Today, the global cryptocurrency market is experiencing a significant decline, due to several important factors:
1. Rising US bond yields:
Analysts link the recent decline in cryptocurrency prices to rising US government bond yields, which show a decline in liquidity in financial markets. This in turn reduces investors’ appetite for investing in riskier assets such as cryptocurrencies.
2. The US dollar is showing increasing strength:
The US dollar has seen positive rebounds from its previous lows, pushing investors towards safer investment instruments such as the dollar instead of cryptocurrencies. This effect is known as the rise of the US dollar index (DXY).
3. Massive liquidations of long positions:
The market has seen liquidations estimated at hundreds of millions of dollars, as traders in the market were forced to abandon long positions due to losses, which increased downward pressure on the market.
4. Negative effects of rumors about the Binance exchange and FTX events:
Rumors related to liquidity problems and the bankrupt FTX exchange have hurt market sentiment. Binance itself has become the subject of rumors, which has increased investor anxiety and led to a flight to safer investments.
All of these factors combined show a state of anxiety in the market.
