Recovery or dead cat bounce? Cryptos regain a bit of lost ground
After one of the most volatile weeks in recent history, cryptocurrencies were finally on the rise Friday morning—but whether this is a short-term breath-catch or the bottom of the slide won’t be clear for a little while.
Bitcoin had gained 10.5% as of 10:00 a.m. ET, while Ethereum was up nearly 13%.
XRP was up 23%, while Solana and Cardano both gained nearly 30%. And memecoin darlings Dogecoin and Shiba Inu were up 25% and 38%, respectively.
The rebound comes as cryptocurrencies have seen more than $1 trillion in value vanish in the past six months, testing the resolve of even the most enthusiastic investors.
While bulls might celebrate Friday’s early gains (the major financial markets were also higher), there’s no hard news that’s guiding the positive momentum. And investor sentiment is still shaky at best.
Luna’s collapse neared completion, though, as its sister crypto stablecoin TerraUSD—which was supposed to be pegged to the dollar—continued to flounder.
TerraUSD was down 83% to 9 cents, while Luna nosedived 95% to $0.000737 (which is still 52 times more valuable than a Shiba Inu coin).
Investors now are testing psychological levels, most notably Bitcoin, which is hovering around the $30,000 mark after tumbling to $25,401 Thursday—a level it hasn’t seen since 2020.
For many investors, this is the first crypto crash they’ve experienced. A $1,000 investment in most major coins a year ago would be worth just a few hundred dollars at this point.
Sign up for the Fortune Features email list so you don’t miss our biggest features, exclusive interviews, and investigations.