The cryptocurrency market experienced a significant downturn on Wednesday, with Bitcoin leading the decline by losing $7,000 in value within 24 hours. The world’s largest cryptocurrency dropped below $97,000 after approaching $102,000 earlier, as retail investors cashed in on recent gains.
Other major digital assets, including Ethereum, XRP, Solana, and BNB, mirrored the downturn, contributing to a broader market selloff. Ethereum, the second-largest cryptocurrency by market value, fell 8.1% to $3,381, while XRP shed 6.3%, Solana dropped 7%, and BNB declined 6.2%. Meme coins like Dogecoin and Cardano were not spared, losing 9.7% and 9.4%, respectively.
Global Market Metrics
According to data from CoinMarketCap, the global cryptocurrency market capitalisation shrank by 6.28% over the past day, falling to $3.35 trillion. The total trading volume surged to $183.72 billion, marking a 46.94% increase, as investors rushed to reposition their portfolios amid heightened market volatility.
Decentralised Finance (DeFi) trading accounted for $11.63 billion, or 6.33% of the total 24-hour trading volume, while stablecoins dominated with a volume of $171.63 billion, representing 93.42% of the total market trades.
Broader Financial Market Impact
The selloff in the crypto market coincided with declines in traditional financial markets. The CoinDesk Market Index, which tracks 124 digital assets, slumped 6.6% in 24 hours. Meanwhile, US stock indices followed suit, with the Nasdaq 100 dropping 2%, the S&P 500 shedding 1.2%, and the Dow Jones Industrial Average falling 0.6%.
In the bond market, the US 10-year Treasury yield rose to 4.683% from 4.616% the previous day, signalling caution among investors. The five-year yield also climbed to 4.465%, up from Monday’s 4.421.
