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Crypto Markets Lose $100 Billion As Bitcoin Drops Below $26K – More Pain Ahead?

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The broader crypto markets have been especially shaken over the past 24 hours as Bitcoin fell below the $26,000 threshold once again. Bitcoin is currently trading at $25,168.94, down 16% from last week, according to statistics from Coingecko released on Monday.

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With bitcoin hitting its lowest level since late 2020, the entire crypto market is under pressure from recession fears, which could deter investors from taking riskier bets.

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Suggested literature | Bitcoin Fails at $27K as Crypto Economy Reaches Just Over $1 Trillion

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However, alternative coins suffered no less severely. Ethereum, for example, fell below $1,500, 70 percent off its all-time high of over $4,900 in November 2021. Over the past 24 hours, Dogecoin, TRON, and Avalanche have suffered double-digit losses.

The total market capitalization of cryptocurrencies has been trading in a downward channel over the past month and is currently maintained at $1.17 trillion.

The crypto market has become increasingly tied to traditional equity markets in recent months (CNBC).

$100 billion disappeared from the crypto market

The crypto market lost over $100 billion over the weekend after US Treasury Secretary Janet Yellen issued a grim warning about cryptocurrencies.

The market value of bitcoin has dropped to $520 billion. On a positive note for BTC bulls, their control of alternative cryptocurrencies has increased to around 48 percent.

After several short and unsuccessful attempts to exceed $32,000 over the past seven days, the world’s largest cryptocurrency began to gradually lose value. Bitcoin’s latest failure at this level brought its price down to $30,000, where it remained for several days.

BTC total market cap at $498 billion on the weekend chart | Source: TradingView.com

Rich Blake of cryptocurrency startup Uphold says:

“Cryptocurrency seems to be losing an ideal opportunity to illustrate its forgotten inflation hedge function.”

Inflationary fluctuations and Bitcoin volatility

US inflation estimates, 8.6 percent, were announced late Friday. A four-decade record has increased Bitcoin’s volatility, leading to today’s plunge to the $25,000 mark.

In recent months, the cryptocurrency market has become increasingly associated with traditional stock markets. The tech-focused Nasdaq fell 3.5%, while the S&P 500 and the Dow Jones Industrial Average were down more than 2.5%.

Suggested literature | Dogecoin mining revenues have plummeted over the past 12 months

The US Federal Reserve’s two-day meeting next week is expected to lead to further interest rate hikes. This week, Yellen also warned against including cryptocurrency in 401(k) plans, adding to the gloom.

Last week, the central banks of Australia and Canada, where inflation has also picked up, raised their rates by about 50 basis points, while the European Central Bank announced it would stop buying assets and start raising rates this summer.

Featured image from Reynolds and Reynolds, chart from TradingView.com



Credit : www.newsbtc.com

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