Crypto Markets Turn Red as $200 Billion Exits The Space

The total market capitalization of the digital asset industry has fallen 6.9% in the past 24 hours. Losses accelerated during the Asian trading session on Thursday morning when the market cap fell below $2.1 trillion for the first time in more than three months.

The big dump has taken $200 billion out of the crypto market according to Tradingview.

Total Cryptocurrency Market Cap – Tradingview.com

Total market capitalization hit an all-time high of just over $3 trillion on November 9, but it’s now down 30% from those highs. It’s too early to call it a bear market with a correction of this magnitude as the markets are still around 120% higher than the same time last year.

The main loss of cryptocurrency

Bitcoin is a magnet when it comes to the cryptocurrency markets, and when it drops, the rest follows. BTC has shed 6.3% on the day to fall to $43,370 at the time of writing. The asset is now trading 37% down from an all-time high of $69K on November 10 and at its lowest level since late September. The $40K area is a key level to watch for potential support and rebound.

The world’s second largest crypto asset, Ethereum, is in pain today as well, dropping 7.6% in the past 24 hours to $3,520 at the time of writing. ETH price is now down 28% from its all-time high in November which can be considered a good correction as long as there are no further losses.

Other crypto assets in the red this morning include Binance Coin (BNB) which is down 8.4% to $470, Solana (SOL) down 10% in a slide to $150, Cardano (ADA) and Ripple (XRP) both down by 7% each, and Polkadot (DOT) painful slippage 10.5% per day.

There are no survivors from today’s crash, and even some stablecoins are temporarily de-pegged.

Fed behind the collapse?

Cryptocurrency markets are volatile by nature and intraday recessions like this are very common. However, there may be a few factors that have an impact on the markets.

The minutes of the US Federal Reserve’s December meeting confirmed that the central bank has begun curbing stimulus efforts with rate hikes planned this year. The optimistic turn caused global stock markets to be seen in the red in late trading on Wednesday, and the downturn continued across all Asian markets on Thursday morning.

It’s a “recipe for a financial crash,” said Scott Minerd, chief global investment officer at Guggenheim Partners.