• Crypto market saw $100 billion liquidated in a market selloff over the last few days
• Bitcoin and Ethereum prices dropped over 4%, dragging the whole crypto market down
• Traders brace for CPI data, Fed interest rate decision, and BOJ rate decision this week
The crypto market has seen intense selling pressure in the past week, with over $100 billion in liquidations across major cryptocurrencies like Bitcoin, Ethereum, and altcoins. Investor sentiment has turned bearish amid macroeconomic uncertainty.
Bitcoin and Ethereum Price Action
Bitcoin price dropped over 4% in the last 24 hours, falling from $70,195 to $67,325. It currently trades around $67,776 with low spot and derivatives market activity. Ethereum price also declined by 4% in the past 24 hours, now sitting at $3,528 after reaching a 24-hour high of $3,711.
Reasons for the Selloff
There are several factors driving the crypto selloff:
- Impending US CPI data and Federal Reserve rate decision this week have traders bracing for impact. Options and futures traders are selling to drive further decline.
- Declining momentum for GameStop share price and related meme coins like GME is impacting sentiment.
- The US dollar has strengthened, with the dollar index rising to 105.22. US Treasury yields have also increased to 4.445%.
- Bitcoin derivatives expiry and mixed US jobs data last week hurt confidence.
Liquidations Continue to Increase
According to Coinglass, over $170 billion in crypto market cap was liquidated recently. The largest single liquidation order occurred on Binance for $660 million. About 145,000 longs and 25,000 shorts have been liquidated so far. Bitcoin and Ethereum liquidations exceeded $80 million.
The market selloff presents opportunities to buy the dip for investors with a high risk tolerance. However, uncertainty persists given the macroeconomic backdrop. Further volatility is expected this week as traders react to fresh economic data.
Conclusion
The crypto market remains under pressure from heavy selling and liquidations. Over $100 billion in assets have been wiped out in the past week due to negative sentiment from global macro factors. While crypto tends to be highly volatile, the current correction offers a test for investor conviction in the long-term growth story. Price action in major cryptocurrencies like Bitcoin and Ethereum will be telling of whether confidence returns or skepticism prevails.
