Crypto Market Plummets 10% as Binance Faces Regulatory Scrutiny

In the last 24 hours, the cryptocurrency market experienced a significant downturn, with regulatory actions against major exchange Binance triggering widespread fear and liquidations. The Nigerian government's allegations that Binance facilitated money laundering sent shockwaves through the market, leading to substantial selloffs and increased volatility. As a result, over $253 million in long positions were liquidated across derivatives markets within that 24-hour period.

Several top tokens, including KAITO, EIGEN, IP, and the TRUMP meme coin, saw declines of more than 10%, contributing to the broader market decline. The total crypto market capitalization fell towards $2.95 trillion, reflecting a shift towards risk-off sentiment among investors. Bitcoin dominance climbed to nearly 58% as investors sought relative safety in the established crypto asset amid the volatile conditions. The market’s cautious mood was also captured by the Crypto Fear & Greed Index, which indicated “Fear” as the prevailing emotion among participants.

Despite the market turmoil, other developments continued across the crypto landscape. Blockchain project Sei Network is reportedly exploring a potential acquisition of consumer genomics firm 23andMe, signaling novel diversification strategies within the industry. Additionally, Tether’s CEO hinted at the possibility of launching a US dollar stablecoin specifically for domestic use, which could intensify competition within the stablecoin market. On a positive regulatory note, the SEC concluded its investigation into Crypto.com without pressing charges, providing some relief to the market.

The regulatory news involving Binance sent negative ripples across several higher-profile altcoins. KAITO dropped 12.40% over 24 hours, trading around $1.13 and extending its weekly loss past 18%. Its market cap subsequently fell to $273 million. Eigenlayer (EIGEN) saw a similar decline, down 11.11% to $1.05, bringing its market cap to $257 million. Story (IP) slid nearly 9% to $5.28, despite maintaining a larger market cap exceeding $1.35 billion. The TRUMP token also dropped 8.86% to $10.50, marking its worst recent daily performance, though its market cap held above $2 billion.

Despite the broad selloff hitting larger tokens, a handful of small-cap assets managed strong positive gains during the same period. Tutellus ($TUT) surged 131% to $0.0137, albeit with low trading volume. VIDT DAO ($VIDT) rose 44.5% to $0.0194, driven by bullish investor sentiment and strong volume. ArchLoot ($AL) gained 25.9%, now trading at $0.1231, while Layer3 ($L3) soared 20.1% to $0.128. CARV ($CARV) also saw solid movement, climbing 18.6% to reach $0.4669. These gains indicate continued investor interest in low-cap opportunities even during market instability.