Global sources indicate that the cryptocurrency market currently stands at a valuation of $978 billion, down from over 11% of the $1 trillion capitalization. The fall in the value of cryptocurrencies has in 2022 resulted in every top coin dropping to half or lesser than its all-time highs.
Why this is happening
The trigger for the crash is as crypto investors appear to be selling off their crypto assets amidst inflation concerns. Crypto investors are also avoiding risky assets, which is negatively impacting the performance of the stock markets.
State of play
Bitcoin, the highest valued crypto, fell from $49,000 in March 2022 to under $25,000 this June.
- Other altcoins such as Ethereum are also experiencing deflated prices, with the value hitting its lowest price in over a year, trading at about $1200.
- Solana is also trading at around $27, falling over 15%, according to CoinMarketCap at the time of this report.
What experts are saying
- Edul Patel Co-Founder and CEO of crypto investment platform Mudrex “the crypto market has been under pressure from the Federal Reserve, hiking the interest rates to combat inflation over the past few months. Bitcoin, Ethereum, and most cryptocurrencies suffered losses over the weekend after a broad sell-off following the data showing US inflation hitting a 40-year high.”
- Shivam Thakral, CEO of crypto exchange BuyUcoin said “that the rising food, gas, and energy prices are putting tremendous pressure on the crypto market as Bitcoin and Ether have witnessed double-digit losses in the past 24 hours.”
- Darshan Bathija, CEO of crypto exchange Vauld, said “most investors worry that unless inflation numbers start dropping soon, the US Fed may have to tighten reigns by increasing interest rates at a faster pace than anticipated.”
What you should know
- According to price-charts, the popular cryptocurrency, Bitcoin, had support at the $29,000 cap, but with the recent fall, the cryptocurrency could drop to its 2017 level of about $20,000.
- The fall in Bitcoin has also affected the performance of altcoins as Ether, for example, fell by 17% today, as it currently trades at $1,210 at the time of this writing.
- The altcoins market currently caps at $510.6 billion, down from about 27% in just 13 days in June, 2022.