- The cryptocurrency market cap is down by almost 3.24% indicating a correction after a rally.
- Bitcoin witnessed less volatility compared to other cryptocurrencies.
The digital assets market was under pressure today as investors observed a broad-based decline in the prices of major cryptocurrencies. The overall market capitalization fell by 3.24% currently stands at $3.8 trillion, which indicates a significant change in the mood of the market. Bitcoin was relatively stable as altcoins showed a stronger selling pressure during the trading session.
Broad-Based Decline is Caused by Market Dynamics
As per CMC data, the crypto market cap fell below 3.24% as key tokens moved away to new highs. Bitcoin was in a tight range around the price of $117,538 with little volatility compared to other cryptocurrencies. Ethereum dropped by about 4.15% to the current prices of about $3,542 due to the general uncertainty in the market by both institutional and retail investors.
XRP had a bad day, losing more than 13% in the last 24 hours as regulatory issues continued to haunt investor sentiment. Solana dropped by over 9.72% to around $181.14, and meme coins such as Dogecoin corrected by more than 14%. The pervasiveness of the current decline implies systematic rather than asset-specific factors that are behind market behaviour.
The derivatives markets were important in speeding up the correction, with more than $634 billion of the open interest washed out in a single trading day. This 11% drop in futures and options positions added more selling pressure in the spot markets. The deleveraging of positions increased the volatility of prices, especially on altcoins with less liquidity characteristics.
The market share of Bitcoin did not fluctuate much and was at 61.6%, thus not allowing the capital to rotate into other assets. Altcoin Season Index stood at 31/100, which means that the market is not in a real altcoin bull phase yet. This indicator must have readings of more than 75 to indicate long-term altcoin superiority over Bitcoin.
In the recent trading sessions, BTC reached an intraday high of $119,290 and a low of $117,391, which shows that the asset remains volatile within the set ranges. Analysts believe that the present price movement is a healthy consolidation after a long bullish run and not the start of a large correction.
The market players consider the current drop as a normal correction that opens long-term investing prospects. The adjustment follows several weeks of good performances, with most tokens hitting multi-month highs only to fall back. Trading volumes were also high, which means that there were a lot of people involved in the trading even though the price action of most major cryptocurrencies was negative.
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