The American bank Citi states in a report published on Friday that the crypto market is holding up well. The bank’s analysts rely on a number of data, including the decreasing correlation with equities. That writes CoinDesk based on the report.
Crypto correlation is declining, but so is search volume
The report shows that the crypto market again shows less correlation with the traditional stock markets. That correlation peaked last year, but has declined since then. In addition, Citi analyst Alex Saunders states:
“Trading volumes remain robust, however on-chain and search activity has proven unsustainable.”
Search volumes remain low despite the price increases since the beginning of 2023. In addition, the activities are also around non fungible tokens (NFT) still well below the 2022 average.
Stablecoins remain stable despite volatile situation
Recently it was read in the crypto news that the US Securities and Exchange Commission (SEC) wants to sue stablecoin publisher Paxos. Paxos is the company behind Binance’s stablecoin, Binance USD, among others.
Huge outflows could therefore be observed with that stablecoin, according to Citi. More than $3.5 billion of the market capitalization evaporated. The vast majority of that flowed towards tether (USDT), one of its competitors.
All in all, the stablecoin market cap is still consolidating. The stabilization comes after a period in which the stablecoin market experienced a massive contraction due to the situation at FTX.
Activities on Ethereum
Citi also made statements about its activities on Ethereum (ETH). According to the bank, the total value locked (TVL) on the network has not yet gained momentum as was the case with the ETH price.
However, a stabilization can be observed at the decentralized exchanges (DEX). Trading volumes on the trading platforms have decreased considerably in recent times, but now seem to be consolidating.