Crypto Market Dips Amid Rising Geopolitical Tensions
Wednesday, Oct 2, 2024 1:46 pm ET
The cryptocurrency market has witnessed a significant downturn in recent days, with escalating geopolitical tensions in the Middle East contributing to a $500 million liquidation of both long and short positions. As investors grow anxious about the performance of risk assets, they tend to flee from cryptocurrencies and flock to safe-haven assets like gold.
On October 2nd, the crypto market traded in the red as the total market capitalization fell by more than 5% to $2.25 trillion. Bitcoin [BTC] succumbed to bearish pressure and plunged to a seven-day low below $61,000. Most altcoins also wiped their recent gains, with Ethereum [ETH] dropping by 6.5% to trade at $2,473. Binance Coin [BNB] and Solana [SOL] were also down by 4.9% and 5.7%, respectively, while Ripple [XRP] fell below $0.60 after a 3.6% dip. Dogecoin [DOGE] recorded the most losses among the top ten largest cryptocurrencies by market capitalization, dropping by 9% to trade at $0.108.
Similar drops were also seen across traditional financial markets, with Japan's Nikkei 225 index falling by 2.5% according to Google Finance. Data from Coinglass shows that in the last 24 hours, more than $500 million was liquidated from the market, with $450 million of these being long positions. These liquidations impacted more than 155,000 traders. Bitcoin and Ethereum saw the highest liquidations of $140 million and $110 million, respectively. Per Coinglass, the largest single liquidation occurred on Binance, where one trader was liquidated for more than $12 million.
Crypto ETFs also experienced outflows on October 2nd. U.S. spot Bitcoin exchange-traded funds (ETFs) saw $242 million in outflows, the highest level since early September. Fidelity's Bitcoin ETFs saw the biggest outflow of $144 million. All other Bitcoin ETF products saw zero to negative flows apart from BlackRock. The iShares Bitcoin Trust ETF continued its positive streak, with $40M in inflows. Ethereum ETFs also came in negative with $48M in outflows, the highest level in more than a week.
As geopolitical tensions escalate, investors are reevaluating their risk exposure and seeking refuge in safe-haven assets. The crypto market's reaction to these tensions highlights the need for investors to diversify their portfolios and consider the impact of external factors on their investments.
On October 2nd, the crypto market traded in the red as the total market capitalization fell by more than 5% to $2.25 trillion. Bitcoin [BTC] succumbed to bearish pressure and plunged to a seven-day low below $61,000. Most altcoins also wiped their recent gains, with Ethereum [ETH] dropping by 6.5% to trade at $2,473. Binance Coin [BNB] and Solana [SOL] were also down by 4.9% and 5.7%, respectively, while Ripple [XRP] fell below $0.60 after a 3.6% dip. Dogecoin [DOGE] recorded the most losses among the top ten largest cryptocurrencies by market capitalization, dropping by 9% to trade at $0.108.
Similar drops were also seen across traditional financial markets, with Japan's Nikkei 225 index falling by 2.5% according to Google Finance. Data from Coinglass shows that in the last 24 hours, more than $500 million was liquidated from the market, with $450 million of these being long positions. These liquidations impacted more than 155,000 traders. Bitcoin and Ethereum saw the highest liquidations of $140 million and $110 million, respectively. Per Coinglass, the largest single liquidation occurred on Binance, where one trader was liquidated for more than $12 million.
Crypto ETFs also experienced outflows on October 2nd. U.S. spot Bitcoin exchange-traded funds (ETFs) saw $242 million in outflows, the highest level since early September. Fidelity's Bitcoin ETFs saw the biggest outflow of $144 million. All other Bitcoin ETF products saw zero to negative flows apart from BlackRock. The iShares Bitcoin Trust ETF continued its positive streak, with $40M in inflows. Ethereum ETFs also came in negative with $48M in outflows, the highest level in more than a week.
As geopolitical tensions escalate, investors are reevaluating their risk exposure and seeking refuge in safe-haven assets. The crypto market's reaction to these tensions highlights the need for investors to diversify their portfolios and consider the impact of external factors on their investments.