Why Is Crypto Up Today?
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The crypto market is up today, boosted by US President-elect Donald Trump officially nominating the pro-crypto advocate Paul Atkins as the US Securities and Exchange Commission (SEC) Chair.
This news may influence the prices for a few more days.
Today, the global cryptocurrency market cap went up 2.5% over the past 24 hours, reaching $3.88 trillion, moving closer to $4 trillion.
Additionally, the total daily crypto trading volume increased to $498 billion today, the highest we’ve seen in a long time, and moving to the $500 billion mark.
Also, the majority of the top 100 coins par market cap are up today.
Top 10 Coins Are Up By 4.7% On Average Today
While only one coin in the top 10 coins per market cap was down yesterday, two are down today.
XRP (XRP) fell 5.9% to $2.4, and Binance Coin (BNB) decreased by 4.8% to $734.11.
On the other hand, the highest increase is Dogecoin (DOGE)’s 8.7% to the price of $0.44672.
The second-highest gainer is Bitcoin (BTC). It increased by 7.4% and finally surpassed the $100,000 mark, now standing at $102,795. Also, Bitcoin’s dominance surged by 4.4% to 57%.
At the same time, Ethereum (ETH) recorded a 5.9% increase to $3,927, coming close to the $4,000 level.
Notably, crypto exchange Bybit has allowed mainland Chinese users to trade via VPN but prohibited yuan transactions, balancing user demand with regulatory compliance.
Meanwhile, the US spot Bitcoin exchange-traded fund (ETF) market saw a surge in activity on Wednesday, with total inflows reaching $557 million.
Top 10 Meme Coins Are Up By 5.25% On Average Today
Unlike yesterday, when all meme coins were up, two are down today.
The red coins we see now are yesterday’s best performers.
Memecoin (MEME) fell 3.14% to the price of $0.01676.
Banano (BAN) dropped 5.2%, now trading at $0.14413.
At the same time, Turbo (TURBO) increased the most: 11.1% to $0.00861.
The top coin, Dogecoin (DOGE) is up 9%, trading at $0.44791, while Shiba Inu (SHIB) and Pepe (PEPE) are up around 7% each, standing at $0.00003 and $0.00002, respectively.
TURBO has been added to the major crypto exchange Coinbase’s listing roadmap on December 4, with the price positively reflecting the news.
Meanwhile, the new meme coin Catslap (SLAP) starts trading on the MEXC centralized exchange on November 30, only two weeks after launching on DEXs.
Top 10 AI Coins Are Up By 5% On Average Today
Similarly to other categories, not all coins in the AI coin category are up today.
Two are down. Oasis Network (ROSE) fell 3.65% to $0.12844.
BitTensor (TAO) is also red, but its decrease is minor. Its price is practically unchanged at $686.15.
The day’s top gainers in this category are Echelon Prime (PRIME) with a 17.5% rise to $15.21, and Render (RNDR), which appreciated 16% to $10.17.
Near Protocol (NEAR), the top coin in this category, went up 3.54%, now trading at $7.7.
On December 3, Oasis launched Blockvote, a novel platform that allows anyone to run privacy-first polls, designed for DAOs, with fully customizable voting systems, among other key features.
Today, it has committed $5 million to support registered real-world asset Midas in the deployment of Treasury Bill tokens, mTBILL, on Sapphire.
Top 10 Metaverse Coins Are up by 4.5% on Average Today
This category has seen a drop compared to yesterday’s all-up picture and to other categories on this list.
Four of the top 10 metaverse coins per market cap saw their prices decrease today.
Axie Infinity (AXS) fell the most: 5.1% to $9.44.
And while the majority of increases go up to 3%, the two best performers recorded double-digit rises.
Render (RNDR), the second-highest coin, is up above 15% to $10.19, while Stacks (STX) went up 11.53%, trading at $2.92.
The first coin in this category, Internet Computer (ICP), fell 3.2%, currently changing hands at $14.7.
Over the last day, the Render team announced their new download manager, a novel way for 3D artists to save their renderings directly to any location on their local drives, as well as the Advent Calendar Competition.
Additionally, it’s the final hours to vote on RNP-016, 017, and 018.
Top 10 Gambling Coins Are Up By 7.3% On Average Today
The gambling coins saw quite a shift today and significant increases, with only two drops.
FUNToken (FUN) is down 7.85% to the price of $0.0055, while BonusCloud (BXC) dropped 1.3%, trading at $0.0001.
