The cryptocurrencies fall up to 10% affected by the sharp decline of technology stocks on Wall Street. Bitcoin falls more than 3.4% to $64,000, although the focus of concern in the market is Ethereum, which falls 8.5% to $3,100. The biggest declines belong to Avalanche (-10.1%), Near Protocol (-7.4%), Chainlink (-6.6%), Dogecoin (-6%).
To find the reasons that have motivated these falls, we must look at the US equities. This Wednesday, the S&P 500 and the Nasdaq They had their worst day since December and October 2022, respectively, weighed down by the collapse of technology stocks, especially those related to artificial intelligence (AI), after the results of Tesla and Alphabet (Google’s parent company) failed to convince investors.
Many analysts point out that the market is experiencing a rotation from the great technological values towards other more cyclical and smaller-cap stocks. They also point out that the market is suffering a long-overdue correction due to the overbuying of securities that have taken off in the stock market in the last few years. recent quarters as NvidiaIt should be noted that many cryptocurrencies have been strongly correlated with this company’s stock for most of the year.
“The triggers for the sell-off in US equities are the end of the momentum trade and the aversion to growth companies. Until these factors stabilize, it is difficult to foresee a recovery of the US indices.“, explained XTB.
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On the other hand, Ether has been greatly affected by A terrible day for cash exchange-traded funds (ETFs)These investment products have completely reversed the net capital inflows achieved on the first day of trading and closed their second day on the stock market with a net outflow of $133.3 million.
The big drag on the market, once again, has been Grayscale’s ETHE fund. Net outflows into this product have exceeded $800 million in just two days since its conversion into a spot ETF, and, as with its bitcoin counterpart GBTC, the market expects it to continue to put sharp downward pressure on the rest of these exchange-traded funds until much of its adjustment is complete.
Likewise, CryptoQuant analysts point out that The refund program of the extinct crypto exchange Mt. Gox would not be behind this fall of prices, which should be attributed, as we have already mentioned, to market sentiment and seasonal trends.
In this sense, the crypto exchange Bitstamp will begin distributing Mt. Gox bitcoins to creditors today after the company transferred nearly 8,000 bitcoins to the cryptocurrency exchange. While many analysts have pointed out that this process could weigh down the prices of the queen cryptocurrency, since the tokens have appreciated since the cyberattack suffered by Mt. Gox in 2014, now the consensus seems to lean towards a overvaluation of this risk.
On the business level, British regulators have fined Coinbase’s subsidiary in the country £3.5m for breaching a voluntary agreement designed to Preventing the cryptocurrency exchange from onboarding “high-risk clients”In October 2020, CB Payments Limited (CBPL) entered into a voluntary agreement with the UK’s Financial Conduct Authority (FCA), agreeing to restrictions that prevented it from taking on new clients that the regulator deemed high-risk. It also prohibited CBPL from offering services to these clients.
Source: Ambito
