Crypto Market Drops 4% as Bitcoin Falls 1% to $83,600

Bitcoin and other major cryptocurrencies, including Ether, XRP, Solana, Dogecoin, and Cardano, experienced significant drops early Wednesday, with each falling over 3%. This decline followed a price rally on Tuesday, leading to a 4% decrease in the total crypto market cap over the past 24 hours, reaching $2.73 trillion. Bitcoin's price fell from $84,200 to $83,600, while Ether and Cardano saw drops of up to 5%. XRP continued its downward trend, with potential for further declines. However, the filing of an XRP ETF by ProShares, scheduled to launch on April 30, provided some positive news for the market.

The movements in the crypto market indicate that investors remain cautious, avoiding risk due to global economic issues and upcoming regulatory changes. According to data from CryptoQuant, daily sales by large Bitcoin investors have decreased from 800,000 BTC in late February to about 300,000 BTC currently, as many have already sold their coins at a loss. Analyst Ali Martinez noted that whales have been taking profits during the recent rally, offloading over 29,000 BTC since April 9. Additionally, over $600 million in short positions could be liquidated if Bitcoin rebounds to $86,900. There has also been a decline in accumulation by large investors, with their holdings decreasing by about 30K BTC over the past week. Major cryptocurrencies slumped as stocks fell 2.9% despite strong growth in the economy. The ongoing tariff troubles continue to push traders to avoid risk assets, impacting crypto markets.

Amid market uncertainty, stablecoins like Tether (USDT) and USD Coin (USDC) have maintained their value. Tether is currently trading at $0.9999, with a market cap of $144.56 billion, while USDC is trading at $1. Stablecoins are becoming essential for liquidity and security during volatile times in the crypto market.

Markets saw a downturn on Tuesday evening after Nvidia Stock dropped, triggered by a $5.5 billion charge due to the government’s decision to ban the company from selling H20 chip sales to China. As a result, Bitcoin fell to $83,600, while XRP and Cardano followed suit, falling over 2% and 4% respectively. AI coins also struggled as Nvidia’s stock dropped 8% to $89.10. The company revealed that it expects to lose $5.5 billion in Q1 due to restrictions on its H20 chip exports to China.

Fed Chairman Jerome Powell is set to speak today about the US economy as markets watch closely for any signs of a potential rate cut sooner than expected due to ongoing tariff concerns and rising fears of a recession. Research suggests that the trade war and tariffs might lead to lower inflation, which could give the Fed an opportunity to cut rates. However, while some believe that markets have already priced in the risks, analysts claim that the worst may still not be over. Bitcoin’s appeal as a decentralized asset is rising amid traditional volatility, but market risks remain high.