The crypto market experiences a downturn, witnessing a $100 million liquidation over 24 hours. This decline is attributed to factors such as profit-booking, uncertainty in the market outlook, and the impact of the Spot Bitcoin ETF.
Amid a crypto market selloff on January 22, the cryptocurrency market witnessed a significant downturn, resulting in over $100 million in liquidations within the last 24 hours. The decline is primarily fueled by diminishing investor risk appetite, marked by profit-booking strategies. Speculations surrounding future market performance and the lingering impact of the recently approved Spot Bitcoin ETF have added an additional layer of volatility to the situation.
Crypto Market Witnesses $107.25M Liquidation in 24 Hours
In the past 24 hours, the crypto market experienced an unprecedented liquidation of $107.25 million, impacting approximately 55,000 traders, according to CoinGlass data. The largest single liquidation, valued at $3.20 million, took place on OKX – ETH-USD-SWAP. Ethereum led individual crypto liquidations with $22.94 million, closely followed by Bitcoin at $20.75 million, and Solana at $6.53 million.
Examining crypto exchanges, Binance ranked highest in liquidation with $52.62 million, followed by OKX at $34.19 million, and Bybit with $12.06 million. Despite this market turmoil, Bitcoin futures Open Interest data indicates a 1.81% surge in total BTC Futures open interest over the last 24 hours.
In contrast, BTC Open Interest on the CME exchange decreased by 1.66% to $4.69 billion or $114.49K BTC. Simultaneously, Bybit saw a 1.05% dip in Bitcoin Open Interest to 76.49K BTC or $3.14 billion.
Market Dip: Profit-Booking, Economic Indicators, Awaiting Fed Insights
The recent dip in the crypto market is attributed to profit-booking opportunities and traders cautiously assessing market conditions, particularly in anticipation of the release of Q4 preliminary U.S. GDP Data and PCE inflation data this week. These data points are deemed crucial for illuminating the current state of the U.S. economy, potentially influencing the Federal Reserve’s stance. The market is eagerly awaiting the Fed’s gathering next week, which is expected to provide insights into the potential future stance of the Federal Reserve.
Concurrently, ongoing legal challenges in the crypto space, particularly the SEC’s actions against major platforms like Binance and Coinbase, contribute to investor concerns. The outcomes of these legal proceedings, coupled with macroeconomic factors such as the forthcoming Fed meeting, are eagerly anticipated. Investors are hopeful for insights into the Federal Reserve’s future moves based on these critical developments.
Crypto Market Slumps 3.16%: Bitcoin, Ethereum, Altcoins Decline
As of the latest update, the global cryptocurrency market experienced a significant downturn, recording a 3.16% slump to reach $1.59 trillion. Concurrently, the overall trading volume surged by 34.50%, reaching $42.49 billion. Prominent cryptocurrencies, including Bitcoin, Ethereum, Solana, BNB, XRP, and others, faced notable declines over the past 24 hours.
Bitcoin’s price took a hit, plunging by 2.63% and settling at $40,677.05 at the time of writing on Monday. Ethereum also witnessed a 4% dip, reaching $2,380.04, while BNB’s price slumped by 2.03% to $312.66.
Notable altcoins also saw substantial declines, with Solana experiencing a significant slump of 6.29% to $87.71, and XRP falling approximately 4.5% to $0.5294. Cardano, despite recent traction, faced a 5.42% decline, reaching $0.4913.
The recent market downturn is linked to Grayscale’s sale of Bitcoins, adding to the selling pressure after the GBTC share sale. The move by Grayscale has intensified market pressures and contributed to the overall decline.
Crypto Market Trends Amid Grayscale Bitcoin Trust Liquidation Predicted
Crypto analyst Chris J Terry anticipates a sustained flat or downward trend in the crypto market until the completion of Grayscale Bitcoin Trust’s (GBTC) estimated $25 billion liquidation. Terry criticizes Grayscale’s decision to maintain ETF fees at 1.5%, foreseeing potential repercussions for the broader market.
Contrary to this perspective, Grayscale CEO Michael Sonnenshein disputes the idea that high GBTC fees are driving significant liquidations. Meanwhile, Galaxy Digital CEO Mike Novogratz acknowledges potential selling activity in GBTC but predicts investors will transition to other ETFs, particularly endorsing $BTCO.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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