The slow decline that began towards the end of the weekend accelerated on Monday evening in the US hours, leading to widespread losses in the cryptocurrency market.$BTC
Bitcoin (BTC) was trading just above the $95,000 level at press time and had lost 5% in the last 24 hours, while Ethereum (ETH) fell 10% to $3,590.
The CoinDesk 20 Index, which tracks the broader cryptocurrency market, is also down over 8% in the same period. Leading the way are altcoins such as Cardano (ADA), Avalanche (AVAX), and XRP (XRP), each down around 20%.
According to CoinGlass data, a total of $750 million worth of leveraged derivatives positions in digital assets were liquidated in the past 24 hours. Most of these positions were opened in anticipation of a price rally. These liquidations come as the crash on August 5th comes just shy of BTC’s sudden drop from $100,000 to $90,000 last Thursday.
Analytics company 10x Research, which evaluates the decline in cryptocurrency markets, evaluated the decrease in trading volume on stock exchanges and the acceleration of profit realization by long-term investors as signals that the market is losing momentum.
“This is likely a temporary consolidation period before the bull market picks up steam again,” said Markus Thielen, founder of 10x Research, who advised investors to be careful. “Investors should focus on which positions are outperforming the market and which are lagging behind. This rally will not be a period of everything going up,” Thielen said.
Digital asset hedge fund QCP said investors in options markets are predicting prices will trend sideways until the end of the year. It was noted that while profits were taken from previously opened bullish positions, some investors carried their positions until the beginning of the new year.
"Structurally, we believe we are still in a bull market, but spot prices are likely to trend sideways through the remainder of the holiday season," QCP said, advising investors to remain cautious.