Trading Commission, Mention that DeFi is potentially illegal.

On the other hand, the list of outliers over the past month is significantly shorter. Only 12 of the top 100 managed to give a positive performance.

Top 100 performers in the last 30 days. Source: CoinMarketCap

This time around, it’s hard to find a common trend among the top performers. Quant’s AMP token for Flexa and QNT were both recently listed on Coinbase Pro. at the same time, Theta is expected to release Mainnet 3.0 On June 30th. Finally, Solana Labs, who is behind the famous SOL icon, He raised $314 million by selling a private token.

Therefore, some conclusions can be drawn from the analysis. The fact that only 12 coins could gain in the past 30 days shows that diversification into altcoins may not pay off. Meanwhile, bets on “Ethereum killers” offer higher losses, as the bear market itself has managed to curb excess gas fees.

Finally, the regulatory uncertainty around DeFi will not be realistically resolved over the next 30 days. There is reason to believe that Ethereum network upgrade for July and the Repercussions of El Salvador’s decision قرار to make bitcoin (BTC(The official coin is likely to focus investors’ attention and funds on BTC and Ether)ETH).

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