Global crypto market cap may soon drop below $500 billion
The crypto space has been facing shock waves since the beginning of the year 2022. Several external factors fueled the crypto market crash including some events within the crypto space. This caused the global market capitalization to fall below $1 trillion, which had swelled to close to $3 trillion just before the annual close of 2021.
Now that the market cap is already down by more than 50%, yet another similar drop is likely in the near future.
According to the founder of Soundwise, a digital audio platform, the global crypto market cap is half of its bottom. The founder referred to the current state of the crypto space as the 2000-2002 dotcom bubble. Then, investors bet heavily on emerging Internet-based companies without considering investment parameters. The bubble soon burst, causing the stock market to drop by more than 80%.
Therefore, the founder believes that the current situation is very similar to the dotcom bubble and therefore the market capitalization may soon drop further down 50% to reach levels below $500 billion.
This Could Have an Effect on the Bitcoin (BTC) Price
The price of bitcoin has fallen drastically in recent days, recording a drop of over 40% in the month of June itself. Star Crypto is down almost 70% from its highs, while another 30% drop is expected in the coming months. Moreover, according to a popular analyst, BTC price could find a bottom somewhere near $14,000 in November.
Analysts Predict BTC Bottoms Based on Fed Funds Rates. He believes that the decisions of the Fed have always affected the crypto space. Currently, BTC price is trading just above the crucial $20,000 support level. If these levels are broken, the rally could be unstoppable until the lower target is reached.
Collectively, the bearish cloud is expected to hover over the crypto space by the end of 2022. Therefore, there could be a huge impact on the prices of Bitcoin (BTC) and the popular altcoin, pulling the global crypto market cap below $500 billion. soon.