Cryptocurrency market lost $ 500 million per day

Since Monday, May 12, the cryptocurrency market has experienced a sharp decline, which has led to large-scale liquidations. During the day, long positions worth more than $ 500 million were closed. The largest losses were recorded by such cryptocurrencies as Dogecoin DOGE $0.23 Binance-Peg Dogecoin -2.03% Market capitalization $0.58 billion VOL. 24 hours $0.45 billion and Cardano ADA $0.80 Cardano -2.09% Market capitalization $28.89 billion VOL. 24 hours $0.13 billion - each of them lost about 7% of its value, Coindesk reports.

Bitcoin BTC $103,788.88 Bitcoin 0.82% Market capitalization $2.06 trillion VOL. 24 hours $2.35 billion , which had previously shown steady growth, became the main factor in the market’s decline. Positions worth almost $ 200 million in bitcoin futures and another $ 170 million in instruments related to ethereum were liquidated. Solana SOL $173.27 Binance-Peg SOL -1.26% Market capitalization $0.19 billion VOL. 24 hours $0.73 billion , XRP XRP $2.54 XRP -0.68% Market capitalization $148.83 billion VOL. 24 hours $0.78 billion , and BNB $654.97 BNB -1.63% Market capitalization $95.55 billion VOL. 24 hours $0.27 billion also experienced a significant decline, ranging from 5−6%.

The fall of the top crypto assets was in contrast to the situation of the previous week, when there was a large-scale growth caused by short compressions. Back then, ethereum ETH $2,546.66 Bridged Ether (StarkGate) 1.86% Market capitalization $0.23 billion VOL. 24 hours $2.04 billion rose by almost 40%, and altcoins showed double-digit gains. These dynamics led to the closure of more than a billion dollars worth of short positions, the most since 2021.

One of the external factors that could have affected the market was the announcement of a reduction in trade tensions between the US and China. Although the stock markets reacted positively to the news, the cryptocurrency segment lost some of the investor enthusiasm that fueled the previous growth.

At the same time, open interest in the futures markets dropped significantly by more than $ 1.2 billion, indicating that traders were closing positions on a massive scale. Analysts warn that further market movements will depend on the June meeting of the US Federal Reserve, which could affect investment sentiment around the world.