Top Reasons Why the Crypto Market Is Down

Pooja Khardia
Updated
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Cryptocurrency Market Today: BTC Drops Below $96K, MOVE and HYPE Face Significant Declines

The fall of overall trading volume to  $63.63B indicates a slow crypto market, but the rest of the factors also indicate the same. The TV has declined 17% in just a day, and the overall crypto market cap has dropped to $2.3 Trillion. Along with that, the fear and greed index has also shifted away from the bulls.

The result of the market fall is the decline of Bitcoin and Ethereum prices, along with many other top cryptocurrencies. Bitcoin is currency trading at $62,309.95 after a 2% fall, and Ethereum price is trading at $ 2,999.41 after a 2.2% fall. The decline seems to continue for now, bringing the rest of the cryptocurrencies down as well.

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Reasons Behind Today’s Crypto Market Decline

The crypto market has been moving sideways for weeks and only showed some short of a surge in the past few days. But that has also been disturbed by today’s fall initiated because of the new regulatory issues in the crypto market. Other than that, a decline in Bitcoin Futures ETF and exchange inflow has brought the investor’s sentiments down, creating bearish situations.

SEC Interfering With the Crypto Market

Robinhood has become the next target of the SEC as the exchange received Wells notice from these US regulators. Robinhood has recently revealed this information in a filing on Monday and said,

On May 4, 2024, RHC received a ‘Wells Notice’ from the Staff of the SEC (the ‘Staff’) stating that the Staff has advised RHC that it made a ‘preliminary determination’ to recommend that the SEC file an enforcement action against RHC alleging violations of Sections 15(a) and 17A of the Securities Exchange Act of 1934, as amended

As a result of this, the exchange has decided to halt any of the cryptocurrencies that have been called or named as securities by the SEC. It is not the first time Robinhood has removed support for cryptocurrencies. Previously, when SEC was involved with Binance and Coinbase, calling Cardano, Solana, and Polygon as securities, Robinhood immediately removed these three cryptos.

Consecutive Bitcoin Future ETF Outlfows

The last week was the fourth continuous week witnessing increased outflows in the crypto market, where the AUM (Assets Under Management) declined by $251 Million. These outflows have continued despite the Hong Kong Bitcoin and Ethereum ETFs launch. These maximum outflows were noticed in the case of Bitcoin, as $284 million got pulled from funds.

This continuity in outflows has brought the popularity of Bitcoin ETF down, directly impacting Bitcoin prices.

In contrast, Ethereum broke its a-week streak of outflows with a record of $30 Million in inflows. So, that makes the total inflow rate US$307 M within just the first week of the launch of these Hong Kong ETFs.

Decade Low Bitcoin Inflow Rate Among Exchange

Apart from the losses in the Bitcoin ETF inflow, the exchange inflow has dropped to the lowest of the decade. Similar to 2015, the Bitcoin exchange inflow value is now only at 20K BTC. Moreover, the long-term holders have halted the distribution to reaccumulate the Bitcoin.

The crypto market might witness a complete downtrend as Bitcoin moves towards an accumulation zone. A few analysts have spoken of the probability of Bitcoin crossing the $50K mark before returning to an all-time high.

Read More 2 Reasons Why XRP Price Might Target $5 By 2024 End

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Pooja Khardia is a seasoned crypto content writer with 6+ years of experience in writing, including in blockchain, cryptocurrency, DeFi, and digital finance reporting. In her adventure journey, she is currently working with CoinGape Media and leading their Trending Section. Here, she uses her expertise to deliver analytics, market insights, price predictions, and information on what’s trending in the crypto space, aiming to keep the crypto and web3 community updated with market trends and important insights. Known for a user-centric and straightforward writing style, Pooja is passionate about making crypto easy and accessible. Her writing blends market research with storytelling, helping readers stay ahead in a fast-paced industry. When not behind the keyboard, Pooja embraces her creative side through drawing and crafting. Connect with Pooja on LinkedIn or X.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.