Ethereum (ETH) fell during the May crypto market meltdown, resulting in a significant drop in the market value of the first smart contracts-backed blockchain technology.
In June 2022, Ethereum is still the second-largest digital asset by market capitalization. According to Be[In]Crypto analysis, ETH closed the fifth month of the year with a market cap of roughly R3.6 trillion.
This was a 31% decrease from the market value on the first day. On May 1, ETH had a trading volume of R236 billion, corresponding to a market capitalization of over R5.2 trillion.
Why is market capitalization declining?
A widespread sell-off of digital assets by holders in 2022, which intensified during the week of May 9 to 13, can be blamed for Ethereum’s declining market capitalization.
Rising interest rates, inflation, and the economic uncertainty that has engulfed the whole financial system as a result of Russia’s aggressive invasion of Ukraine are some of the key causes that have contributed to the negative market sentiment.
On May 12, the number of major transactions involving Ether peaked at 16,950 at a price of R29 916. This resulted in a significant transaction volume of 12.25 million ETH (1 ETH = R29 916), which amounted to around R367 billion.
ETH opened at R31 841 on May 12 and fell to an intraday low of R26 862. The trading volume was roughly R653 billion, resulting in a market cap of approximately R3.6 trillion.
On the first-day market value of Ethereum dropped by 30%. Because of the price drop that saw ETH reach its lowest position since July 2021, the coin was unable to rebound from its local lows for the remainder of the month.
ETH price movement
Ether opened at R41 962 on May 1, to a monthly high of R45 451 on May 5, tested a monthly low of R26 452 on May 27, and completed the month at R29 850.
Overall, the difference between the opening and closing prices of ETH in May is 28%.