The drop in the value of stocks around the world is casting a negative light on the crypto market. This could suggest they are going to decline value in the near term.
A big sell-off happened in the crypto market, taking out more than $150 billion in value in just two days. The overall market value has dropped to $2.1 trillion, which is the lowest it has dropped in several weeks.
Crypto Market Down: BTC Sees 3-Week Low at $60.5K
The most widely traded cryptocurrency, Bitcoin (BTC), has taken a big hit, falling to $60,500. This price level is BTC’s lowest level since the middle of July. This quick drop came after a short rise to $70,000 on Monday, which was triggered by Donald Trump’s speech at the 2024 Bitcoin Conference in Nashville, which he supported.
Although, soon after, pessimism took over, which was made worse by a weaker-than-expected jobs report that showed the highest jobless rate since October 2021, at 4.3%.
As fear spread, millions of dollars were taken out of spot Bitcoin ETFs, which put even more pressure on the asset. Nevertheless, whales are still buying Bitcoin and moving their holdings off of exchanges, even though Bitcoin has been performing slowly lately.
According to Glassnode’s whale net position change metric, Bitcoin whales with at least 1,000 BTC have transferred more Bitcoin out of exchanges than at any other time in the past nine years. In the past 30 days, around 64,000 BTC has been moved out of whale exchange balances.
Currently, BTC has rebounded slightly and is hovering around $61,900. Its market capitalization has dropped to just below $1.22 trillion, with its dominance over alternative cryptocurrencies hitting 55%.
Ethereum Loses $3,000 Support Line
Not much better for Ethereum (ETH), which has fallen below the critically important $3,000 mark. The value of the cryptocurrency is down 4% and is now selling at about $2,850. ETH has fallen below the 200 Exponential Moving Average (EMA), which is usually a sign that prices are going down.
ETH has fallen below this important technical sign twice since November 2023. Data from Coinglass shows that ETH liquidations have hit $80 million in the past day, with long positions contributing $71 million and short positions contributing $8.6 million.
ETH’s support level right now is between $2,852 and $2,803. In the past, buyers have defended this range more than once in the last four months, which suggests that prices may settle down before they attempt to go up.
The 50-day Simple Moving Average (SMA), which is $3,357, could be a big obstacle, though. ETH’s positive outlook could be thrown out the window if it falls below the $2,803 support level. This is especially true since outside factors like the Mt. Gox BTC repayment add to the bearish tone.
Altcoins Red Market
Even more sharp drops have been seen in the bitcoin market. In the past 24 hours, the prices of Solana (SOL), Toncoin (TON), and Uniswap (UNI) have all dropped by more than 5%. Other altcoins also lost substantial amounts of value. FLOW dropped by 12%, MKR by 9.5%, and WIF by 9%.
Arkham Intelligence claims that over the last three days, Genesis Trading shifted about 32,256 BTC and 256,775 ETH, which are worth about $2.1 billion and $838 million, respectively. This action, which is part of the ongoing bankruptcy process, has made the market more likely to sell.
The value of all crypto assets on the market has dropped by $100 billion in the past day, making the overall drop even bigger.
The weakness in global equity markets is casting a shadow of uncertainty on risk assets. The Japanese stock market, Nikkei, plunged 6% on August 1, marking its steepest decline since the “Black Monday” crash of 1987. If the sell-off extends to the cryptocurrency markets, Bitcoin’s $60,000 support level may come under serious threat.
Despite short-term weakness, analysts maintain a positive outlook on Bitcoin’s long-term potential. Popular analyst Willy Woo recently predicted that if financial institutions allocate just 3% of their portfolios to Bitcoin, it could drive the cryptocurrency’s price to $700,000.
