Key Takeaways:
- Cryptocurrency market capitalization fell from $4 trillion to $3.78 trillion in the past 24 hours.
- Galaxy Digital deposits BTC worth $1.18 billion to exchanges, suggests a sign to sell.
- SEC’s reversal on Bitwise ETF approval adds regulatory uncertainty to market sentiment.
The cryptocurrency market capitalization has dropped to $3.78 trillion from $4 trillion due to increased selling pressure. Bitcoin has dropped from $118,000 to $115,000, dragging down the majority of the big altcoins in the process.
Source: Trading view
More Than $500 Million Liquidated
Widespread liquidations have been brought on by the recent market decline. According to CoinGlass data, 143,120 traders were impacted by $515.49 million in positions that were closed in the past 24 hours at the time of reporting.
A BTC-USDT-SWAP worth $17.35 million on the OKX platform was the largest single liquidation order, demonstrating the magnitude of the move.
Greed Remains High
Retail sentiment is remarkably resilient, according to the Crypto Fear & Greed Index. At the time of reporting, the index is still hovering in the ‘Greed’ area at 66, despite a market-wide downturn that saw the overall crypto capitalization drop from $4 trillion to $3.78 trillion. This indicates that investor optimism is mostly unaffected by the recent volatility and is still much higher than the ‘Neutral’ score of 48 that was recorded only one month ago, even though it is a modest drop from last week’s reading of 71.
Smart Money Books Profit
A ‘Satoshi-era’ whale could be extracting enormous, institutional-grade profits, which could be responsible for the current decline in the price of BTC. Galaxy Digital, a digital assets investment firm, started depositing more than 10,000 BTC ($1.18 billion), which came from an OG whale on Thursday. This indicates that “smart money” could be making substantial profits at the current levels and is a part of a larger, ongoing liquidation of 80,000 BTC ($9.6 billion).
Furthermore, according to Lookonchain, Galaxy Digital removed 370M $USDT from OKX, Binance, and #Bybit in the last three hours and added 2,850 BTC ($330.44M) to exchanges, indicating that significant selloffs are likely to occur in the near future and that a price correction could continue.
ETF Approval Delayed
The SEC has unexpectedly blocked the Bitwise 10 Crypto Index Fund from converting into an ETF, despite earlier approval from its own Trading and Markets Division. The ETF would have included major altcoins like XRP, SOL, and DOT. Analyst Nate Geraci called the reversal “bizarre,” comparing it to a similar U-turn in the Grayscale Digital Large Cap ETF case.
Bloomberg analyst James Seyffart tweeted that the SEC’s decision arrived ahead of schedule, as the decision was expected to arrive next week.
Moreover, Adam Gana, an attorney at law firm Gana Weinstein, said this about the SEC decision-
“The public sees conflicting actions — approvals followed by sudden reversals — which creates confusion and undermines market confidence.
What’s Next
The latest decline in cryptocurrency markets seems to be more the result of profit-booking than anxiety. It is crucial to remember that the Crypto Fear and Greed index is a lagging indicator, even though it is still firmly in the “Greed” area.
Institutional participants such as Galaxy Digital could have possibly started to realize gains, indicating a tactical move following the current rise. Short-term volatility may continue as Galaxy Digital has deposited BTC worth over $330 million.
