The crypto market cap has continued to plummet and now stands at $1.04 trillion, down over 8% in the last 24 hours. Almost every major cryptocurrency has been in the red, with prices for many falling more than 11% to set new lows in the past 24 hours.
The dominance of the top currencies has declined by almost 0.5 percent to 47.20 percent of the total crypto market. Bitcoin’s price has fallen a staggering 17.02% over the past week.
At the time of writing, Ethereum is trading around $1350, down more than 14 months. Solana is down nearly 30% and hovering around the $29 level.
According to experts, the fall in the price of the cryptocurrency indicates that investors are less willing to take risks. They are very wary of risky investments. It is one of the most volatile investments due to its unpredictability and volatility.
Meanwhile, the total forex market cap rose 31.35 percent to $94.56 billion over the past 24 hours, underscoring the significant sell-off of digital assets by investors. DeFi’s market share volume in crypto was $7.76 billion, 8.2% of the total crypto trading volume. The stablecoins market was worth $82.21 billion, 86.94% of the total 24-hour turnover of the entire cryptocurrency market.
Why the crypto market falls
Bitcoin is trading at $25,762.63 at the time of writing, down from its all-time high of nearly $68,000. Central bank interest rates have been raised, causing cryptocurrency trading to slow down and their values to fall. Consider this: Bitcoin’s year-to-date return is down 40%, while Ethereum’s is down 50%.
Here’s what experts have to say about the cause of the market decline
“The crypto market has been pressured by the Federal Reserve and has hiked interest rates in recent months to fight inflation. Bitcoin, Ethereum and most currencies suffered losses over the weekend after a broad selloff after data showed US inflation hit a 40-year high,” said Edul Patel, co-founder and CEO of crypto investment platform Murex.
Amit Gupta, Founder and CEO of Fintrekk Capital believes that the downfall of the cryptocurrency markets is a global event. “The decline in cryptocurrencies is a global event. Central bank rate hikes and the rise in the dollar index have led to reduced trading activity and price falls. Volumes have fallen and traders (speculators) are posting losses.”
Gupta continued, “Coinbase, a cryptocurrency exchange facility in the United States, released financial results for the first quarter showing a significant decline in retail cryptocurrency trading, although institutional trading figures have remained relatively flat.”
Could Bitcoin hit $100,000 in 2022?
Bitcoin has had a rocky start to the year, but experts still believe it will hit $100,000 — and it’s more a matter of when than if.
Investors are worried about rising inflation, geopolitical tensions and the prospect of tighter monetary policy from the Federal Reserve. The crypto market has become increasingly correlated with the stock market in recent months, making it even more dependent on global economic conditions.
With no end in sight, war, inflation and volatile monetary policy in the United States will continue to fuel volatility in the coming weeks and months, they warn.
Bitcoin has only briefly surged above $45,000 in the last six months and has not surpassed $50,000 since December 25, 2021. Bitcoin’s current price is a far cry from its all-time high above $68,000 set in November. Despite the recent price drop, bitcoin is still much more valuable than it was just a few years ago. This kind of ebb and flow is nothing new for Bitcoin.
Despite the volatility and recent price drop, many experts still believe Bitcoin will hit $100,000 soon, albeit with differing estimates of when that will happen. According to a recent study by Deutsche Bank, about a quarter of Bitcoin investors expect Bitcoin prices to top $110,000 in five years.
Is the crypto market crashing?
According to experts, the drop in prices indicates that investors are less willing to take risks. They seem very concerned about risky assets. It is one of the most volatile assets due to its uncertainties and fluctuations.
Liquidations have been high since Friday, possibly due to investor panic. Bitcoin and Ethereum are each down about 7% and are now valued at $25,000 and $1,300, respectively. The bearish trend could continue in the coming days.
Although Bitcoin has a long history of underperforming, altcoins now face additional challenges due to the potential for regulatory roadblocks. According to a CoinDesk analysis, only a tiny number of altcoins will survive such market swings.
Soaring food, gas and energy prices are weighing on the bitcoin market, according to BuyUcoin CEO Shivam Thakral.