Dogecoin Takes the Hardest Hit in Recent Crypto Market Downturn

• Altcoins have experienced a significant dip as the week begins, with most digital currencies maintaining a prolonged downtrend.
• The overall market capitalization of all crypto assets has decreased to $2.32 trillion, a drop from $2.39 trillion earlier today, resulting in a $70 billion loss.
• According to data from Coinglass, traders have faced over $242 million in liquidated positions, primarily from long positions in altcoins. Dogecoin (DOGE) enthusiasts have felt the brunt of these losses over the last 12 hours, closely followed by supporters of other memecoins like Shiba Inu (SHIB).

Dive into the latest developments in the cryptocurrency market, highlighting major downtrends in altcoins, significant liquidations, and the impact of institutional outflows.

Altcoins See Another Downturn

The cryptocurrency market commenced the week with a downturn in altcoins, continuing a downward trend observed over the past several months. Currently, the collective market capitalization of all crypto assets stands at $2.32 trillion, marking a reduction from $2.39 trillion recorded earlier in the day. This decline translates to a staggering $70 billion loss in market value.

Extensive Liquidations in the Altcoin Market

Recent data from the crypto analytics platform Coinglass reveals that traders have experienced over $242 million in liquidated positions, with most losses stemming from long positions in altcoins. Notably, Dogecoin (DOGE) traders have borne the heaviest losses within the last 12 hours. Other memecoins, such as Shiba Inu (SHIB), have also seen significant liquidations.

Impact on the Decentralized Finance (DeFi) Sector

The DeFi sector has not been spared from this downturn, with several tokens nearing or hitting all-time lows. DYDX, the native token of the Ethereum-based decentralized exchange, recently plummeted to $1.40, marking a 95% decline from its all-time high and coming close to its all-time low.

Curve Finance Faces Unprecedented Lows

Curve Finance (CRV), a prominent decentralized exchange, reached an all-time low of $0.23 late last week. This drop came on the heels of its founder facing liquidations amounting to approximately $100 million.

Institutional Investment Withdrawals

Reports from CoinShares, a leading digital assets management firm, indicate that institutional investors withdrew over $600 million from exchange-traded products (ETPs) in the past week. This move is largely attributed to a more hawkish stance from the Federal Open Market Committee (FOMC) than anticipated, prompting investors to reduce their exposure to fixed-supply assets.

Effect of the FOMC Meeting

CoinShares noted, “This occurred under similar circumstances: a period of significant inflows followed by a more hawkish-than-expected FOMC meeting, prompting investors to scale back their exposure to fixed-supply assets. These outflows and recent price sell-off saw total assets under management (AuM) fall from above US$100bn to US$94bn over the week.”

Conclusion

In conclusion, the cryptocurrency market has kicked off the week with a notable decline in altcoins and the DeFi sector, accompanied by substantial liquidations and institutional withdrawals. These developments underscore the volatility and complexity of the crypto market, and investors should continue to monitor trends and adjust their strategies accordingly.