The crypto market lost a fifth of its value over the month. It returned to the levels of the beginning of the year
The crypto market's capitalization has collapsed nearly 20% in just over a month, virtually leveling out the growth since the beginning of the year, Bloomberg calculated.
At the peak on Oct. 6, the combined market value of all cryptocurrencies reached roughly $4.4 trillion, but since that collapse, gains since the beginning of the year remain at just 2.5% year-over-year, according to CoinGecko data. Digital assets are worth less now than they were when Trump took office, whose statements in support of cryptocurrencies once drove up the price of bitcoin by 35%, the agency noted.
Cryptocurrencies began to fall just a few days after updating the historic high. The collapse was caused by the liquidation of leveraged positions worth $19 billion, which undermined investor confidence. Now traders show almost no signs of faith in recovery, Bloomberg writes.
Bitcoin has already lost 9.5% since Monday, Nov. 3, putting it on track for its worst weekly performance since March, the agency noted. It fell below the $100,000 mark again on Friday and was trading near it at the time of publishing this text. That said, while the sell-off has engulfed the entire market, the sharpest losses have come in altcoins - smaller, more volatile tokens that have already lagged significantly this year.
What's next?
Despite the gloomy sentiment, there are some signs of stabilization. After six consecutive days of net outflows of funds, U.S. ETFs on spot bitcoin and ether recorded an inflow of $253 million on Nov. 6, Bloomberg notes.
"If we exclude bitcoin and ether, the cryptocurrency market has been under pressure for months. We see very little inflow of new capital into altcoins or DeFi projects," said SignalPlus partner Augustine Phan. According to him, in the absence of short-term drivers and continuing security and regulatory risks, the participation of large investors in the market is likely to remain weak in the near future.
According to Jeff May, chief operating officer of the BTSE crypto exchange, the collapse of digital assets is due in part to concerns that AI-related stocks are overvalued. "If we see a sell-off in AI and technology stocks, it's very likely that bitcoin and altcoins could fall even further," he warned.
This article was AI-translated and verified by a human editor
