The crypto market is on a free fall today and top coins are treading dangerous monthly lows. Bitcoin fell below the $25,000 mark today for the first time since December 2020 sparking a domino effect of sell-offs. Several financial analysts had been ringing the warning bells of a crash and the fall is now unfolding right before our eyes.
The global crypto market cap dramatically fell to $1 trillion today from hovering at about $1.10 trillion yesterday. The point to be noted is that the global crypto market cap had touched $3 trillion in early 2020. The overall crypto market cap saw a sharp decline this year and fears loom that it could head further south.
Read More: Celsius moved $320m to FTX before halting user withdrawals, transfers
Here’s Why Bitcoin & The Crypto Market is Crashing Today
- Celsius Plunges 70%
Celsius Network today (CEL) plunged 70% today sending fears that it could be the next crypto to fall to $0 in similar TerraUST and Luna fashion. The TerraUST and Luna crash had adversely affected Bitcoin making it fall 8 to 10% last month. Similarly, the Celsius token crash has affected Bitcoin’s prospects making it fall another 8 to 10% today.
The crypto market is a closely connected network and if one token sees a dramatic fall, it affects the entire financial system. The Celsius crash is just the tip of the iceberg.
Today’s crash was a cocktail in brewing as investors are selling off their holdings than buying them. The risk-apatite among investors has seen a sharp decline and buying pressure has reduced dramatically. Even top crypto exchanges are facing the heat as transactions across the space have declined. Leading crypto exchanges such as Coinbase, Rain Financials, and many others have fired employees and also paused new hiring.
Read More: Nexo preps for Celsius buyout; Offer stands till 20 June
- Inflation Rate Spikes to 8.6%
The U.S inflation rate jumped to 8.6 this month, the highest ever in 40-years. The food index rose 1.2%, the home index spiked 1.4% and the energy index rose 0.4%. In short, all necessities are shooting up and are affecting the day-to-day functioning of the economy.
After the new inflation rates were released, Dow Jones & Nasdaq fell nearly 400 and 800 points and the stock market experience a ‘sea of red’. The crypto market dipped hours after the inflation rates were announced and fell further during the weekend due to massive sell-offs. Also, $200 million worth of Bitcoin shorts has been liquidated in the past 24-hours adding to the market crash chaos.