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The relief rally that the broader crypto market experienced on Monday was short-lived. Market sentiment took a dive after BTC plunged below the $30k psychological support in the early hours on Tuesday (Asian trading hours). As of the time of writing, the largest crypto by market cap is consolidating losses above the $29.5k level after shedding 5% of its market value over the last 24 hours. With MACD gaining pace in the bearish zone, BTC will likely trend further down to test support levels in the $27.2k–$28.5k region should its rebound to above $30k fail.
On-chain metrics reveal that the crypto market is still plagued by fear and uncertainty. The Net Unrealized Profit/Loss (NUPL) metric, one that maps out the unrealized PnL of the network as a percentage of the market cap, can be used to gauge the market's pain threshold and potential bottom. Since early May, the NUPL has been fluctuating in the 18.6% to 25% range, a level comparable to the pre-capitulation phases in previous bear cycles. Despite the recent flow of troubling news and capricious market sentiment, capital continues to pour into the space, with $126 million flowing into BTC investment products last week alone.
In a similar vein to BTC, ETH is now trading below the $1,800 handle after plummeting by 6% during the same period. Major altcoins have largely flipped red, with coins that had risen significantly on Monday giving back their gains and then some.
Illuvium, an up-and-coming Ethereum-based play-to-earn game, has recently completed its first NFT digital land sale on Immutable X, which yielded more than $72 million despite the prevailing bearish sentiment in the NFT space. The sale, which started last Thursday, saw nearly 20,000 digital land plots sold as NFTs to investors and prospective players, who will stand to profit from their land holdings by gaining access to various in-game benefits. According to the creators' tweet, some of the proceeds will be redistributed to those who have staked ILV (Illuvium's native token).