Bitcoin dives to six-month low as investors flee risk-on assets amid macroeconomic uncertainty

Investors are fleeing perceived riskier assets similar Bitcoin owed to a challenging macroeconomic situation severely impacting the crypto market.

Bitcoin‘s terms plunged to a six-month debased of nether $50,000 amid a broader crypto marketplace sell-off that led to implicit $1 cardinal successful liquidations.

The flagship integer plus mislaid captious enactment levels successful the past day, extending its mediocre play show into the Asian trading hours of Aug. 5. Bitcoin fell to arsenic debased arsenic $49,121, marking a 13% diminution wrong 24 hours. However, it has since rebounded to supra $52,000 arsenic of property time.

Similarly, Ethereum experienced a astir 20% driblet to $2,100, its lowest terms since December 2023, amid speculation astir organization offloading.

Meanwhile, different large cryptocurrencies, excluding stablecoins, besides suffered important losses. Solana, XRP, BNB, Cardano, and Dogecoin each saw losses exceeding 15% during the reporting period.

According to CryptoSlate’s data, the plus declines resulted successful the full crypto marketplace capitalization falling by astir 16.57% to astir $1.88 trillion. This represents the market’s lowest worth since February, erstwhile it was nether $2 trillion.

Additionally, the sell-off resulted successful $1.05 billion successful liquidations. The astir important azygous liquidation occurred with a BTC-USD transaction worthy $27 cardinal connected Huobi. Long traders, who had expected prices to rise, mislaid astir $902 million, portion abbreviated traders mislaid $153 million.

Why did crypto crash?

Market analysts property these sell-offs to assorted factors, including the macroeconomic situation, and determination are speculations astir a systemic marketplace hazard involving an manufacture player.

Arthur Hayes, co-founder of BitMEX, suggested that important marketplace players whitethorn beryllium dumping their integer assets. He stated:

“My TradFi birdies are telling maine idiosyncratic large got smoked and is dumping each #crypto. No thought if this is true, but fto the fam cognize if you are proceeding the same.”

Rumors earlier suggested that Tron laminitis Justin Sun was liquidated, but Sun has denied these claims. He stated that his steadfast does not prosecute successful leveraged trading strategies due to the fact that they bash not payment the market. He added:

“We similar to prosecute successful activities that supply greater enactment to the manufacture and entrepreneurs, specified arsenic staking, moving nodes, moving connected projects, and helping task teams supply liquidity.”

Meanwhile, others person linked the crypto downturn to broader economical factors. Markus Thielen, laminitis of 10X Research, told CryptoSlate that the US system appears weaker than initially believed. He predicts a precocious likelihood of a 2025 recession, with the banal marketplace often anticipating specified downturns successful advance.

Thielen warned that if the banal marketplace continues to decline, Bitcoin prices could revisit the $50,000 level and perchance driblet further.

Similarly, Gracy Chen, CEO of BitGet, noted that BTC prices could proceed to autumn owed to geopolitical tensions, concerns astir the US recession, and declines successful the US and Japanese banal markets.

The station Bitcoin dives to six-month debased arsenic investors fly risk-on assets amid macroeconomic uncertainty appeared archetypal connected CryptoSlate.