- Crypto traders witnessed over $500 million in liquidations as markets reacted negatively to upbeat US jobs data, hinting at a hawkish Fed stance
- Bitcoin price plunged as low as $97,000, down 4% from the $102,750 rally recorded after US Fed VP Barr resigned on Monday
- Mega cap altcoins like XRP, ADA, AVAX suffered losses in excess of 5%, with prominent memecoins DOGE, SHIB and PEPE taking double-digit haircuts
The global cryptocurrency market witnessed a considerable setback on Tuesday as investors grappled with fears of a hawkish Federal Reserve policy. This led to significant losses for traders, with notable cryptocurrencies such as Bitcoin (BTC), Ripple (XRP), and Pepe experiencing a sharp fall in their value.
Market Overview: Major Cryptocurrencies Suffer Losses
The cryptocurrency sector contracted 6% within 24 hours, with the aggregate market cap dipping to 3.2 trillion on Tuesday. The sudden drop was triggered by traders’ negative reaction to the upbeat US jobs data, which spurred over 500 million in liquidations. Bitcoin’s price plummeted to as low as 97,000, marking a 4% drop from the 102,750 rally recorded after US Fed VP Barr’s resignation on Monday. Other cryptocurrencies, including Ethereum (ETH) and XRP, also posted losses over 5%, with meme coins like Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe seeing even steeper declines.
Bitcoin Market Update: BTC Drops to 97k
Bitcoin’s promising start to 2025 met an abrupt end on Tuesday as BTC prices plunged 6% from 102,750, eventually finding support at the 97,000 mark. This tumble came despite Bitcoin ETFs recording 987 million inflows on January 6, a surge fueled by the resignation of US Fed VP Michael Barr on Monday.
Altcoin Market Update: XRP, ADA, AVAX Lose Ground
Mega cap altcoins, including Ripple (XRP), Cardano (ADA), and Avalanche (AVAX), sustained hefty losses during the unexpected market crash on Tuesday. The global crypto market saw over 220 billion outflows over the last 24 hours, with over-leveraged bulls caught off guard by the massive market liquidation.
Chart of the Day: Crypto Crash Leads to 500 Million Losses
The cryptocurrency market witnessed a significant decline over the last 24 hours, with the total market capitalization shrinking by 6% to 3.2 trillion. This resulted in futures traders facing liquidations exceeding 500 million as market sentiment turned bearish following stronger-than-expected job openings data in the US. This reinforced expectations of a hawkish Federal Reserve policy, leading to significant liquidations in Ethereum (ETH) and Bitcoin (BTC).
Crypto News Updates
In other news, Coinbase secured an important legal breakthrough in its battle with the US Securities and Exchange Commission (SEC). Meanwhile, Rostin Behnam, Chair of the US Commodity Futures Trading Commission (CFTC), announced his resignation effective January 20, marking the end of his tenure characterized by rigorous enforcement actions in the digital asset space. On a positive note, Pierre Poilievre, leader of Canada’s Conservative party, emerged as a strong proponent of cryptocurrency and decentralized finance (DeFi).
Conclusion
As the cryptocurrency market navigates through these turbulent times, the focus remains on the shifting regulatory landscape and its potential impact on digital assets. With uncertainty looming over the global economic outlook, it remains to be seen whether the market will recover from its initial bearish reaction or continue its downward trajectory.
