Cryptocurrencies Price Prediction: Bitcoin, Ethereum & Cosmos – European Wrap 23 January

Bitcoin price nosedives below $40,000 on bloody Monday, BTC price recovery likely on the horizon

After a market-wide bloodbath that led to a correction in cryptocurrencies with a large market capitalization, the price of Bitcoin plummeted to a low of $39,400 on Monday. However, there are indications of a potential recovery in the asset as BTC made a comeback above the psychological level of $40,000 on Tuesday. On-chain metrics are also showing positive signs for Bitcoin’s future trajectory.

One of the key drivers for the decline in Bitcoin price was the $640 million outflow from Grayscale’s GBTC on January 22. Additionally, BTC ETF outflows intensified on Monday. Despite these setbacks, the recent recovery above $40,000 indicates a possible turnaround in Bitcoin’s price.

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Cosmos validators reject proposal to reduce token inflation rate to 0%

In a close vote, the Cosmos community rejected a contributor proposal to reduce the minimum net supply of tokens to zero. The decision to maintain the status quo was made because a higher inflation rate is generally seen as a way to incentivize miners and increase network security by raising the cost of a potential attack. Proposal 868, introduced by StakeLabs in November last year, aimed to reduce the minimum set inflation rate from 7% to 0%.

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Ethereum traders realize nearly $33 million in losses as overheated futures market cools

The price of Ethereum experienced a 7% dip in the past day as the crypto market underwent a correction on Monday. Bitcoin’s drop below $40,000, a psychologically important level, was one of the contributors to the decline. As the market sentiment improves alongside a decline in the altcoin’s funding rate, ETH price may be bottoming out.

According to Ethereum’s Network Realized Profit/Loss (NRPL) metric, ETH traders suffered losses amounting to $32.73 million on Monday. This is the first time since October 13 that Ethereum traders have experienced a loss, indicating a cooling down of the overheated futures market.

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Analyst comment

Bitcoin price nosediving below $40,000 is negative news, but the potential recovery and positive on-chain metrics suggest a turnaround in the market. Cosmos rejecting the proposal to reduce token inflation rate is neutral news as it maintains the status quo. Ethereum traders realizing losses indicates a cooling down of the overheated futures market, but a potential bottoming out of the ETH price is a positive sign. Overall, the market is likely to stabilize with some potential recovery.