On Sunday, the value of the cryptocurrency market crashed as investors kept pulling out of riskier investments.
The total value of cryptocurrencies fell by over $270 billion during the last day, driven primarily by an 11% decline in bitcoin and a 21% decline in ether, according to CoinGecko data.
The crypto market selloff was accompanied by a more general decline in Asian-Pacific equity markets. Following the announcement last week that the Bank of Japan would raise its benchmark interest rate to the highest level in 16 years, the Nikkei 225 in Japan saw a 7% decline, compounding losses.
This past week saw the Nasdaq plunge 3.4% into correction territory in the United States, ending the tech-heavy index’s worst three-week run since September 2022, when the market was plunging. Nvidia and Amazon were involved in the decrease.
The decline in the manufacturing sector, increased unemployment, a weaker-than-expected jobs report, and dismal earnings all contributed to last week’s stock market meltdown. The U.S. Federal Reserve decided against cutting its benchmark rate in September, which many market observers had factored into their projections. Better performance for riskier assets is typically correlated with lower interest rates.
The price of bitcoin has dropped to its lowest point since February. At almost $54,000, the largest cryptocurrency in the world is trading. It has still increased by about 23% this year.
Ether, the native token that powers the Ethereum network, lost all of its annual gains and is now trading at about $2,300. The price of Solana has dropped by 10%, and Binance’s BNB cryptocurrency has dropped by more than 15%.
This week, investors will also be watching central banks in Australia and India, as well as fresh trade data from China and Taiwan.
A wider range of investors will be affected by the most recent cryptocurrency meltdown, as the SEC this year approved new spot exchange-traded funds for bitcoin and ether. Hundreds of millions of dollars have been invested in the coins by the ETFs. It was announced on Friday by CNBC that Morgan Stanley will soon permit its 15,000 financial advisors to introduce bitcoin ETFs to its clientele, a first for the Wall Street industry.
