Crypto market crashes as BTC comes under selling pressure

Hola folks!

The crypto market traded under increased uncertainty, with Bitcoin dipping below the $55k mark over the weekend. The overall crypto market cap also took a hit, with altcoins witnessing price corrections. 

The US and German governments' offloading cryptos and the commencement of the Mt. Gox liquidation are the probable reasons behind the crypto market fall. Let’s dig in to read about the major developments in the crypto market and how they can potentially impact the prices in the week ahead.

Crypto markets took a heavy beating last week as BTC crashed more than 12% on the news of Mt. Gox transferring more than 47,000 BTC to the hot wallets of exchange as the repayments of the now-defunct exchange began. BTC is now trading below the 200-day moving average, just above the $55k level, which is a bearish sign for the world’s largest cryptocurrency.

However, Bitcoin ETFs still saw a net influx of funds in the last week overall even as markets dropped, suggesting that investors are buying the dip. Even the much anticipated upcoming ETH spot ETF-related positive developments couldn't lift the prices for ETH, which crashed more than 16% in the last 7 days, breaking the important $3k level. 

Overall, the broader crypto markets also felt the heat and were a sea of red with most tokens having double-digit percentage falls, resulting in the total market cap falling by more than $200bn, trading just above the $2.1trn mark. More than 675 million dollars of liquidations happened in the 24 hours after the initial Mt.Gox wallet movements, as per data on Coinglass.

Even as the markets continued to tank, there were positive long-term developments on the regulatory front. Stablecoin issuer Circle got the first stable coin issuance license in the European Union under MiCA’s new crypto rules. This secure electronic money issuance license will allow them to mint EURC and USDC in the EU. Another one of the biggest stablecoin issuers, Paxos also gained approval from Singapore for stablecoin issuance with the Digital Bank of Singapore, DBS providing custody. 

In the broader altcoin universe, it was a sea of red as most tokens sunk in price. Major losers of the last week include Ethena’s ENA and popular memecoins like PEPE, BRETT, and WIF with a massive 20% downslide in these tokens in the past week. 

Telegram's Notcoin or NOT token, did however manage to stage a comeback over the weekend and reversed its downward slide to end the week in green. 

PENDLE was also among the top losers for the week as it has lost more than 50% in its TVL because investors seem to be moving away from the narrative of airdrop farming for Liquid restaking protocols. 

The overall Defi TVL also took a plunge with the total value locked in DeFi protocols has come down to 83 billion dollars from the local top of 107 billion dollars a week ago. 

In the AI category, one of the largest tokens, Bittensor’s TAO also took a beating as the TAO blockchain had to be paused for some time to contain a more than $8 million worth wallet drain attack.

Worth highlighting was that Solana’s pump.fun overtook Ethereum in daily revenue for a day as early this week as the single-day revenue of pump.fun stood at $2 million, while ETH’s revenue was $1.9 million during the same time. Another silver lining from the broader markets is the increasing popularity of the prediction market, PolyMarket, which continues to gain mainstream adoption with increased transaction activity.

• BTC $57,403 ⏬ 8.66%

• PEPE $0.000008994 ⏬ 22.59%

• NOT $0.01691 ⏫ 18.61%

• SOL $139.32 ⏬ 5.60%

(All data here is as of 3.23 p.m., 8 July 2024)

Before we conclude, here’s a quick look at some important news from around the crypto world.

• Crypto crash pushes Fear & Greed Index to lowest since 2023. Crypto investor sentiment cratered to the most negative levels since the tail-end of the 2022 crypto winter as bitcoin’s (BTC) plunge below $54,000 pulled down digital asset markets. Read more here. 

• Mt. Gox said on Friday that it started making repayments to customers, ending a nearly 10-year wait for some users to get their crypto back after a 2014 hack sent the crypto exchange into bankruptcy. Read more here. 

That’s it for now. Thanks for sticking around.

See you later, folks! 👋

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