The Crypto markets have crashed to another low this year again. It is reported that the world’s market cap has dropped from $1.10 trillion. The market cap had shrunk to $977 billion. After attaining a global market cap of $3 trillion in November last year, the value has dropped by more than $2 trillion. Statistics have shown that almost every coin’s price has fallen by half or more of its price in comparison to their peak prices.
The primary factor that might have initiated the cryptocurrency market crash might be the colossal sell-off by investors who have been scared by the increased inflation rates. Another reason might be Celsius’-a cryptocurrency lending service, moving to pause all withdrawals. In addition, investors are avoiding riskier assets. This fear has been reflected in the stock market too.
The most popular and expensive Crypto, BTC, went below $22,000. In addition, almost every altcoin, beginning with Ethereum, took a significant blow. Ethereum has dropped to its lowermost level in over fourteen months, trading at approximately $1155. Solana is trading around $27, meaning it has fallen by more than 15%. The data is based on CoinMarketCap statistics.
According to experts, the plunge in cryptocurrency prices reflects the risk appetite of stockholders. These investors are cautious of risky crypto assets. Crypto assets are considered the most unpredictable assets to invest in because of all the volatilities and uncertainties they carry.
The co-founder of Mudrex-a crypto investment company, Edul Patel, confirmed the pressure on the crypto market has been tremendous from the Federal Reserve. Edul added that Bitcoin, and Ethereum, together with almost every Crypto asset, incurred losses due to a massive sell-off. According to Edul, the sell-off was caused by the data indicating that the United States’ inflation had peaked at a 40- year high.
He continued to add that the panic among investors has caused the amount of cryptocurrency liquidation to increase from Friday last week. Ed mentioned that Bitcoin and Ethereum suffered up to 7%, with the former trading at $22,000 and the latter at $1,200. These values are the lowest for both assets. According to the Mudrex CEO, there is a high possibility for investors to continue witnessing the same trend in the coming days.
Over the years, altcoins have consistently underperformed Bitcoin. However, a new challenge has been hurled at them as they now have to sustain possible regulatory barriers pressure. A CoinDesk report quoted an expert who said that not all altcoins could sustain the current market movements.
BuyUcoin’s CEO-Shivam Thakral blames the increasing prices of energy, food, and gas for putting a lot of pressure on the cryptocurrency market. He added that Ether and Bitcoin recorded double-digit losses in the 24 hours.
Dashan Bathija says that if the inflation numbers continue to increase, investors will expect the US Fed to speed up the process of rising interest rates.
In a note written by an analyst at WazirX Trade Desk, Bitcoin was confronted by another substantial correction as it dropped to its lowest ($18,000) in more than five months. The note also mentioned that the DYX was interestingly at a 6-month high. It had gained 2% in the past day only. The note concluded that the RSI had dropped below 30 and that BTC had entered the oversold region.
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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
