Crypto Market Faces Shock as $230 Billion Disappears Overnight
The crypto market has experienced a sudden downturn, with a significant drop in investor sentiment and a substantial loss in market value.
The crypto market’s Fear & Greed Index sharply declined to 28, indicating a strong sense of fear among investors. This shift comes as the market underwent a significant sell-off, resulting in a staggering loss of over $230 billion in one day.
On Friday, CoinMarketCap reported a low point for the Fear & Greed Index, nearing extreme fear levels not seen since April. The total crypto market capitalization fell to around $3.54 trillion, reflecting a 6% decline from $3.78 trillion the day before.
Crypto Fear & Greed Index chart. Source: CoinMarketCap
Major Cryptocurrencies Continue Downward Trend
Data reveals that leading cryptocurrencies extended their downward trajectory within the last 24 hours. Bitcoin (BTC) dropped nearly 6% to approximately $105,000, while Ether (ETH) recorded an almost 8% decline to around $3,700. Other major assets like BNB, Chainlink, and Cardano faced similar drops ranging from 9% to 12%.
Furthermore, other crypto assets, including Solana and XRP, experienced declines exceeding 7%, contributing to a week-long downturn that saw substantial previous gains evaporate.
Crypto market cap and volume. Source: CoinMarketCap
Despite last week’s crash resulting in nearly $20 billion liquidations, this week’s activity proved far less intense, with about $556 million in leveraged positions eliminated across exchanges. This amount represented a small fraction compared to the previous week’s figures, highlighting a significant reduction in market volatility.
Market Reactions Among Various Assets
The recent downturn also adversely affected memecoins, NFTs, and ETFs. Memecoins saw a 33% drop within 24 hours, even as they had begun to recover earlier. The NFT sector, previously rebounding from a significant loss, fell back below a $5 billion valuation—a level not seen since July, demonstrating the widespread impact of market sentiment.
Spot Bitcoin ETFs recorded outflows exceeding $536 million amid this crash, while Ether ETFs noted net outflows over $56 million. The spillage of capital from these funds further reflected the overall nervousness pervading the market.
