Major coins traded in the red on Monday night as the global cryptocurrency market capitalization fell 1.49% to $1.88 trillion.
What Happened: Bitcoin (CRYPTO: BTC) traded 2% lower at $42,392.12 over 24 hours. For the week, the apex cryptocurrency has risen 1.38%.
The second-largest coin by market cap, Ethereum (CRYPTO: ETH), fell 3.82% to below the key $3,000 level at $2,948.39. Over the last seven days, ETH has risen 1.3%.
Dogecoin (CRYPTO: DOGE) was down 1.93% to $0.20. Over a seven-day trailing period, the meme cryptocurrency has fallen 1%.
See Also: How To Buy Bitcoin (BTC)
Perpetual Protocol was the top 24-hour gainer at press time, as per CoinMarketCap data.
PERP rose 20.45% in the period to $16.48. Over the course of a week, PERP has shot up 35.99%.
PERP, which claims to be the first virtual automated market maker, rose 22.83% and 25.05%, respectively, against BTC and ETH over 24 hours.
Why It Matters: The specter of a regulatory crackdown, particularly the latest originating in China, has seemingly shifted trader focus on DeFi, or decentralized finance, segment.
Analysts are of the view that China’s cryptocurrency industry will wither away in light of the stand taken by the country’s central bank.
Jonas Luethy, a sales trader at the United Kingdom-based digital asset broker GlobalBlock, noted the suspension of new customer acceptance from mainland China on offshore Chinese exchanges such as Huobi and a parallel increase in DeFi exchange usage.
China-based SparkPool, an Ethereum mining pool, said Monday on Twitter that in order to be “maximumly complaint” with the regulatory requirements it had stopped providing services t new users on mainland China on Sept. 24 and now it shut down all services and operations on Sept. 30.
“Decentralised exchanges Uniswap and Sushiswap have seen a surge in usage, which is likely a result of China’s ban on [centralized] exchanges,” Luethy said in an emailed note.
“Since DEX’s only require a crypto wallet and no KYC, it is much easier to use and can be set up in a matter of minutes.”
Meanwhile, on-chain analytics firm Glassnode noted the relatively low utilization of the Bitcoin block-space with transaction counts hovering currently around 175,000 to 200,000 transactions per day, which are levels not seen since the 2018 bear market.
The bear case made by Glassnode is that the near 50% correction in May flushed out many retail traders and investors and thus the interest in BTC protocol has ebbed since early 2021.
Conversely, the bull case being that growing adoption of efficient transaction mechanisms such as SegWit, transaction batching, and Lightning Network has resulted in the scenario.
“The most likely case is both of these are in effect,” Glassnode wrote in its latest weekly note.