Why Is The Crypto Market Down Today? (2024)

The cryptocurrency market experienced a downturn, with the total market capitalization dropping to $2.51 trillion over the last day as of May 30, 2024. The market volume in the last 24 hours has fallen by 9.22%. Bitcoin, the largest cryptocurrency, is currently trading at $67,659, 2.82% down over the past seven days and 0.22% decrease in the last 24 hours. Ethereum, the second-largest cryptocurrency, is trading at $3,732, down by 2.06% in the last seven days.

The cryptocurrency market is down today as fear rises among investors after Mt. Gox’s $9 billion bitcoin transfer and slowing inflows of the U.S. spot bitcoin ETFs.

Let us dig deep into it

How is the Crypto Market Performing?

The cryptocurrency market is experiencing a downfall, it can be because of the approximately $9 billion BTC being transferred from Mt. Gox’s cold wallet to an unknown address. It likely went through thirteen transactions, raising dump fear in the market. Another reason could be that the spot bitcoin ETF inflows are falling again.

The cryptocurrency market is exhibiting significant volatility, with prices fluctuating unpredictably. Currently, there is a downturn after Bitcoin surpassed its all-time high multiple times in March. The Dencun upgrade and Bitcoin halving did not bring the surge that the market anticipated. Also, as people expected, the latest U.S. SEC approval over the ETH ETFs has not brought any rise in the crypto world. As of the latest update, the Fear and Greed index stands at 61, indicating a greed state.

The largest cryptocurrency by market capitalization, Bitcoin has fallen nearly 2.90% in the last 24 hours and is trading at $67,598 as of May 30, 2024. On the other hand, Ethereum almost dipped by 2.27% and is trading at $3,726.

Let us see the reasons why the crypto market is down today

Crypto market analysts do not expect the Federal Market Committee (FOMC) to change interest rates, as investors are gradually getting used to the fact that the U.S. central bank may not cut rates at all this year.

As of May 1, 2024, the 11 Spot Bitcoin ETFs saw a collective net outflow of around $563.7 million, the largest since the funds began trading on January 11. This extended a five-day losing streak, according to data source CoinGlass. Investors have pulled out around $1.2 billion from the ETFs since April 2024. Also, remarkably, BlackRock’s iShares Bitcoin Trust (IBIT) experienced its first-ever outflow this month, which saw nearly $36.9 million exit the fund.

Additionally, Fidelity’s FBTC led to outflows, losing $191.1 million in withdrawals. This might be a panic state for bulls, as BlackRock’s IBIT and FBTC continuously attracted funds in the first quarter, more than compensating for the uniform large outflows from the comparatively costly Grayscale ETF (GBTC).

Is Investing in Cryptocurrency Safe?

The cryptocurrency market has seen the good side as well as the worst side of the market, be it post-Russia-Ukraine effects, Terra-Luna crash, FTX collapse or tightened tax regulation, it has witnessed roughest storms during the past few years.

The year 2023 gave a fresh start to the crypto world, showing positive signs of recovery. Crypto investors believe that in situations like this, investing in stable digital currencies like Bitcoin and Ethereum in SIP format is a safe choice. Crypto experts consider that in the overall portfolio, investors should just look at investing just the 5% exposure to cryptocurrencies. The most important part is to invest only a miniscule amount and not all your life savings as the market is highly volatile and there are chances of you losing it all.

Steps On How To Invest In Indian Cryptocurrency Market

Step 1: Select the best cryptocurrency: Choose a cryptocurrency you wish to invest in. Like any other asset class, crypto has its own fundamentals and different blockchain networks back them, intrinsic value and mining techniques. Make sure that you research and analyze before investing as the crypto market is highly volatile.

Step 2: Select a crypto exchange: After you made up your mind about a cryptocurrency it’s time for you to find a perfect crypto exchange platform for yourself. It is a necessity to have a functional account in a crypto exchange which will help you to buy and sell cryptocurrencies. Check out our article on the best cryptocurrency exchanges in India.

Step 3: KYC: Once you select a crypto exchange you need to register yourself by providing personal details like name and address and complete the entire KYC formalities. After setting up your account you’re ready to invest in cryptocurrency.

Step 4: Choose payment mode: For buying a cryptocurrency you need to select a payment option that you find comfortable. You can choose peer-to-peer, bank transfer, online payment mode or a crypto wallet.

Step 5: Purchase cryptocurrency: After adding the funds to your account you can smoothly buy your selected cryptocurrency. All you have to do is press on the “buy” tab and you can easily buy the cryptocurrency of your choice.

Step 6: Storage: After you purchase the crypto coins, don’t forget to store your currencies securely because they are not regulated and you must keep them safe as there’s always a risk of hacking or theft. You can check out the crypto storage options from here.

Step 7: Selling cryptocurrency: This is as important as buying as this helps you make money out of investing. You can sell the cryptocurrency the same way you purchased it, just click on the tab “sell” in your portfolio. You can fully or partially sell your crypto investment based on your choice but don’t forget to timely book your profits.

Bottom Line

It is a wise choice to observe the crypto market prudently with the uncertain environment and slow recovery of macroeconomic situations in the world. Do not make any reckless decisions as it is a good time to observe the market closely and analyze it.

One may never know, but the observation will eventually help the investors to make smart decisions and might have a favorite digital asset at a fair value, once the chaos situation fizzes out completely.