Bitcoin and Ether have both suffered double digit losses since the start of the week. This correction comes as the USD continues to strengthen and traders bet on the Fed tightening policy. Last month’s collapse of the Terra/Luna ecosystem and the suspension of withdrawals by lender Celsius have also contributed to the sell-off.
The price of both Bitcoin and Ether has declined by more than half a trillion dollars in the past 24 hours. The market cap of all crypto assets has fallen by more than $1 trillion, which is the lowest since October 2017. The sell-off reflects the broader decline in the stock market. The Nasdaq ended Friday down 2%, with many tech stocks losing ground. According to CoinGecko, Ethereum has dropped over nine percent from its previous high of $23,000.
Ethereum and Bitcoin aren’t the only cryptocurrencies experiencing double-digit losses. Several Ethereum-adjacent assets have also suffered ten-digit losses. For example, Lido’s LDO token fell 25 percent, Marathon Digital Holdings fell 12 percent, and Riot Blockchain Inc. lost nearly 10%. In addition, many other Ethereum-adjacent assets like Stratis, Block, Uniswap, and MicroStrategy are reporting losses.
The most popular cryptocurrencies like Bitcoin and Ether have been trending lower in the early morning hours, leading the cryptocurrency market lower. Bitcoin, the largest cryptocurrency by market cap, fell by 7.3% in the last 24 hours to a low of $21,500. Ether lost 6.2% to $1,730. DOGE and ADA also posted double-digit losses.
The market is undergoing a correction, and investors are expecting further pain before the final bottom is reached. Moreover, the Ethereum Merge, scheduled for mid-September, could wipe out the gains ETH has posted so far this month. Despite the downturn, the adoption of cryptocurrencies by people and businesses is a positive step.
On August 18, Bitcoin reached a high of $25,000 before plunging. Since then, a range of events has led to a range of price swings. The latest reports on retail sales, the Federal Reserve’s plans to keep raising rates, and central banks’ discussions on regulation and risk in the crypto industry has all contributed to the steep drop in bitcoin’s value. The world’s largest cryptocurrency has now fallen by over 50% so far this year. However, the cryptocurrency market has recovered from recent dips and is currently up for two of the last three days.
Tesla revealed that it had invested $1.5 billion in Bitcoin in early 2021, but has since sold off almost half of its position. As of Q2 2021, the company’s digital assets were valued at just over $18,000 each. The company also said that the impairment in the value of the Bitcoin has impacted its second-quarter profitability.