February Ushers In Crypto Rally After A Turbulent January

Cryptos welcomed February on a strong note, with overall market gaining around 5 percent in the past 24 hours. The green splash is in sharp contrast to the turbulence recorded in much of January, which witnessed overall market capitalization slide 20 percent to $1.77 trillion, from $2.20 trillion at the end of December.

The best performer in the February rally is Solana (SOL) which has surged more than 17 percent in the past 24 hours to trade at $108.35. SOL had plunged 41 percent in the month of January from $170.3 to $99.74 in the backdrop of repeated network outages.

Terra (LUNA) and Polkadot (DOT) have both surged close to 10 percent in the past 24-hours. In contrast, LUNA was down 39 percent in January and DOT was down 27 percent during the same period.

The 24-hour gain clocked in 20th ranked Cosmos (ATOM) is 8.27 percent, as compared to the 13.3 percent decline recorded in the entire month of January. ATOM is trading at $29.08 versus $32.47 at end of December. Cosmos (ATOM) was the best performer in the month of January among the top-15 cryptocurrencies (excluding stablecoins) with the least decline of 13.3 percent.

With Tuesday’s 9.1 percent rally, Ethereum has made good a third of the 27 percent decline recorded in January. Ethereum is currently trading at $2,791.71 versus $2,688.28 at end of January and $3,682.63 at end of December. Ethereum has regained market dominance and is currently commanding 18.7 percent of the cryptocurrency market capitalization.

Avalanche (AVAX), SHIBA INU (SHIB) and Polygon (MATIC) which had all shed more than 35 percent inJanuary, witnessed modest rallies between 4 and 6 percent, in the early hours of Tuesday, 1st February.

BNB (BNB) and XRP (XRP) had given up more than 25 percent in the month of January. On Tuesday, XRP surged more than 6 percent whereas BNB rallied 3 percent.

In January, Crypto.com Coin (CRO) had declined 23 percent whereas Cardano (ADA) had dropped a little less than 20 percent. Currently, both have made gains of close to 4 percent in the past 24-hours.

Wrapped Bitcoin (WBTC), Bitcoin (BTC) and Dogecoin (DOGE) had lost around 17 percent in the first month of 2022. All these have gained between 3 percent and 4 percent on Tuesday. Bitcoin is currently trading at $38,920.46, commanding a market dominance of 41.4 percent.

Meanwhile reports emerging from Russia indicate that there is high opposition to Central Bank of Russia’s recent crypto ban proposal. The reports also indicate the possibility that the ban may instead be limited to crypto mining activities, impacting proof or work cryptocurrencies.

India government today proposed a 30 percent taxation on income from digital assets while also announcing its intentions to roll out a Central Bank Digital Currency by 2023.

Thailand scrapping crypto taxation, CBDC rollout plans by Jamaica, the shutting down of Meta’s stablecoin project Diem, were some of the other headlines on Tuesday that may have an impact on the virtual currencies.

Crypto sphere is definitely relieved as more regulators clarify on the scope and specifications of regulatory oversight. While regulators are wary of the impact of cryptocurrencies on financial stability, money laundering, monetary policy etc., there is also a growing cognizance of the need to regulate without stifling innovation. That is definitely good news for digital assets enthusiasts.

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