Let us go back for more or less a year to track the trends which made significant gains in the crypto market.
After the March 2020 crash due to lockdown restrictions around the world which has affected both traditional and crypto markets, coins and tokens with strong fundamentals and use case started to recover.
A month or two months after, decentralized finance (DeFi) started to gain attention after years of staying on the sidelines, more of being experimental. This was followed by a summer which resulted to impressive gains of almost all tokens which could be wrapped and staked (provided as liquidity is the proper term) in DeFi. The total value locked in DeFi went from a few millions to billions in a span of three months.
But it is not without challenges and issues. The DeFi summer as we call it now also resulted for new DeFi projects to mushroom out of nowhere, most of it are forks. Rug pull and exit scams became the talk of the space. On the other hand, it lead to the introduction of DeFi tokens to better incentivize users who take the risks of impermanent loss and being rug pulled.
The whole market went red by the end of September. DeFi tokens lost as much as half of their values. Bitcoin after multiple attempts finally broke the 12,000 resistance level on the end of October. Ethereum followed the trend by the second week of November. On the other hand, DeFi tokens made some gains too but not enough to recover the gains they made during the DeFi summer.
Bitcoin broke its all-time-high during the last bull cycle by the second week of December. Ethereum and other smart contract coins also made significant gains even outperforming Bitcoin for the next two months. Majority of DeFi tokens started to go back on the bullish track by the end of January, surpassing the gains made during the DeFi summer within a matter of week or two.
After months of being overshadowed by DeFi and smart contract coins, NFT-specific tokens started to achieve impressive growth on February. NFTs being sold in the market conquered the headlines of both crypto and traditional news outlets as millions are being poured into the niche to purchase NFTs which were considered worthless and experimental three or four years ago.
High supply tokens and meme tokens finally got their own time on March. Dogecoin competitors started to pop out giving users the hope of making quick and massive wealth in a short period of time. Rug pull and exit scams started to attract headlines again which became the main criticism of outsiders against the crypto space in addition to the lack of innovation and immaturity painted by high supply tokens and meme tokens.
The May crash followed. Elon Musk criticized Bitcoin's power hungry consensus mechanism. India and Nigeria issued warnings against Bitcoin. China banned Bitcoin and Bitcoin mining. Institutions sold their BTC. United States of America and Europe also made proposals to regulate the crypto space. Bitcoin lost at least half of its value while altcoins lost more than half.
Signs of hope started to manifest by the end of June. Despite several FUDs and unfavorable news about Bitcoin, its price was able to go back and hold on strong to the USD 30,000 level whenever it fell below it. DeFi and NFT tokens also stayed formidable on their support levels while meme tokens remained wounded by as much as 90 percent of their value.
This month we have seen impressive growth among gaming tokens. Axie Infinity's AXS and SLP led the pack with at least 100x growth followed by DPET, SKILL, MBOX and DND making as much as 1000x. Blockchain gaming combined all of the previous niches before it. Players have their characters as NFTs with the fun side of memes, the tokens they earned can be used for DeFi and some of these games also introduced or plans to have DAO as their governance model.
Is the whole crypto space back on the bullish road?
Much of the indicators remained bullish despite the May crash but the last four weeks showed us even more bullish signs and perhaps some added maturity on the market which is full of newcomers. mostly uninformed or misinformed. One thing is certain, we have more bullish reasons right now to believe that the bull cycle will continue. The only thing to be determined is if August will be able to sustain it.
Keep in mind that everything could happen in this fast-paced crypto space.
(This is not a financial or investment advice. As always, do your own research and trade at your own risk. P.S. There are grammar and spelling errors. I compose my post directly and I don't edit especially when I just woke up after three hours of sleep.)
