Ethereum experienced a significant drop, reaching its lowest price in 2024, with a decline of nearly 8% over a 24-hour period. CoinGecko reported that the second-largest cryptocurrency fell to $2,193, a level not seen since the previous year. This decline is worse than most other major coins and tokens, as Ethereum has fallen by 13% over the past week.
Bitcoin also faced a sharp decline, dropping to $52,690 and then recovering slightly to $53,516 after a 5% decrease in the past day. The approval of spot Bitcoin exchange-traded funds (ETFs) led to investors cashing out rapidly, putting pressure on the asset.
The current market capitalization of the entire cryptocurrency market has fallen by 6% in the past 24 hours, dropping below the $2 trillion mark for the first time since February. Additionally, data from CoinGlass indicates that over $272 million worth of positions in all cryptocurrencies were liquidated in the past day. Long positions, which place bets on the price of an asset increasing, accounted for $221 million of the liquidations.
This plunge in the market coincides with investors selling off “risk-on” assets like cryptocurrencies and equities due to weaker-than-expected data from the U.S., causing global market uncertainty. The American stock market has also experienced its worst week since March 2023, with technology stocks being hit hard.
Attention is now turned to the Federal Reserve, as investors anticipate a rate cut from the central bank. However, the size of the cut remains uncertain. Previously, under the leadership of Chair Jerome Powell, the Fed raised interest rates to address inflation resulting from the Covid-19 pandemic, reaching a 23-year high.