Monday wasn't kind to cryptocurrency holders. Major digital assets tumbled as investors pulled back from riskier plays, with Bitcoin (BTC) leading the retreat.
Here's how the major cryptocurrencies looked at 8:20 p.m. ET:
| Cryptocurrency | Gains +/- | Price (Recorded at 8:20 p.m. ET) |
|---|---|---|
| Bitcoin (BTC) | -1.11% | $86,738.52 |
| Ethereum (ETH) | -1.92% | $2,802.70 |
| XRP (XRP) | -2.82% | $2.02 |
| Solana (SOL) | -1.00% | $127.47 |
| Dogecoin (DOGE) | -2.89% | $0.1361 |
When It Rains, It Pours
Bitcoin dipped below $84,000 during early trading hours, marking its weakest showing since mid-April. The world's largest cryptocurrency saw trading volume surge 72% over the past 24 hours, a clear sign that sellers were out in force.
Ethereum slipped under $2,800, erasing roughly ten days of gains in a single session. XRP and Dogecoin weren't spared either, both posting significant losses.
The pain extended to cryptocurrency-adjacent equities. Strategy Inc. (MSTR) and Coinbase Global Inc. (COIN) dropped 3.25% and 4.76% respectively during regular trading hours.
According to Coinglass data, cryptocurrency liquidations hit $587 million over the past 24 hours, with $460 million coming from bullish long positions getting wiped out.
The situation could deteriorate further. Roughly $500 million in Bitcoin long positions face liquidation if the cryptocurrency breaks below $83,000.
Bitcoin's open interest edged up 0.12% in the last 24 hours. When open interest rises while prices fall, it typically signals that traders are opening fresh short positions, betting on further declines.
The Crypto Fear & Greed Index showed "Extreme Fear" sentiment intensifying across the market.
Top Gainers (24 Hours)
| Cryptocurrency (Market Cap>$100 M) | Gains +/- | Price (Recorded at 8:20 p.m. ET) |
|---|---|---|
| pippin (PIPPIN) | +38.08% | $0.1924 |
| Folks Finance (FOLKS) | +23.84% | $13.84 |
| Merlin Chain (MERL) | +14.52% | $0.3919 |
The global cryptocurrency market capitalization stood at $2.93 trillion, contracting 2.98% over the past 24 hours.
Equities Join the Downdraft
Cryptocurrencies weren't alone in their misery. Traditional equities kicked off the week in negative territory as well. The Dow Jones Industrial Average retreated 427.09 points, or 0.9%, closing at 47,289.33. The S&P 500 declined 0.53% to finish at 6,812.63, while the tech-focused Nasdaq Composite shed 0.38% to end at 23,275.92.
On a brighter note, expectations for a Federal Reserve rate cut next week strengthened. Traders are now pricing in an 87.5% probability of a 25-basis-point cut, up from 84.4% the previous week, according to the CME FedWatch tool.
The Silver Lining? Maybe a Big One
Despite Monday's bloodbath, blockchain analytics firm CryptoQuant spotted something interesting. Binance's "Bitcoin to Stablecoin Reserve Ratio" has plummeted to its lowest level since 2018.
Translation: The amount of stablecoins sitting on Binance relative to available Bitcoin is at its highest point in over six years. That's a lot of dry powder waiting on the sidelines.
"History shows that hitting such lows often precedes powerful Bitcoin rallies, simply because the liquidity required to fuel a price surge is now fully available on the exchange," CryptoQuant predicted.
Michaël van de Poppe, a widely followed cryptocurrency analyst, highlighted the importance of the $83,400 level as Bitcoin's key support zone.
"If that doesn't provide enough buying pressure, then we're going to test the low beneath $81,000 for support. Probably in the next few days," the analyst projected.
So while today's action stung, the setup might be forming for something more interesting down the road. At least that's what the historical patterns suggest.