Tech Sell-off, Strong U.S. GDP Hurt Crypto Sentiment

Cryptocurrencies plunged heavily in the past 24 hours in the aftermath of a massive tech sell-off triggered by downbeat earnings updates from tech majors Alphabet and Tesla. Stronger-than-expected U.S. GDP update and net outflows from Ethereum Spot ETF products in the U.S. on Wednesday exacerbated the negative sentiment.

Data released by the U.S. Bureau of Economic Analysis revealed a growth of 2.8 percent in the second quarter. Markets had expected the second quarter’s growth to rise to 2 percent from 1.4 percent in the previous period.

The CME FedWatch tool that tracks the expectations of interest traders still shows rate cut expectations for the September review at 100 percent. Markets however overwhelmingly expect a pause in the next FOMC scheduled for July 31.

Data released by Farside Investors showed net outflows of $133 million from Ethereum spot ETF products in the U.S. on Wednesday versus net inflows of $107 million on Tuesday, the day of the launch. The outflows of $327 million from Grayscale Ethereum Trust (ETHE) which was converted to a spot ETF exceeded the inflows of $193.6 million recorded by 7 new ETFs. Fidelity Ethereum Fund (FETH) topped with net inflows of $74.5 million followed by Grayscale Ethereum Mini Trust (ETH) that recorded inflows of $45.9 million.

Amidst the developments, overall crypto market capitalization declined 4.6 percent overnight to $2.3 trillion from $2.43 trillion a day earlier. The political memes category dropped 8.76 percent whereas the broader memes category shed 8.4 percent in the past 24 hours. AI& Big data category cryptocurrencies also saw market capitalization decline by 7.7 percent overnight. None of the top-100 cryptocurrencies have recorded overnight gains of more than a percent.

Bitcoin plunged to a low of $63,833 in the past 24 hours. It is currently trading at $64,089.90 recording overnight losses of 4 percent and weekly losses of almost 1 percent, curtailing year-to-date gains to 51 percent. At its current price, the leading cryptocurrency is trading 13 percent below the all-time high recorded in March 2024.

Ethereum tumbled 8.7 percent in the past 24 hours to trade at $3,159.89, around 35 percent below the all-time high. Amidst weekly losses of close to 9 percent, the leading altcoin’s year-to-date gains have reduced sharply to less than 39 percent. The broad-based market sell-off had dragged the altcoin to a low of $3,133.99 earlier in the trade.

Bitcoin increased its dominance to 55 percent of the overall crypto market whereas Ethereum’s share declined to 16.5 percent of the market. Amidst growing risk aversion, the market capitalization of not-so-volatile stablecoins increased to $172 billion or 7.5 percent of the overall crypto market.

4th ranked BNB (BNB) dropped 4.2 percent overnight and 2.4 percent on a weekly basis to trade at $561.57.

5th ranked Solana (SOL) slipped 5.7 percent overnight to trade at $168.41. SOL has gained 5 percent in the past week and is the highest-ranking crypto to trade with weekly gains.

6th ranked XRP (XRP) slipped 3.7 percent overnight to trade at $0.6083. Despite gains of 5 percent in the past week and 27.8 percent over the past 30 days, year-to-date losses still exceed a percent. XRP is the highest-ranking crypto to trade in the red on a year-to-date basis.

Dogecoin (DOGE), ranked 8th overall has also plunged 7.6 percent in the past 24 hours to trade at $0.1241. DOGE has however added 1.7 percent in the past week.

9th ranked Toncoin (TON) declined 6.1 percent overnight to trade at $6.54. TON tops year-to-date gains among the top-20 cryptocurrencies with an addition of 183 percent.

10th ranked Cardano (ADA) declined 6.3 percent overnight and 10 percent over the past week. ADA is currently trading at $0.3929 having slipped more than 33 percent in the year 2024.

11th ranked TRON (TRX) is the highest-ranking crypto to trade with overnight gains. TRX has added 0.55 percent overnight and 0.9 percent over the past week.

88th ranked Popcat (POPCAT) topped overnight losses with a decline of more than 14 percent. 63rd ranked Fantom (FTM) and 85th ranked Ethena (ENA) followed with losses of more than 13 percent. 66th ranked Celestia (TIA), 94th ranked Ronin (RON), 22nd ranked Pepe (PEPE) and 98th ranked Conflux (CFX) have all shed more than 12 percent in the past 24 hours.

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