The crypto market weakened again. Bitcoin saw its prices falling beneath $30K following an impressive move past $31K during the previous session. The world’s largest crypto by market value lost over 4% to trade at $29,370.
Bitcoin has hovered within the $30K mark for several weeks, resisting forecasts of further drops while struggling to accumulate upside momentum as the U.S market took a hit. BTC has dropped more than 35% in 2022, staying far away from the $69K record peak recorded in November last year.
The altcoin market saw substantial declines following BTC’s latest leg down. The second-largest crypto, Ethereum, lost nearly 7% to explore the $1,782 mark. Meanwhile, Shiba Inu and Dogecoin lost 6% each to $0.000010 and $0.07. Also, the global crypto market capitalization declined by 5.06% within the previous day to $1.21 trillion.
Other large-cap cryptos also plunged, with Cardano, Chainlink, Luna Classic, Polygon, Avalanche, Polkadot, Solana, Tether, Tron, Litecoin, XRP, Uniswap, and Stellar hovering with 24hr losses.
Stablecoins are encountering regulation globally after the Terra ecosystem crash in May, which saw investors losing confidence in the market. CoinGecko data shows the stablecoin UST trading near $0.16, exploring massive downsides since losing its dollar peg.
Japan introduced a legal framework for stablecoins (on Friday) because of UST’s debacle. The new law suggests stablecoins should have a yen or any legal tender peg & assure investors can redeem the stablecoins at face value.
Total AUM (asset under management) in crypto investment products declined by 28.6% to $34.2 billion by May 26 as most cryptos endured massive losses (data from CryptoCompare).
Why did Bitcoin plunge overnight? Mudrex co-founder Edu Patel believes Bitcoin’s drop below $30K within the past 24hrs came as BTC miners liquidated their assets as the crypto extended declines since mid-May.
He trusts that $31K remains a challenge for the bellwether crypto. BTC has hovered inside a restricted range at $29K – $31K and might stay within the region for more days. Market players should not ignore potential declines by BTC.
Kuna Jagdale of BitsAir Exchange believes BTC will unlikely dive further, maintaining range-bound actions. Jagdale added that volatility fades as the fear & greed index ticks higher.
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