Long

Cryptocurrency

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Bitcoin and the cryptocurrency market has experienced its most significant single-day decline in market capitalization since January 2022. Over the past 24 hours, the market has seen a substantial downturn, sending ripples through the digital currency ecosystem.&nbsp; 
<h2 id="b-bitcoin-perpetual-future-funding-rate-turned-negative-b">Bitcoin Perpetual Future Funding Rate Turned Negative&nbsp;</h2> 
According to <a href="https://www.coingecko.com/">Coingecko data</a>, this sharp drop has alarmed investors and analysts, sparking concerns about the market’s immediate future and stability. The cryptocurrency market capitalization has plummeted to $1.88 trillion, a 17% decrease in the last 24 hours. CoinGlass <a href="https://www.coinglass.com/LiquidationData">data </a>also revealed that about 298,702 traders were liquidated over the past 24 hours. 
One of the notable indicators of this bearish sentiment is the Bitcoin perpetual futures funding rate, which has turned negative within the same 24-hour period. <a href="https://thecoinrise.com/bitcoin-price-fall-triggers-significant-liquidation/">Over $362 million of Bitcoin was liquidated</a> over the past 24 hours. Out of the $362 million, $302 million were long positions. According to <a href="https://coinmarketcap.com/currencies/bitcoin/">CoinMarketCap,</a> Bitcoin dropped 7.3% to $54,781.24, over the past 24 hours.&nbsp;&nbsp; 
<h2 id="b-long-ethereum-contracts-also-faced-liquidation-b">Long Ethereum Contracts Also Faced Liquidation</h2> 
This shift in the funding rate suggests that market participants are predominantly taking short positions on Bitcoin. However, the decline in the cryptocurrency market is not isolated to Bitcoin alone. Ethereum (ETH), the second largest cryptocurrency, also faced substantial liquidations. According to data, roughly $346 million was liquidated, of which $297 million were long positions. Ether’s price fell 13% in the last 24 hours to $2,474.36,<a href="https://coinmarketcap.com/currencies/ethereum/"> as of the time of writing</a>. 
This dual impact highlights the interconnected nature of cryptocurrency markets, where a significant movement in one major asset can quickly influence others. Investors who had taken long positions, betting on the continued rise of Bitcoin and Ethereum prices, found themselves on the losing side of these trades as the market shifted. 
The liquidations were mainly focused on three primary assets, impacting lending protocols. Ether collateral bore the impact of the liquidations, reaching $216 million within 24 hours. Wrapped staked ether came next with liquidations amounting to $97 million, and significant liquidations totaling $35 million were also observed with wrapped bitcoin. 
<h2 id="b-south-korea-s-new-crypto-law-causes-decline-b">South Korea’s New Crypto Law Causes Decline</h2> 
Just last month, South Korea’s<a href="https://thecoinrise.com/south-koreas-new-crypto-law-causes-major-decline-in-trading-volumes-across-exchanges/"> new crypto laws caused a significant decline in trading volumes</a> across various exchanges. According to CoinGecko reports, Upbit’s trading volume dropped by 29.4%, reaching $1.50 billion. This dramatic drop emphasizes how the market responded to the new regulatory environment. 
Also, one of the first and well-known crypto exchanges in South Korea, Bithumb saw a significant drop in its trading volume. As reported in July, it posted a 24.7% decline, which reduced its trading volume to $425.22 million. Coinone, among the main exchanges, suffered the most, as its trading volume fell by 38.4% to $23.36 million. 
The post <a href="https://thecoinrise.com/bitcoin-drives-crypto-market-caps-biggest-drop-in-2-years/">Cryptocurrency Market Cap Prints Biggest Drop In 2 Years</a> appeared first on <a href="https://thecoinrise.com">TheCoinrise.com</a>.

Cryptocurrency Market Cap Prints Biggest Drop In 2 Years

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