Why Is The Crypto Market Down Today?
In a rapid and compelling reversal, the cryptocurrency market threw out hundreds of billions of dollars in just one day, raising questions about the surprise announcement of the sustainability of recent earnings by the new U.S. crypto reserves. At the peak of the initial rally (after former President Donald Trump’s Sunday statement unveiled, the total crypto market cap soared from about $2.7 trillion to $3.1 trillion. But, starting with the latest reading, those gains have not only evaporated. Now, the market is about $2.6 trillion, even lower than before the announcement.
Why is cryptocurrency falling today?
“The real driving force here is toward a global move towards risk trading.” write a letter Kobeissi letter via X (@kobeissiletter). According to this analysis, increased trade war tensions and widespread economic policy uncertainty have led to a sharp review of “all risky assets”, including stocks, oil and cryptocurrencies. In contrast, traditional safe havens such as gold continue to post earnings, strengthening what people think of assassination of cryptocurrencies in turbulent times.
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This sudden decline is accompanied by amazing numbers. “In the past 24 hours, cryptocurrency has deleted a massive reversal of -500 billion US dollars.” Bitcoin initially appeared at major rally and already has fall Nearly $250 billion in market value was lost in 11 hours, about 3% below its pre-announced level.
Ethereum (ETH) saw a sharper retreat. Before the U.S. crypto reserve news on Sunday, Eth is moved The local low on March 2 is $2,173. Shortly after the announcement, it climbed to $2,550 before falling to $2,002, 8% below its pre-announcement bottom. “It seems like a huge retail trap, it’s a huge swing,” Kobeissi’s letter added, noting that the index of cryptocurrency fear and greed soared from around 20 years old (extreme fear) to nearly 55 (close to greed) before inserting for 20 seconds.
Aside from these signals, the shocking statistic exceeded the previous $500 million in the last week of February in a record $2.6 billion outflow of crypto funding. Observers suggest that despite “the most bullish announcement ever”, capital is spinning primarily due to cryptocurrencies Macroeconomic headwind.
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Meanwhile, the Haven’s assets continue to outperform the ball. “Our senior members are buying gold for several months,” Kobessixin said. Gold has climbed 10% since the beginning of the year, and analysts have predicted further upside potential. “We bought a dip for January and asked for $2,850+. On Friday, we called for another higher low of $2,850, and gold is now close to over $2,900 again,” the market commented.
If cryptocurrencies were once considered an emerging hedge against economic uncertainty, current market behavior suggests that it is now engaging with other “risk assets”, at least driven by changes in global sentiment and macroeconomic pressures, rather than sector-specific developments.
At press time, Bitcoin was trading at $83,594.
Featured images from Shutterstock, charts from TradingView.com
