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Why is the cryptocurrency market down today (Aug 18)?

Why is the cryptocurrency market down today?

Following the recent news that Elon Musk’s SpaceX had sold all of its Bitcoin (BTC) holdings in 2021, the majority of assets in the cryptocurrency sector have started the day on the wrong foot, their total market capitalization dropping over 6.26% on the daily chart.

Specifically, more than $62 billion has drained from the crypto market, dropping from $1.1 trillion to $1.037 trillion in a matter of hours following the report by the Wall Street Journal on the rocket company and satellite operator’s finances, including its BTC holdings, shared on August 17.

Total crypto market cap 24-hour chart. Source: CoinMarketCap

Market representatives

Additionally, most digital assets are recording declines in prices, including Bitcoin, which has dropped below $27,000, dropping nearly 7% on the daily chart, which added to its losses of close to 10% in the last week and over 11% in the past month, currently trading at $26,533.

Bitcoin 24-hour price chart. Source: Finbold

At the same time, Ethereum (ETH) has also dipped and is presently changing hands at $1,691.82, down 5.5% in the last 24 hours, as well as declining 8.36% across the previous seven days and 11.27% on its monthly chart, according to the latest data retrieved on August 18.

Ethereum 24-hour price chart. Source: Finbold

Causes for crypto dip

Indeed, the massive dips in the crypto market started as soon as the WSJ published its report on SpaceX’s finances. That said, the recent crypto crash may not be exclusively a reaction to the news. 

As a matter of fact, the decline began in the early hours of August 17, as traders started to liquidate hundreds of millions of dollars in crypto derivative contracts like futures and options, expecting the upcoming period of monthly options expiration by the end of the week.

At the same time, the benchmark United States Treasury yield rose to its highest level in almost two years, the day following the minutes from the Federal Open Market Committee’s (FOMC) July meeting sparked fears, also likely contributing to cryptocurrencies tanking.

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