Bitcoin experienced a 15% drop early in the morning on the 5th, sinking to a low of $49,443, the lowest since late February, before recovering and trading around $54,300. Ethereum also fell about 11% to $2,386 on the morning of the 5th, marking a six-month low. Dogecoin dropped over 10%, hitting a six-month low of about 10 cents.
According to data from CoinShares, there was a capital outflow from Bitcoin ahead of this crash, with losses amounting to $400 million (about 58.5 billion yen) in the week leading up to August 3. During the same period, Ethereum lost $146 million (about 21.2 billion yen).
The recent sharp decline in cryptocurrencies coincided with a crash in the U.S. stock market. The Dow Jones Industrial Average fell more than 2.5% on the 5th, marking its biggest drop since September 2022. The tech-heavy Nasdaq also declined nearly 3%, and the S&P 500 fell by 3%. This decline was led by significant drops in major tech stocks, including an 8% drop for Apple, 14% for Nvidia, 8% for Amazon, 7% for Meta, and a 6% drop for Alphabet, Google’s parent company, during intraday trading on the 5th.
The drop in cryptocurrencies on the 5th represents a complete turning point since Bitcoin reached the significant milestone of $69,000 in March. This rise was in response to a series of major financial institutions, including BlackRock and Fidelity, receiving approval for a spot Bitcoin ETF.
Bitcoin, created in 2008 as an alternative to fiat currency, first surpassed the $10,000 mark in 2017. After surging in early 2020 amid the COVID-19 pandemic, Bitcoin exceeded $61,000 in November 2021, but fell to the $16,000 range in 2022 amid concerns over high inflation and a looming recession.
( original article on forbes.com )