The crypto market has experienced a drastic decline with market capitalization plummeting by $490 billion.A consistent weakening in Bitcoin (BTC) prices since August 2, 2024, triggered this drop, with Bitcoin falling from $65,000 to a low of below $50,000 on August 5, 2024.
According to TradingView data, the total crypto market capitalization has dropped from a high of $2.27 trillion on August 2 to $1.75 trillion in just three days.
This figure marks a decline of more than 23% over the period from August 2 to August 5, the first occurrence since mid-August 2023.
The continuous weakening of Bitcoin prices largely influenced the decline in market capitalization.. At the time of writing, Bitcoin is still attempting to hold at the $50,200 level, after briefly touching $49,855. Overall, the crypto market is experiencing a massive sell-off. Ethereum (ETH) has dropped by 23% in the last 24 hours, reaching around $2,218. Meanwhile, BNB and XRP have each fallen by 19%.
Liquidations Hit $1 Billion in 24 Hours
Meanwhile, total liquidations in the crypto derivatives market have reached $1.03 billion, equivalent to IDR 16.6 trillion in the last 24 hours, with long positions suffering the most with around $898 million, or IDR 14.5 trillion, liquidated, according to CoinGlass data.
Unstable economic conditions in the United States, slow growth among tech stocks, and renewed recession fears largely influence this market downturn.
Major tech companies like Microsoft and Intel reported Q2 2024 earnings below Wall Street analysts’ expectations.
The crypto market is expected to face a tough week with significant losses occurring over the weekend.
The CME Gap has entered Bitcoin, but traders can technically fill it only during traditional financial (TradFi) trading hours.. With that in mind, there is a small chance that we will see BTC prices recover for the weekly close,” wrote Keith Alan, Co-Founder of Material Indicators, in an X post on August 4.
The CME Gap refers to the difference between Bitcoin’s closing price on the Chicago Mercantile Exchange (CME) and its opening price when trading resumes. This occurs over the weekend or after the market closes for a certain period.
Marcus Thielen, Head of Research at 10x Research, predicts that Bitcoin prices will fall back below the $50,000 level and potentially lower if the US economy continues to weaken.
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