Decentral Block Post

The S&P 500 Index soared 5.85% last week, its best performance since November 2022. A large part of the gains were fuelled by expectations that the Federal Reserve will not hike rates anymore. 

In comparison, Bitcoin (BTC) had a much muted performance with a rise of approximately 2%. However, a positive sign for cryptocurrency investors is that a risk on sentiment is likely to benefit the crypto space.

Bitcoin’s rise attracted investments in several beaten-down altcoins, which are rising from their long-term slumber. If Bitcoin does not collapse, the recovery may spread to coins that have still not participated in the rise.

Even as Bitcoin enters a range, select altcoins are showing signs of moving higher. Let’s look at the charts of the top-5 cryptocurrencies that may extend their rally in the next few days.

Bitcoin price analysis

Bitcoin continues to trade near the $35,000 resistance and the price action of the past few days has formed an ascending channel pattern. After a sharp rally, a tight ascending channel is generally considered a negative sign.

Ether (ETH) price surged by 6.2% from Nov. 3 to Nov. 5, but the altcoin faces difficulty in breaking the $1,900 resistance. Despite the current bullish trend, Ether's 17% return over the last 30 days falls short of Bitcoin's (BTC) impressive 27% gain during the same period.

Regulatory hurdles and ecosystem centralization critiques linger

Analysts attribute some of Ether’s underperformance to uncertainty surrounding Consensys, a key player in the Ethereum ecosystem. Former employees have filed a lawsuit against the company and its co-founder, Joseph Lubin. Over two dozen shareholders of the Swiss-based holding company, Consensys AG, claim that Lubin, who is also a co-founder of Ethereum, violated a "no-dilution promise" made in 2015.

Consensys is responsible for developing and hosting infrastructure projects crucial to the Ethereum network. It was founded in October 2014, about nine months before the Ethereum blockchain launched in mid-2015. Furthermore, the High Court of Zug in Switzerland ruled in favor of the plaintiffs, exacerbating the current uncertainty.

Regulatory challenges have hampered the growth of the Ethereum ecosystem. The latest concern centers around PayPal's U.S. dollar-pegged stablecoin, PYUSD, which operates on the Ethereum network. This token is designed for digital payments and Web3 applications. On November 2, PayPal disclosed a subpoena it received from the U.S. Securities and Exchange Commission (SEC).

In addition to regulatory pressures, there has been notable criticism of the decentralization of financial applications (DeFi) within the Ethereum network. Chainlink, a preferred solution for oracle services, quietly reduced the number of participants in its multi-signature wallet from 4-out-of-9 to 4-out-of-8. Analysts have highlighted the lack of governance by regular users as a significant issue.

The long-awaited “crypto spring” may be upon us as Bitcoin (BTC) and other cryptocurrency markets rise in anticipation of a full-on bull market. 

Over the recent crypto winter, many different projects have been growing, gaining users and building new networks. Some of these, like Polygon, are layer-2 (L2) solutions to help scale the primary protocol, Ethereum. But what are the implications of L2s? Are they a better protocol to build on or invest in? Are other layer 1s (L1s) doing anything to stay competitive?

These questions and more are the focus of a new report from the Cointelegraph Research Terminal. The report looks at up-and-coming projects in the cryptoverse, as well as case studies for L1s like Avalanche and Hedera and how they compare to the new tech that is on the rise.

Download the report on the Cointelegraph Research Terminal.

Cointelegraph’s “L1 vs. L2: The Blockchain Scalability Showdown” report is a primer to why scaling solutions are necessary for the shortcomings of L1s. The report provides explanations of what is currently going on in the world of scalability solutions to bridges and projects that focus on interoperability.