Why is the Crypto Market Down Today? (2024)

Elena R

Elena R
Author
Elena is an expert in technical analysis and risk management in cryptocurrency market. She has 10+year experience in writing - accordingly she is avid journalists with a passion towards researching new insights coming into crypto erena.
Jul 25, 2024 11:02 UTC
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Why is the Crypto Market Down Today? (6)

Story Highlights

Crypto market cap drops 4% due to Bitcoin and Ethereum price declines, triggering $300 million in liquidations.
Negative sentiment from US stock market losses, Ethereum ETF outflows, and upcoming FOMC meeting adds to the downturn.
Fear of crypto capitulation rises as indicated by fear and greed index and large Mt. Gox repayment.

During the early European session, the crypto market cap slipped around 4 percent in the past 24 hours to hover about $2.42 trillion on Thursday. Bitcoin (BTC) and Ethereum prices led the entire altcoin in a correction, which triggered notable liquidation.

The latest market data shows that Ethereum’s price slipped around 8 percent to trade at about $3,174. Bitcoin’s price continued with the recent correction to retest the 50-day Moving Average (MA) around $64k.

As a result, nearly $300 million was liquidated from the crypto derivatives market, mostly involving long traders.

Top Reasons Behind Today’s Crypto Slip

Ethereum ETF Outflows and Market Pessimism

The US-based spot Ethereum ETFs registered a net cash outflow of about $133 million, led by Grayscale’s ETHE, which has nearly $8 billion more to dump. The poor performance in the first two days of soot Ether ETFs has increased the crypto market pessimism.

Stock Market Woes Impact Global Sentiment

The US stock market saw a staggering loss of about $1.1 trillion in valuation over the past 24 hours—almost equivalent to Bitcoin’s entire market cap. This significant liquidation in the stock market has reverberated through global financial markets, despite a traditionally low correlation with the crypto industry.

‼️🇺🇸 Markets wipe out +$1.1 trillion from the US stocks today. pic.twitter.com/WlZkYSQrak
— Radar🚨 (@RadarHits) July 24, 2024

FOMC Uncertainty

The forthcoming Federal Open Market Committee (FOMC) statement adds another layer of uncertainty, contributing to mid-term market volatility.

Mt.Gox FUD

Bitstamp: We've received the Mt. Gox assets. We're working diligently to distribute them to our Bitstamp customers who are Mt. Gox creditors. Please allow up to one week for security checks. For UK residents, there will be a separate distribution plan. We'll inform you when the…
— Wu Blockchain (@WuBlockchain) July 24, 2024

Additionally, Bitcoin’s Fear and Greed Index has dropped to 68%, signaling increasing fear of a potential crypto capitulation. This apprehension has been partly fueled by Mt. Gox’s repayments to creditors, with over $2 billion deposited to the Bitstamp exchange in the last 24 hours.

Also Read: Peter Schiff Warns of Crypto Market Crash: FED’s Action Under Scrutiny

The crypto market is in turmoil. Are we headed for a crash, or is this just a temporary setback?