Following the steep drop in Bitcoin (BTC), Fantom dipped sharply from its over $1.60 high in early March.
What happened?
Fantom’s price is at the mercy of Bitcoin, which fell briefly to below $40,000. Fortunately, BTC is holding the $40,000 line this month. Markets continue to correlate cryptocurrency prices to the stock market. In particular, it is following the direction of the technology and fintech-heavy Nasdaq index. Fantom holders are likely the same people invested in stocks. When Nasdaq falls, they need to sell shares to meet margin calls.
The price of other cryptocurrencies, like Etherium and Litecoin, also weigh on Fantom prices. Both cryptos peaked last November, rallied at the start of this month, and are at risk of falling again.
A few days ago, Fantom did not get help from a bearish sentiment score from the site InvestorsObserver. Still, the score adds little insight to Fantom’s weakness. Fantom’s uniqueness compared to Ethereum may help it trend higher on its own. For example, Fantom is scalable and supports instant transactions at almost zero cost. Conversely, other cryptocurrencies require proof-of-work, which requires lots of energy. This is unhealthy for the environment. Furthermore, Fantom has a low fee structure. Users may facilitate transactions using Fantom at lower fees demanded by Ethereum.
Keep a close eye on Fantom. The ecosystem is suitable for payments and decentralized finance.
