The cryptocurrency market saw a significant drop in value on Sunday as investors sold off risky assets. Bitcoin fell by 11% in the past 24 hours, while ether dropped by 21%, leading to a total decrease of about $270 billion in the overall value of cryptocurrencies, according to CoinGecko report.
The selloff in the crypto market coincided with a wider decline in stock markets in the Asia-Pacific region. The Nikkei 225 index in Japan fell by up to 7%, continuing its losses from last week, following the Bank of Japan’s decision to raise its benchmark interest rate to the highest level in 16 years.
In the U.S., the Nasdaq composite index dropped 3.4% last week, marking its worst three-week performance since September 2022. Major tech companies like Amazon and Nvidia contributed to the decline. This drop in stocks was partly due to disappointing earnings reports, a weaker-than-expected jobs report, rising unemployment, and a struggling manufacturing sector. The U.S. Federal Reserve decided to keep its benchmark rate steady, which disappointed some investors who had expected a rate cut. Lower interest rates usually help risky assets perform better.
Bitcoin’s price is now at its lowest since February, trading at about $54,000. Despite the recent drop, it’s still up nearly 23% for the year. Ether, the token for the Ethereum blockchain, fell to around $2,300, erasing its gains for the year. Binance’s BNB token fell over 15%, and Solana is down 10%.
Investors are also watching for new trade data from China and Taiwan this week, as well as central bank decisions in India and Australia.
The recent decline in the crypto market affects a wide range of investors. This year, the SEC approved new spot exchange-traded funds (ETFs) for bitcoin and ether, which have attracted hundreds of millions of dollars. Additionally, Morgan Stanley is set to allow its 15,000 financial advisors to offer bitcoin ETFs to clients, marking a significant move for Wall Street.
In the past few days, factors such as uncertainty over the US elections, fears of a recession, and potential conflict in the Middle East have led investors to pull out of risky assets.
Israeli social media is abuzz with rumors about a new underground bunker in occupied Jerusalem designed to protect Prime Minister Benjamin Netanyahu and his team in case of a large-scale conflict with Iran and Hezbollah.
The market turmoil reflects broader anxieties as geopolitical tensions and economic uncertainties continue to drive investor behavior.
