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Today, the crypto market took a nosedive, and here’s a deep dive into what’s going on:
The market’s decline has mirrored a broader sell-off in traditional markets, influenced by an uptick in geopolitical tensions and economic uncertainty. So, as traditional markets flinched, cryptocurrencies didn’t miss a beat in joining the plummet.
During the afternoon trading hours in the United States, Bitcoin took a steep fall below the $66,000 mark after nearly touching $71,000 just a few hours before.
As of press time, Bitcoin has clawed its way back to exactly $69,934, a 5% drop in the last 24 hours alone. Not far behind, Ethereum saw a dramatic 12% drop to $3,100 before paring some losses to $3,230 as of the time of writing.
The downturn wasn’t a gentle slide but more of a freefall. Futures market data pointed out a brutal session for traders using leverage. Over $400 million in leveraged positions were liquidated in just one hour.
Binance traders faced the brunt of it, with liquidations totaling $171 million, while their counterparts on the OKX exchange saw $158 million wiped out. The total damage across the market in the last 24 hours? A massive $860 million across 270,993 traders, according to Coinglass.
This market tumble coincided with a dip in U.S. stock markets, reacting to new inflation data indicating a third consecutive month of acceleration. This hotter-than-expected Consumer Price Index (CPI) print has dampened any remaining optimism for near-term Federal Reserve interest rate cuts, throwing a wet blanket on hopes that inflation was close to being under control.
Amidst this catastrophe, Bitcoin managed to bump its market dominance up to nearly 56%, hitting a peak for this market cycle. This means that even as markets tumble, Bitcoin somehow finds a way to reinforce its position as the king crypto.
Looking ahead, the crypto community has its eyes set on the upcoming halving event slated for April 21. Historical trends and expert opinions, including thoughts from Arthur Hayes, suggest that the event could trigger several more price corrections.
With all these factors at play, today’s market movements are a jigsaw of investor sentiment, economic indicators, and upcoming major crypto events.