New Delhi. The earthquake in the crypto market is not showing any signs of stopping. There was a decline on Wednesday also and the world’s largest cryptocurrency Bitcoin reached its lowest level in seven months. Due to this sharp fall, crypto investors suffered a loss of more than $1 trillion.
In the New York trading session, Bitcoin fell below $90,000 and once the rate of one Bitcoin went up to $88,522. The continuing losses have shocked everyone from small retail investors to large digital-asset treasury companies. However, at the end of the day, Nvidia’s strong revenue estimates provided some relief and many crypto token prices managed to make a slight recovery from their day’s lows.
Why did Bitcoin fall flat?
According to a Bloomberg report, this year a strong rise was seen in Bitcoin and it reached $ 1,26,000. There were two main reasons for this surge. Expectation of interest rate cuts by the Federal Reserve and increased participation of institutional investors. But now both the hopes have faded. As a result, momentum traders have retreated.
Market analysts say that now the eyes of investors are fixed on the next important levels of crypto. According to experts, Bitcoin has strong psychological support near $85,000 and $80,000. Additionally, the $77,424 level, which was formed during the tariff-related turmoil in April, is now considered an important bottom.
Heavy fall in ether also
Along with Bitcoin, Ether also came under pressure and again went below $3,000. Ether looked weak compared to Bitcoin in the first half of the year, but in August it was close to surpassing its old high, reaching almost $5,000. However, now this lead has completely ended.
Market cap decreased by one trillion dollars
Talking about market capitalization, on October 6, the crypto market was at a record level of around $4.3 trillion, which has now shrunk to around $3.2 trillion. However, most of the decline is still counted as “paper loss”, meaning not that much cash has actually been withdrawn. The weakness of the market was clearly visible this week when on October 10, leveraged positions worth more than $19 billion were suddenly forcibly liquidated. The move sparked a flood of margin calls, huge outflows from exchanges and almost halted interest from new buyers in the market.
Investors are shooting in the dark
James Butterfill, head of research at CoinShares, said investors are currently “shooting in the dark” because they are getting no clear direction from macroeconomic signals. They are watching what the big on-chain investors or “whales” are doing, and this uncertainty is adding to the uneasiness in the market.
Matthew Hogan, chief investment officer at Bitwise Asset Management, said, “We are certainly nearing the end of the sell-off, but the market is still uneasy and crypto may face more volatility before finding stable ground.”
