The current upswing in the price of cryptocurrencies appears to have come to an end.
BTC/USD (Data obtained from CoinGecko)
Several of the most prominent cryptocurrencies on the market have been experiencing a general selloff, including Bitcoin and Ethereum, which started early on Friday. According to data provided by CoinGecko, the price of Bitcoin has decreased by 7.3% in the last 24 hours, falling from about $23,500 to $21,750 at the time of this publication. The current price of Ethereum, which is $1,730, represents a loss of 6.2%. The top cryptocurrencies have seen gains over the past few weeks, supported by increased optimism over the market and broad anticipation for Ethereum's imminent "Merge" to Proof-of-Stake. This optimism has helped propel the market higher. Despite this, the value of both assets has been on a downward trend over the course of the past week as momentum has waned.
The decline affected a wide variety of other significant crypto assets as well. Other cryptocurrencies with smaller market capitalizations have a tendency to have a more precipitous decline in market value when Bitcoin and Ethereum are experiencing losses. This is because scared market players hurry to liquidate their positions. During the previous twenty-four hours, the value of Dogecoin, Polygon, NEAR, Solana, and Avalanche have all dropped by more than ten percent.
One company that has bucked the trend despite the market's downward trend is Gnosis, which has seen its share price rise by 5.2%. On Thursday, Gnosis Safe made an announcement that it would be airdropping a new token known as SAFE to early users. This likely explains why the Gnosis cryptocurrency is maintaining its value despite the recent market turmoil.
After the cryptocurrency market recovered from the lows it reached in June during the month of July and into the early part of August, many participants in the market had placed their expectations on the bullish surge continuing into the fourth quarter. The Merge event that Ethereum is planning to release around September 15 is, without a shadow of a doubt, the most powerful catalyst for a potential surge in the market. The once-buzzing Merge narrative, on the other hand, has started to lose pace over the past week because to mounting concerns regarding Ethereum's censorship resilience in the aftermath of the Treasury's action to sanction Tornado Cash.
The total market capitalization of all cryptocurrencies suffered a loss of approximately 6.8 percent during the most recent retrace. The sector is currently valued at $1.08 trillion, which is around a 64% decrease from its all-time high in November 2021.
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