Crypto market has yet again gone deep red after seeing greens. Bitcoin, Ethereum and XRP are down between 3 to 5 percent as the total market cap falls to $108 billion. As for why the ongoing fall, BitMEX research states, in cryptocurrency, “Trader sentiment is king” as “prices are falling regardless of the news or investment flows.”
Cryptos Falling Yet Again
Bitcoin is yet again below $3,500 while being down more than 82 percent since its all-time high (ATH). At the time of writing, Bitcoin has been trading at $3,410 with 24 hours loss of over 4 percent.
Meanwhile, Ethereum has dropped down more than 93 percent since its peak, currently trading at $88 while being down about 5 percent. The 3rd largest cryptocurrency is managing the daily trading volume of $1.67 billion.
Whereas, XRP at 2nd spot is down 91 percent from its ATH. It has dropped down below $0.30 with a loss of 2.55 percent while managing the daily trading volume of about $415 million.
The price movement of top five cryptocurrencies is in tandem with Bitcoin as shown in the chart below.
This has taken the total market cap to extreme lows that will soon be touching the $100 billion mark.
Meanwhile, the domination chart is seeing Bitcoin on a hike at 55 percent as altcoins fall harder than the leading cryptocurrency.
Since mid-November the crypto market is crashing with no concrete reason behind the fall. According to the latest report of BitMEX, “unusually large miner selling of Bitcoin” could be behind this but again as it states, “For cryptocurrency, trader sentiment is king.”
“We are in a bear market and prices are falling regardless of the news or investment flows.”
The report further talks about the mining profitability and price crash with respect to the below graph.
“Prior to the recent crash, the industry was making gross profit margins of around 50% (these figures assume electricity is the only cost included in gross profits), while after the price crash, this fell to around 30% for Bitcoin and 15% for Ethereum.”
The report states that the revenue for bitcoin mining industry has dropped down from $13 million per day at November beginning to $6 million, in early December. Moreover, the drop in incentives was more than the price due to delay in difficulty adjustment.
As for Ethereum, its hash rate has fallen 20 percent while the prices have dropped significantly. The gross profit margins for Ethereum declined even more sharply which doesn’t have any specific reason.
The report concludes with, “This is likely to be a very tough time for the mining industry. However, for miners with lower costs, our basic analysis indicates that the situation may be better than people expect.”