Why Bitcoin, Ethereum, and Dogecoin Lost $55 Billion in Market Cap Today

What happened

The fluctuations between the highly capitalized currencies did not take a breather today. In fact, the main cryptocurrencies Bitcoin (CRYPTO: BTC) And Ethereum (CRYPTO: ETH) Another day of backtracking. These coins are down 3.6% and 6.7% respectively in the past 24 hours as of 9:30 AM ET.

Famous meme icon Dogecoin (CRYPTO: DOGE) It also saw significant selling pressure today, falling 3.8% over the same time frame.

The cumulative losses of these three coins today are around $55 billion so far.

As for Bitcoin, deadly political protests in Kazakhstan, the world’s second largest bitcoin mining hub, have affected its mining network today.

Ethereum’s recent woes continue as losses for this token once again surpass Bitcoin, as investors look beyond the growth provided by smart block chains like Ethereum in the world of decentralized finance to move to perceived safe haven bets like Bitcoin.

Dogecoin has once again failed to see any momentum coming, with speculators and traders sitting on their hands again today.

Image source: Getty Images.

so what

Overall, it appears that the risk-off sentiment that has prevailed since the release of the Fed’s midweek meeting minutes continues to dampen sentiment among highly speculative asset classes. The possibility of prices rising sooner than expected, and consolidation of tighter monetary policy, is broadly bearish for the volatile crypto sector.

Geopolitical concerns are only exacerbating what appears to be a rotation of risky assets at the moment. Investors looking for security have generally sought out more defensive asset classes, or are looking for relatively safe havens like Bitcoin in today’s high-volume crypto world. Among the top 5 crypto coins by market capitalization (excluding stablecoins), Bitcoin is again the best performer.

What now

In the midst of a journey to safety, investors are left with few options in the cryptocurrency space. Yes, some microcodes are seeing a huge rise today. There is always opportunity in every market, and there will always be a few winners during every sale. However, the cryptocurrency market was a sea of ​​red to start the year for most coins.

The question many investors are now asking is: How long will these sell-offs last? The prolonged declines among many tokens have prompted growth investors to look elsewhere to start the year. At the moment, market volatility is working against cryptocurrency investors. Given the lack of catalysts materializing at the moment, patience may indeed be a virtue for those looking to buy this dip.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of the Motley Fool Premium Consulting Service. We are diverse! Asking about an investment thesis — even if it’s our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.