News
Why is the cryptocurrency market down today?
The cryptocurrency market, led by Bitcoin, started the week on a positive note as most cryptocurrencies recorded significant gains. However, it failed to continue the momentum by mid-week with several tokens trading in the red zone, experiencing major price corrections.
The highly volatile nature of the cryptocurrency market could lead to panic selling by investors, triggering further downward movement. Participants wondered why the cryptocurrency market is down today, just days before the expected halving of Bitcoin. Let’s take a look.
The global cryptocurrency market is losing momentum
CoinMarketCap, a cryptocurrency tracking platform, paints a clear picture of the nature of the cryptocurrency market today. According to its data, the capitalization of the global cryptocurrency market fell by 2.64% to $2.58 trillion in the last 24 hours. Furthermore, its trading volume fell to $90.21 billion, a decline of 7.81% over the past day.
Cryptocurrencies in the top 10 of the list, including Bitcoin (BTC), Ethereum (ETH), Solana (SOL), BNB and Dogecoin (DOGE), saw only a slight decline in prices over the observed period, however, trending tokens as Dogwifhat (WIF) and Wormhole (W) have recorded massive losses of 15% and 14% respectively in the last 24 hours. As a result, the global memecoin market capitalization fell by 5% to $59.8 billion.
Source: CoinMarketCap
Likewise, the Solana Ecosystem’s market capitalization and trading volume have now declined by 2.25% and 3.52%, respectively. Stablecoins were also affected by the overall decline of the cryptocurrency market, as their market capitalization fell by 0.01% and their trading volume fell by 0.67%.
The factors influencing the cryptocurrency market decrease today
Besides the fact that the cryptocurrency market is naturally volatile, several factors could be attributed to today’s decline.
Pre-halving correction
As Bitcoin’s halving approached, the market was faced with mixed reactions. The Bitcoin halving is an event that occurs every four years, halving the reward for miners. This helps reduce the amount of new BTC in circulation as production decreases. Several expert analysts have predicted a price correction ahead of the April 18 event. This could continue until after the halving, when the price of BTC is expected to skyrocket above $80,000.
General market sentiment
Market sentiment refers to the emotions of investors in the crypto community. Measured on a scale of 1 to 100 by the Cryptocurrency Fear and Greed Index, the metric has jumped from 80 to 78 over the past 24 hours. While the change isn’t very significant, it still highlights a shift in investor emotions.
In the cryptocurrency market, this indicates increased selling pressure as investors choose to sell their holdings rather than buy or hold them.
Liquidation of cryptocurrencies
According to Coinglass statistics, around 99,403 cryptocurrency traders fell victim to liquidity over the past day. Bybit alone accounts for $8.38 million in settlements out of the $274.74 million in overall settlement data. This liquidation mainly affected major cryptocurrencies such as Solana (SOL), Ethereum (ETH), and Bitcoin (BTC).
In conclusion, the cryptocurrency market decline seen today, April 10, is mainly caused by factors including market sentiment, cryptocurrency liquidation, and pre-halving correction. Hopefully the market will recover as we approach the highly anticipated BTC halving.