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Bitcoin’s sudden crash turns Crypto market into Red Sea  

The crypto market turned all red in the early hours of Tuesday as Bitcoin lost more than 6% of its value to drop around 66K before stabilizing close to 67K on increased demand for the haven currency.  The US dollar index, relative to major fiat currencies—broke above 105 index points for the first time, increasing the four-week gain to 2.58%. currency-denominated assets, such as gold and bitcoin, become more expensive when the currency strengthens, which may reduce demand.  

Furthermore, it is well recognized that persistent dollar strength results in global financial tightening, which reduces investors’ willingness to take on risk.  The global crypto market valuation was trading at around $2.5 trillion, a 4.66% decrease over the last day. Bitcoin’s dominance settled at around 52.1%, an increase of 0.13% over the day. Data from Coinglass shows that 120,953 traders were liquidated because of the market collapse, totaling $394 million for the day. 

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Consequently, recent fundamentals highlighted Bitcoin exchange-traded funds (ETFs) reported a net outflow of $86 million at the same time as the dip, ending a four-day positive inflow streak. 

With a net inflow of $165.9 million, BlackRock’s ETF was the best-performing fund; Fidelity came in second with $44 million. 

Nevertheless, Grayscale’s GBTC reported $302 million in withdrawals, which offset the inflows and increased the total daily outflows for all the funds to $85.7 million. 

Memecoin is still quite high because of recent token launches like Book of Meme (BOME) and ‘Dogwifhat’ (WIF) based in Solana, as well as older meme coins like Pepe. One example is the recently introduced Base-native token DEGEN, which increased by an astounding 2,800% gain last month.

With multiple job statistics scheduled later this week, such as the unemployment rate and Friday’s nonfarm payrolls figure, Historical data highlighted that Bitcoin could likely stay volatile for a while. Furthermore, this month’s quadrennial mining reward halving for the Bitcoin blockchain is approaching. 

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ABOUT THE AUTHOR See More
Olumide Adesina
Olumide Adesina
Financial Market Writer
Olumide Adesina is a French-born Nigerian financial writer. He tracks, analyzes, and reports changes in financial markets with over 15 years of working experience in investment trading.
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