The cryptocurrency market is facing escalating losses after experiencing its second-worst weekly decline in 2024.
PLATFORM TIMES gathered that the downturn is largely driven by reduced demand for Bitcoin exchange-traded funds (ETFs), uncertainties surrounding the U.S. Federal Reserve’s monetary policy, and a weakened appetite for digital assets.
The market’s plunge marks the steepest decline since April.
Bitcoin’s price plummeted by nearly 5%, settling at $61,000, a value below its one-month low.
This sharp decline follows a six-day streak of withdrawals from U.S. ETFs focused on the digital asset, which has significantly impacted Bitcoin, the top token by market value.
In the past 24 hours, 90,987 traders were liquidated, culminating in a total liquidation value of $283.23 million.
The crypto market’s woes are compounded by skepticism about the Federal Reserve’s ability to promptly lower interest rates, which are currently at a two-decade peak.
Major cryptocurrencies like Ether and Solana have also seen notable declines, marking their longest weekly falls since last year and 2022, respectively.
The global cryptocurrency market valuation stands at $2.24 trillion, reflecting a 4.54% drop over the last day. Bitcoin’s dominance has decreased slightly to 53.85% amidst substantial sell-offs in the altcoin market.
Ethereum, currently priced at $3,312, has fallen approximately 5% from the previous day and 8% over the past week, despite reports of significant long-term holder accumulation during the price drop.
Data from Farside indicates that Bitcoin-tracking ETFs have experienced a series of withdrawals over the past six trading days.
Notably, June 13 saw outflows of $226.2 million, the highest among these days. This trend persists even as fund managers prepare to launch the first U.S. ETFs that invest directly in Ether, the second-largest cryptocurrency.
Meanwhile, Solana has gained favor among several hedge funds specializing in digital assets.
Bitcoin reached a record high of $73,798 in March, yet traditional assets such as gold, bonds, and stocks have outperformed it this quarter.
Analysts are closely watching the 200-day moving average, currently at $57,500, as a potential support level.
Other major cryptocurrencies, including Polkadot (DOT), Solana (SOL), and Ripple (XRP), are also reporting daily decreases ranging from 5% to 12%, indicating a broader downturn in the altcoin market.
Shiba Inu, one of the prominent meme coins, has dropped around 9% in the last 24 hours and nearly 20% over the past week, highlighting its volatility.
Additionally, Bitcoin whale transactions have slowed down significantly just before the cryptocurrency’s price fell below $61,000.
According to data from Santiment, there were 9,923 Bitcoin whale transactions (those worth more than $100,000) over the previous two days on June 23, a 42% decline from the 17,091 transactions reported in the preceding two days.
Earlier this year, traders were optimistic about digital assets, expecting a dovish shift from the Federal Reserve as inflation eased and anticipating a potential political change in Washington that could signal a more favourable stance from U.S. regulators.
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