Why Is the Crypto Market Down Today?

The crypto market has not been on a good course in the last 24 hours, with altcoins suffering heavily. The lack of hype and slow price action in Bitcoin could be some of the primary reasons.

Spot ETF approvals, halving and other possible catalysts are now behind us and it looks like traders are missing those in order to start investing more.

BTC price is also nothing short of boring right now, losing $66k yesterday as well, after plunging slowly from the $70k area.

Top coins have almost dropped by up to 10% during this period. The surge in Bitcoin’s and Ethereum’s prices following the approval of Spot ETFs has seemingly cooled down, contributing to the overall market decline.

ETFs Decrease Bitcoin Holdings

According to a recent update by Lookonchain, nine ETFs have collectively decreased their Bitcoin holdings by 3,169 BTC, equivalent to approximately $208 million.

Notably, Fidelity has reduced its Bitcoin holdings by 1,224 BTC ($80.34 million) and now holds 171,529 BTC, worth around $11.25 billion. Similarly, Grayscale has decreased its Bitcoin holdings by 936 BTC ($61.4 million) and currently holds 281,212 BTC, valued at approximately $18.45 billion.

The substantial reduction in Bitcoin holdings by these major ETFs has likely contributed to the current market downturn, as institutional investors often play a major role in driving market sentiment and price action.

Altcoin Market Faces Brutal Decline

The recent bloodbath saw Solana dip below the $140 level. Ethereum fell below $3,450 while meme coins, including Shiba Inu dropped below the $0.00002 level.

The altcoin market has been hit particularly hard by the recent downturn, with mid-cap and low-cap coins plummeting back to their previous bear market lows.

Despite the brutal scene in the altcoin market, savvy analysts are spotting opportunities amidst the chaos. According to Anup Dhungana, the Others.D index, which tracks the performance of altcoins excluding the top 10, is on the verge of retesting a crucial support trendline that marked the bull cycle bottom for altcoins.

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This support trendline has historically served as a key level for the altcoin market, and a successful retest could potentially signal a reversal in the current downtrend. Technically, analysts expect a bounce to occur sooner rather than later from this critical support level.

While the current market conditions may seem grim, experienced investors and analysts are viewing this downturn as an opportunity to accumulate promising altcoins at discounted prices.  

Read more: Shiba Inu Meme Coin Poised for Potential 30% Rally, AI Predicts SHIB Price

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Vignesh Karunanidhi
Vignesh Karunanidhi

Seasoned crypto writer with deep passion for blockchain and cryptocurrency