What’s Behind Crypto Market Cap Surpassing $3T Again After 2021?

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As a seasoned researcher who has navigated through the crypto market’s high tides and low ebbs for over a decade now, I must say that witnessing the global cryptocurrency market cap reclaim the $3 trillion level again is nothing short of a spectacle. My personal journey in this digital frontier started during the nascent days when Bitcoin was still considered an obscure asset by many.

After a very long period of time, the total value of all cryptocurrencies has surpassed $3 trillion again, a level last reached in 2021. Interestingly, this year’s U.S. elections seemed to spark significant optimism in the crypto market, with former President Donald Trump returning to office. This positive sentiment seems to have triggered a chain reaction throughout the industry, leading to impressive market growth.

Here’s a summary of some significant elements contributing to the recent recovery of the total cryptocurrency market capitalization, reaching the hopeful $3 trillion mark again, which it had last achieved in 2021.

Donald Trump’s Win In U.S. Elections Sparks Crypto Market Cap Growth

Remarkably, Donald Trump’s victory and subsequent re-election as President have notably stimulated the growth of the cryptocurrency market.

Worldwide market observers are feeling more optimistic due to the former president’s pledge to make the country a hub for cryptocurrencies. Supporting this goal, a report from CoinGape Media highlights that if re-elected, Trump plans to put pro-cryptocurrency individuals in charge of key financial regulatory bodies. This is a significant factor contributing to the increased positive outlook in the digital asset market.

Moreover, as speculation grows about a potential strategic Bitcoin (BTC) reserve for the U.S. in case of the former president’s reelection, there is an overall positive outlook in the broader cryptocurrency market. Furthermore, countries like Bhutan are experiencing a surge in their BTC reserves, contributing to the increasing total capitalization of the global crypto market.

Macro & Micro Events Pour Further Bullishness Into The Sector

In recent days, it seems that various factors have contributed to the increase in the total value of cryptocurrencies. After a 0.5% reduction in interest rates by the U.S. Federal Reserve earlier this year, followed by another 0.25% cut this quarter, there’s optimism for risk assets. Additionally, investors are expecting another 0.25% reduction by the end of the year, potentially boosting the industry further.

Meanwhile, Bitcoin’s influence over the crypto market surged noticeably, approaching 60%, during this recent uptrend. At the same time, Ethereum accounted for 13.5% of the market dominance. This growing valuation suggests a thriving digital asset industry, mirroring the overall market cap reaching an all-time high of $3 trillion.

Additionally, this growth coincides with a sense of institutional fear of missing out (FOMO) after Trump’s victory in the U.S. elections. Bitcoin ETFs are experiencing significant expansion, mirroring the increasing institutional interest in the asset. Interestingly, Sosovalue data indicates billions of dollars in weekly inflows into spot BTC ETFs as November began. BlackRock is at the forefront, accounting for a large portion of these inflows, and this underscores the rising demand from institutions for the leading asset with a dominant market share. This data contributes to the escalating market capitalization, surpassing $3 trillion.

In summary, the excitement surrounding meme coins has contributed to the market capitalization reaching new heights that surpassed previous records. Notably, popular meme coins such as DOGE and SHIB have seen extraordinary gains in recent times, which in turn boosts the market’s growth. Collectively, these factors have played a substantial role in pushing the overall crypto market capitalization back above $3 trillion, a level not seen since 2021.

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2024-11-12 16:36