BTC$84,6642.13%ETH$1,880.172.55%USDT$1.000.02%XRP$2.100.27%BNB$602.22-1.04%SOL$124.52-1.10%USDC$1.000.00%DOGE$0.171.77%ADA$0.670.92%TRX$0.240.34%STETH$1,878.192.48%WBTC$84,5331.88%TON$4.00-2.71%LINK$13.751.03%LEO$9.422.38%XLM$0.271.62%WSTETH$2,249.632.34%USDS$1.000.01%AVAX$19.251.33%SUI$2.360.55%SHIB$0.00001240-2.15%HBAR$0.171.74%LTC$83.09-0.71%DOT$4.110.84%OM$6.22-1.29%BCH$305.420.20%BGB$4.600.33%WETH$1,879.872.47%USDE$1.000.04%BSC-USD$1.000.00%BTC$84,6642.13%ETH$1,880.172.55%USDT$1.000.02%XRP$2.100.27%BNB$602.22-1.04%SOL$124.52-1.10%USDC$1.000.00%DOGE$0.171.77%ADA$0.670.92%TRX$0.240.34%STETH$1,878.192.48%WBTC$84,5331.88%TON$4.00-2.71%LINK$13.751.03%LEO$9.422.38%XLM$0.271.62%WSTETH$2,249.632.34%USDS$1.000.01%AVAX$19.251.33%SUI$2.360.55%SHIB$0.00001240-2.15%HBAR$0.171.74%LTC$83.09-0.71%DOT$4.110.84%OM$6.22-1.29%BCH$305.420.20%BGB$4.600.33%WETH$1,879.872.47%USDE$1.000.04%BSC-USD$1.000.00%

Advertisement

Crypto Market Rocked by Biggest Selloff in a Month

Bitcoin, Ethereum, XRP, and Solana plunged between 5% and 8%, with the total crypto market cap dropping 7.6% to $3.53 trillion.
By: Jona Jaupi • January 07, 2025
Crypto Market Rocked by Biggest Selloff in a Month

The cryptocurrency market suffered its largest drop in almost a month on Tuesday morning, with major assets like Bitcoin, Ethereum, XRP, and Solana posting losses amid heightened investor caution.

Bitcoin (BTC) fell 5.7% over the past 24 hours, trading at approximately $96,000. Ethereum (ETH) declined more sharply by 8.3% to $3,390. XRP also slipped by 6%, while Solana (SOL) decreased by 7% to $203. The total cryptocurrency market cap has dropped by 7.6% to $3.6 trillion, according to CoinGecko.

BTC Price chart
BTC Price

In the past 24 hours, 163,000 traders were liquidated, with total liquidations coming in at $507 million, according to CoinGlass. ETH accounted for around $110 million in liquidations, while BTC followed with $97 million. The largest single liquidation order, valued at around $18 million in ETHUSDT, occurred on Binance.

Analysts attribute the sell-off to several factors, including economic uncertainty, profit-taking by long-term holders, and concerns over potential regulatory changes in key markets.

“Today’s market losses highlight the current fragility of investor confidence amid ongoing economic uncertainty,” said Joao Reginatto, Chief Strategy Officer at M^0. “Fear of persistent inflation and higher interest rates are pushing capital away from risk assets, and crypto is no exception.”

This comes just a day after both crypto and equities reached fresh highs, Reginatto explained, adding that as liquidity remains relatively tight, the only certainty in the coming months appears to be continued market volatility.

Fed Impact

The market decline also comes ahead of the release of the Federal Open Market Committee (FOMC) meeting minutes tomorrow, which provide detailed insights into the Federal Reserve's discussions and are released three weeks after each meeting.

Three weeks ago, the Federal Reserve lowered its benchmark interest rate by 0.25 percentage points, setting it at a target range of 4.25%–4.5%, the lowest level since February 2023. While the rate cut aimed to stimulate the economy, the Fed also expressed caution about future reductions. This mixed message has unsettled markets, adding to the pressure on an already volatile cryptocurrency sector, experts said.

At the time, Joel Kruger, market strategist at LMAX Group, told The Defiant that the crypto market was already on edge, anticipating a possible correction after Bitcoin's record-breaking rally. “It wasn’t going to take much to at least rock the boat a little,” Kruger explained.

He added that the Fed’s decision served as a catalyst for market losses, amplifying the volatility. “The fallout from the Fed decision was too significant to ignore,” he said.

However, Kruger remained optimistic about the longer-term outlook. “In the end, we don’t believe such fallout will carry any meaningful impact on the medium and longer-term outlook, though short-term it makes sense to see the latest bout of selling,” he concluded.

Our articles are stored on Filecoin.

Advertisement

Get an edge in Crypto with our free daily newsletter

Know what matters in Crypto and Web3 with The Defiant Daily newsletter, Mon to Fri

90k+ Defiers informed every day. Unsubscribe anytime.