The cryptocurrency market has more than doubled in recent months, led by Bitcoin’s surge.
The total crypto market capitalization has reclaimed the $2 trillion level for the first time since April 2022, as positive market sentiment and consistent inflows into spot Bitcoin exchange-traded funds (ETFs) pushed BTC’s price higher.
Total crypto market capitalization. Source: TradingView
BTC $57,175 price brought the world’s largest cryptocurrency by market capitalization to a multi-year high of $57,513, while Ether
ETH
$3,249 enjoyed a 7% pump to rest at $3,270 at the time of writing.
Other top altcoins were also flashing green, with Solana
SOL $108 gaining 9% over the last 24 hours to hit $110. XRP
XRP $0.59, Cardano
ADA $0.63 and Avalanche
AVAX
$39.11 were up 5.3%, 7%, and 6.5%, respectively, over the same period. The tenth-placed Dogecoin
DOGE $0.10 enjoyed double-digit gains, climbing 15% to $0.09779.
Their combined efforts have culminated in a 7.7% rally to the global crypto market value, lifting it to a 22-month high of $2.14 trillion, according to data from CoinMarketCap.
To put it into perspective, the crypto market is now some $33 billion bigger than Amazon and $42 billion larger than Google’s parent Alphabet.
The crypto market has more than doubled within a few months
Crypto enthusiasts on the X social media platform were quick to celebrate the return to the $2 trillion mark, with some, such as The Kobeissi Letter, asking whether “new all-time highs are ahead for Bitcoin.
Commentators at The Kobeissi Letter noted that total crypto market capitalization has “more than doubled from its recent low” of $978 billion reached on Sept. 11, 2023.
Independent technical analyst Crypto Damus spotted the crypto market cap at $2.06 trillion, saying it was approaching a critical resistance level.
He shared the following chart with his over 36,000 followers on X, wondering what new price discoveries would be with just 50% to go until the $3 trillion all-time high is regained.
Total crypto market cap. Source: Crypto Damus/X
Popular crypto analyst Voice of Crypto posted a chart showing all the major cryptocurrencies trading in the green, terming the move above $2 trillion in total market cap as “extraordinary.”
Positive market sentiments back crypto prices
The rallying market is basking in bullish market sentiment, given that the fear and greed index is showing “extreme greed” at 79 on Feb. 22, according to data from Alternative.
The index was last in the “extreme greed” zone in November 2021, when the price of the pioneer cryptocurrency reached an all-time high of $69,000.
Crypto fear and greed index. Source: Alternative.me
During strong rallies, the index will likely remain in the “extreme greed” zone for an extended period. However, Alternative warns, “When investors are getting too greedy, that means the market is due for a correction.”
Market analyst Bitcoin Suisse posted the chart below showing the market sentiment also in the “extreme greed” territory at 79, saying,
“Crypto and equities are continuing to trade at multi-year or all-time highs, and both are currently in extreme greed levels when it comes to market sentiment.”
Crypto market rally driven by inflows into crypto products
The rally in the wider crypto market is led by Bitcoin, which has seen strong demand on the back of spot ETFs. At the same time, outflows from the Grayscale Bitcoin ETF (GBTC) hit the lowest volume ever of $22 million.
Data from Farside Investor shows slowing outflows from GBTC for the third consecutive day on Feb. 26. The converted Bitcoin ETF ended the trading week on Feb. 23 with a net outflow of $44.2 million, which further halved on Feb. 26.
According to CoinShares’ reporting, BTC investment products recorded 99% of all crypto inflows last week. Bitcoin welcomed $569.5 million inflows, bringing the total global assets under management to $67.5 billion
Capital flows for crypto investment products. Source: CoinShares
Additionally, Bitcoin ETFs continue to see inflows totaling $5.5 billion since their market debut on Jan. 11, according to data from Yahoo Finance. Overall, the crypto products have taken in a net of $5.8 billion since they began trading, according to CoinShares.
The Bitcoin ETFs are also rallying alongside BTC’s price with BlackRock’s Bitcoin ETF IBIT at position “5 of the 3,400 ETFs & well ahead of @Vanguard_Group ‘s top ETF, VOO” according to ETF analyst HODL15Capital.