At the same time, DeGate (DG), Ridotto (RDT), and Dotmoovs (MOOV) saw double-digit increases.
MOOV is the day’s best performer, having risen 18.43% to the price of $0.00294.
Rollbit Coin (RLB), the number one coin in this category, appreciated 7.25%, now trading at $0.1411.
Today, the Dotmoovs teased the arrival of “the feature of competition.”
“Get ready for AI battles on chain,” they tweeted. #Your skills, matched and evaluated by dotmoovs’ motion detection AI, all from your screen.”
Read more: What’s Happening In Crypto Today? Daily Crypto News Digest
Key Factors Behind Crypto Market Increase
The cryptocurrency market is influenced by a wide variety of factors. Each may affect it differently, but the price will likely reflect it.
Some of these factors are close to home, so to speak. However, some are seemingly far removed yet intertwined with the crypto market to a certain degree.
Here’s a comprehensive list of key reasons why the crypto market might go up.
1. Positive Market Sentiment
- Investor optimism: When investors feel confident about the future of cryptocurrencies, they are more likely to buy. Subsequently, this drives prices up.
- Media coverage: Positive media stories can create a ‘FOMO’ (Fear of Missing Out) effect, prompting more people to enter the market. The power of media coverage shouldn’t be underestimated.
2. Fundamentals
- Transaction volume: Transaction volume plays a vital role in coin and token prices. In addition, total value locked (TVL), a measurement of activity on smart-contract blockchains, becomes an important fundamental measurement that can impact prices.
- Revenue: Mining or staking revenue reflects the health of the network by ensuring decentralized participation in consensus when revenues are strong. In proof-of-stake networks, investors can share in these yields.
- Yields: Beyond proof-of-stake yields, certain crypto tokens act as a ‘key’ to earn yields on decentralized protocols.
- Chart technicals: Chart technicals often play a large role in trading, now magnified by automated trading. Traders worldwide make trading decisions based on technical indicators, which, in a relatively small market, can create a self-fulfilling prophecy.
3. Market Liquidity
- Increased liquidity: A larger and more liquid market allows for smoother trades and less volatility. This makes it easier for institutional investors and others to buy in.
- Creation of new trading pairs: More exchanges offering a variety of crypto-to-crypto and fiat-to-crypto trading pairs can increase market activity and drive prices up.
4. Institutional Adoption
- Institutional investments: This is a commonly referenced factor in crypto market performance. When large institutions—like hedge funds, pension funds, and publicly traded companies—invest in crypto, it increases credibility and can lead to significant price increases.
- Famous endorsements: Popular individuals, groups, or entities have been increasingly present in the crypto sphere. Public figures, large financial institutions, or companies like Tesla endorsing or accepting crypto can have a positive effect on prices.
5. Regulatory Clarity
- Clear regulations: Regulations can make or break crypto adoption in any given country. When governments provide clear guidelines and regulations for cryptocurrencies, they reduce uncertainty and make the market more attractive to investors.
- Legalization: Countries adopting favorable laws toward crypto can boost the market. These include legalizing its use or launching government-backed digital currencies. A positive outlook on stablecoins is beneficial as well.
6. Technological Developments
- Upgrades and improvements: Major updates or improvements to blockchain technology can increase the overall value of cryptocurrencies. Ethereum’s massive shift to Ethereum 2.0 is an excellent example.
- Innovation: The crypto sphere is nothing if not innovative. New blockchain applications and emerging technologies can create new use cases, thus attracting more investments. Examples include decentralized finance (DeFi) and non-fungible tokens (NFTs).
7. Network Effects
- Increased adoption: All these factors, in one way or another, contribute to crypto adoption. As more people use and hold cryptocurrencies, their value tends to increase due to the growing network effect. The more people use them, the more valuable they become.
- Partnerships and collaborations: Crypto projects often sign partnerships with companies both within and outside this novel (and still relatively small) industry. When blockchain projects form alliances with other industries or platforms, their utility and value can increase.
8. Mainstream Adoption
- Acceptance by companies: Mainstream adoption typically leads to price increases. When large businesses (e.g., PayPal, Starbucks, and Amazon) accept cryptocurrencies as a payment method, it drives demand.
- Integration with financial services: The inclusion of cryptocurrencies in traditional financial services can open the market to more investors. We have recently seen this with the major success of exchange-traded funds (ETFs) launches. Additional spot ETFs, besides BTC and ETH, are also anticipated.
