The cryptocurrency market saw a sharp decline on Wednesday, with Bitcoin taking the lead, losing $7,000 in value within 24 hours. The world’s largest cryptocurrency fell below $97,000 after reaching nearly $102,000 earlier, as retail investors took profits from recent gains.
The decline was echoed by other significant digital assets, like as Ethereum, XRP, Solana, and BNB, which added to a larger market selloff. The second-largest cryptocurrency by market value, Ethereum, plummeted 8.1% to $3,381, while XRP, Solana, and BNB all saw declines of 6.3%, 7%, and 6.2%, respectively. Cardano and Dogecoin, two popular meme coins, suffered losses of 9.4% and 9.7%, respectively.
Global Market Metrics
According to data from CoinMarketCap, the global cryptocurrency market capitalisation shrank by 6.28% over the past day, falling to $3.35 trillion. The total trading volume surged to $183.72 billion, marking a 46.94% increase, as investors rushed to reposition their portfolios amid heightened market volatility.
Decentralised Finance (DeFi) trading accounted for $11.63 billion, or 6.33% of the total 24-hour trading volume, while stablecoins dominated with a volume of $171.63 billion, representing 93.42% of the total market trades.
Broader Financial Market Impact
The selloff in the crypto market coincided with declines in traditional financial markets. The CoinDesk Market Index, which tracks 124 digital assets, slumped 6.6% in 24 hours. Meanwhile, US stock indices followed suit, with the Nasdaq 100 dropping 2%, the S&P 500 shedding 1.2%, and the Dow Jones Industrial Average falling 0.6%.
Investor caution was indicated by the US 10-year Treasury yield, which increased to 4.683% from 4.616% the day before, and the five-year yield, which increased to 4.465% from 4.421 on Monday.
