The crypto dump has damaged the bulk of the digital assets in the space, and the indexes have felt the heat of this drop. When the market went red last week, prices fell across the board, with Bitcoin losing nearly $10,000 in value. The crypto cap indices have suffered losses in the double digits, indicating a negative week for the market.
Although the market mood is improving, cryptocurrencies are still fighting to restore their lost value. November ended with a bullish trend, while December began with a bearish streak.
Only one week into December, the crypto cap indexes are already feeling the heat of shaping up to be a gloomy month for the market. As investors sold off their shares, all indices saw multi-digit drops. For the first week of December, negative returns have been the order of the day across all indices, from small to large-cap.
According to Arcane Research, the Small Cap Index performed admirably in November. On the other hand, the indices are starting to lose all of the gains earned in the preceding month. The Small Cap Index had the best return in November but has done a full 180 in December, with the largest losses in the first week of the month. The Small Cap Index returned 18 percent year to date, indicating once again that it is the most volatile of all crypto indices.
The Large Cap Index performed better than the other indices, although it still lost double digits for the week. Its 13 percent drop was reduced by Ethereum, which has maintained momentum amid falls in the larger market. The ETHBTC is now trading at a three-year high, and Ethereum has increased its market share by 1.46 percent this week.
Both the Mid Cap and Bitcoin Indexes lost money within the same time period. Bitcoin’s performance has stayed consistent with that of the market. However, the index reported a 15% loss for the week, the same proportion as the Mid Cap Index.
The crypto market has experienced some strong liquidations in the recent week. Bitcoin took the worst damage, falling by around 10% amid a liquidation frenzy. Due to poor liquidity and significant selling pressure in the spot market, the weekend price declines resulted in a large number of future positions. After the initial wave of liquidations was completed, it set off a chain reaction that resulted in even more liquidations.
This pushed the price below $42,000, reflecting a $10K reduction in value over the same time span. Since then, the market has begun to rebound, but some of the consequences of the liquidations remain as bitcoin tries to regain its footing over $50,000 once more.