$270 billion is lost in the cryptocurrency selloff as ether and bitcoin plummet
On Sunday, the value of the cryptocurrency market crashed as investors kept pulling out of riskier investments.
The total value of cryptocurrencies fell by over $270 billion during the last day, driven primarily by an 11% decline in bitcoin and a 21% decline in ether, based on CoinGecko data.
The selloff in the cryptocurrency market was accompanied by a wider decline in Asia-Pacific equity markets. The Bank of Japan's announcement that it would raise its benchmark interest rate to a level not seen since 16 years caused the Nikkei 225 in Japan to fall as much as 7%, extending losses that started last week. In the U.S., the Nasdaq finished a three-week losing streak of 3.4% last week, the worst since September 2022, when the tech-heavy index was plunging. Nvidia and Amazon were among the companies that lost ground.
The decline in the manufacturing sector, increased unemployment, a weaker-than-expected jobs report, and dismal earnings all contributed to last week's stock market meltdown. Rather than cutting rates as many market observers had predicted, the U.S. Federal Reserve chose to maintain its benchmark rate unchanged in September. Better performance for riskier assets is typically correlated with lower interest rates.
The price of bitcoin has dropped to its lowest point since February. At almost $54,000, the biggest cryptocurrency in the world is trading. It has still increased by about 23% this year.
Ether, the native token that powers the Ethereum network, lost all of its annual gains and is now trading at about $2,300. The price of solana has dropped by 10%, and Binance's BNB coin has dropped by more than 15%.
This week, investors will also be watching central banks in Australia and India, as well as fresh trade statistics from China and Taiwan.
After the SEC approved new spot exchange-traded funds for bitcoin and ether this year, hundreds of millions of dollars have flowed into the ETFs, causing a wider base of investors to feel the effects of the latest crypto wipeout.