9. Scarcity and Supply
- Limited supply: Cryptocurrencies like Bitcoin have a capped supply, which can create scarcity and drive prices up as demand rises. Simply said, when demand exceeds supply, prices typically increase.
- Mining halving events: Events like Bitcoin’s quadrennial ‘halving’ (where the reward for mining Bitcoin is cut in half) reduce the supply of new coins, which can result in a price increase.
10. Deflationary Mechanisms
- Burning tokens: This is a well-known and widely accepted deflationary mechanism. Some projects periodically burn (that is, permanently remove from circulation) a portion of tokens to reduce supply. This approach increases the coin’s scarcity, which can push prices up.
11. Global Economic Conditions
- Inflation hedging: Cryptocurrencies are often seen as a hedge against inflation or currency devaluation, especially in uncertain economic times. This is particularly true for Bitcoin.
- Currency depreciation: In countries with weak or depreciating fiat currencies, people may turn to crypto as a store of value. This, in turn, increases the adoption rate, hence the price.
- Low interest rates: When interest rates are low in traditional markets, crypto may become more attractive as an alternative investment. This, along with the previous two factors, may easily be an entry point for crypto newcomers as well.
12. Macro Events
- Geopolitical instability: Globally, a number of countries will suffer geopolitical turmoil at any one time. In regions affected by political or economic instability, cryptocurrencies may be seen as a safer store of value, prompting demand.
- Global events: As we witnessed in 2020-2021, (unpredictable) events like the pandemic, natural disasters, or other significant global events can significantly influence the crypto market. They can spur the use of crypto due to its decentralized nature and ease of transfer.
13. Global Financial Crises
- Flight to alternative assets: Tightly intertwined with the previous two sections, financial crises worldwide are a major factor in the crypto price movements. During times of economic turmoil, investors often look for alternative assets. Notably, cryptocurrency is now seen as one such option.
- Weakened trust in traditional financial systems: Trust plays a major role in any financial system. However, if traditional financial systems or banks are perceived as untrustworthy for any reason, people may move their assets to cryptocurrencies.
14. FOMO (Fear of Missing Out)
- Price surges: Crypto prices may jump high and fast for a variety of reasons. This event can trigger FOMO. When this happens, more retail investors rush to buy in, thus driving prices even higher.
- Social media buzz: Social media apps are a notable player in the crypto sphere. Platforms like Twitter, Reddit, and Telegram can amplify hype, creating massive waves of interest in certain coins. This typically affects the prices of individual coins surrounded by a commonly short-term hype.
15. Market Manipulation
- Whale activity: Not all factors are positive, even if they lead to a short-term price surge. Large holders of cryptocurrencies (so-called whales) can create artificial market movements by making large trades, creating price spikes. When a massive buy order is placed, the price of that particular crypto may jump because it sends a signal to the market that it’s in higher demand. However, the opposite is also true.
- Pump-and-dump schemes: Typically illegal, price manipulation schemes can briefly spike market values. In these schemes coins are intentionally, artificially inflated, then quickly sold off.
16. Security and Privacy Enhancements
- Better security: Security and privacy are some of the major concerns among potential and existing crypto investors. However, when blockchain networks are strengthened and made more secure, investor confidence increases, driving prices up.
- Privacy features: Cryptos with strong privacy features (e.g., Monero, Zcash) may become more attractive in a world with growing concerns over data privacy. However, they may face higher levels of regulatory scrutiny.
17. Increased Access to Crypto
- New exchanges and wallets: As is well known and often discussed, if the sector wants to see mass adoption, it must create user-friendly platforms that are easily available, have clear use cases, and make it simple for people to buy, sell, and hold crypto.
- Decreased transaction fees: Fees matter. When platforms reduce transaction costs or fees—which can also happen through technological advancements—they can become more attractive for traders, further boosting the market.
18. Strong Community Support
- Community-driven projects: Communities are a major driving force in this nascent sector. Cryptocurrencies with strong, active, and loyal communities often see more support during market rallies as their users actively promote and invest in the project.
- Grassroots movements: Social movements or events supporting specific cryptocurrencies can create surges in interest and, thus, in price.
Conclusion
These are the largest factors to keep in mind when discussing cryptocurrency market price movements.
It is important to remember that they are not isolated from each other. Rather, each is typically intertwined with several others on this list.
Therefore, each of these factors can act individually or in combination to influence the price movements of cryptocurrencies.
Often, the market is a dynamic interplay of many of these elements. This, in turn, creates the volatility that crypto markets are known for.
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