Crypto is down today, as the total cryptocurrency market capitalization has seen a significant shift, dropping 4.4%, now standing at $3.4 trillion. The total crypto trading volume is at $119 billion at the time of writing.
TLDR:
Why is Crypto Down Today? Crypto Winners & Losers
In a complete opposite to yesterday’s situation, all top 10 coins recorded price decreases in the last day. Among these, Solana (SOL) and Cardano (ADA) lost the most: 5.1% each, trading at $171.75 and $0.7745, respectively.
After reaching a daily high of $104,156, Bitcoin (BTC) decreased by 1.4% and below the $103,000 mark, currently trading at $102,067.
Ethereum (ETH) saw a high of $2,638, but fell by 3% over 24 hours, now changing hands at $2,545.
While only five coins among the top 100 saw their prices increase, the best performer is Monero (XMR). It’s up 1% to $343.6.
On the other hand, five coins recorded double-digit decreases. Ethena (ENA) fell by 12.2% to $0.3752, followed by Jupiter (JUP)’s 11.3% drop to $0.5034.
The declines in prices are the result of broader market corrections and selling pressure. Additionally, there are specific challenges projects face, including a decrease in network activity and investor behavior.
However, analysts expect Solana to bounce back, though it’s meeting headwinds. Still, inflows suggest an increase in demand. “Liquidity tends to follow activity, and as demand returns, the most active ecosystems like Solana naturally become liquidity magnets. That’s how the flywheel starts turning,” said Kaitai Chang, Co-Founder and COO of liquidity layer Yala (ex Binance Labs)
‘Bitcoin’s Trajectory Is Undeniably Upward’
As the market turns bearish, experts still note a bullish future.
Dom Harz, Co-Founder of hybrid Layer-2 BOB, commented that Bitcoin is actually entering its next phase. This is “not just in price, but in institutional adoption, technical innovation, and utility.”
Harz argues that some people remain focused on short-term corrections. However, there is a bigger picture to observe, namely that “Bitcoin’s trajectory is undeniably upward.” Per the co-founder, “with a market cap now larger than silver and Google, it’s the sixth most valuable tradable asset in the world. With this, follows opportunity.”
Indeed, at the time of writing, Bitcoin stands before Google and silver, and after gold, Microsoft, NVIDIA, Apple, and Amazon.
Additionally, Bitcoin DeFi TVL has nearly doubled in a month. It now stands at $6.216 billion, per DeFiLlama. Innovations enable BTC to be natively and securely deployed into DeFi protocols, Harz says.
“And it’s not just retail paying attention. JP Morgan recently highlighted DeFi’s potential to reshape institutional finance, opening up new opportunities to earn yield on the $72 billion worth of Bitcoin currently held by institutions. Institutions are piling into Bitcoin; the capital and conviction are here, and the tech is right behind them,” Harz says.
Levels & Events to Watch Next
We are currently in the bearish zone. Short-term indicators suggest possible further decreases. In the case of BTC, a level to keep an eye on is $103,000. Should it manage to reclaim it, BTC could swiftly climb higher. Yet, we may see a drop below $101,900 today, which may further lead below the psychologically significant $100,000.
As for market sentiment, the Fear and Greed Index went up from 70 to 71 today, signaling extended caution as the market may be entering overbought territory. It has been steadily climbing for the last 30 days. This is another indicator of potential price shedding ahead.
Nonetheless, institutional investors restarted their investments into the US-based spot Bitcoin exchange-traded funds (ETFs), thus reversing Tuesday’s net outflows of $96.14 million. On Wednesday, the eleven ETFs saw nearly $320 million in inflows, with BlackRock’s share standing at $232.9 million.
Traders are now waiting for further signals from the US, primarily regarding inflation and the Federal Reserve’s interest rate moves. The latter may cut rates already in July, weakening the dollar, and sending investors to risk-on assets. This would be bullish for Bitcoin and crypto in general.
However, there are indicators that the Fed may not move that fast, focusing on inflation control instead before a rate cut.
Notably, Russia-Ukraine peace talks are held in Istanbul today. Potential positive moves may propel risk-on assets higher. However, there is currently a lot of confusion surrounding the talks, as CNN reports from Istanbul, namely, when it will start (if at all) and who will attend.
Quick FAQ
- Why did crypto move against stocks today?
While the cryptocurrency market is experiencing a downturn, US stock markets are showing modest gains on 15 May. The crypto market is waiting for additional macroeconomic cues, and traders are engaging in profit-taking. Investors seem slightly more confident in the stock markets today, with the S&P 500 rising 0.1%, and the Nasdaq-100 increasing by 0.6%. That said, the Dow Jones Industrial Average is currently down by 0.2%.
- Is this dip sustainable?
Following a recent rally, investors seem to be locking in profits, driving a dip. Though a long-term upturn may resume, a short-term dip looks sustainable due to technical cooling, reduced activity, and general macro caution.
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