The crypto market has lost more than $400 billion in a day.
Prices for ether (ETH), the second-largest cryptocurrency by market capitalization, traded in deep red along with other alternative cryptocurrencies (altcoins), tumbling by more than bitcoin (BTC) in the biggest sell-off in digital asset markets since the “Black Thursday” of March 2020.
- At press time, ether was trading at around $2,469.50, down 26.36% in the past 24 hours, according to FTX and TradingView, marking the biggest daily loss for ether since March 12, 2020.
- There has also been a huge market dump in the decentralized finance sector, with DeFi-related tokens among the biggest losers, according to Messari. They included maker (MKR), yearn.finance (YFI), compound (COMP), uniswap (UNI), and chainlink (LINK).
- “They are all dumping today and all correlating,” said Joel Kruger, currency strategist at LMAX Digital.
- Notably, the price for dogecoin (DOGE), the popular meme-centered cryptocurrency, also followed the broader market sell-off and was down by more than 20% in the past 24 hours to about $0.379, according to CoinDesk 20.
- “Without significant mainstream adoption, recognition and utility, alts are, and have always been, more speculative in nature than bitcoin,” said Hunain Naseer, senior editor at OKEx Insights. “This means they rise faster during bull runs and drop sharper during declines.”
- The correction across digital assets has caused a loss of more than $460 billion in the past 24 hours for the crypto’s total market capitalization.
- According to TradingView, the total market capitalization for crypto assets now stands at around $1.565 trillion, down 21.96% in the past 24 hours.
- “The catalyst is a market that had been deeply at risk for a pullback following a parabolic run up and a market that is feeling a little more pressure from global macro forces that are weighing on risk correlated assets,” Kruger said.
- “The biggest risk to crypto now, at least over the coming weeks, is risk that we see downside pressure in U.S. equities,” he added.
- Also on Wednesday, U.S. stocks started falling, led by major losses on shares of tech stocks, according to the Wall Street Journal.