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Market drop due to Chinese restrictions
The total market capitalization of cryptocurrencies and Bitcoin (BTC) has experienced a significant decline today. Bitcoin dropped to below the support level of $105,000 during its daily trading lows. This decline is attributed to China's imposition of a new ban even on merely owning cryptocurrencies.
The Optimism (OP) coin also fell by 9.3%, leading the losses among alternative coins in this context.
The total market capitalization of cryptocurrencies decreased by $61 billion over the past 24 hours, reaching $3.30 trillion. This drop broke the key support level at $3.31 trillion, indicating increased short-term volatility.
This decline followed China's renewal of its restrictions on owning cryptocurrencies, exacerbating previous limitations imposed on mining and trading. Despite these selling pressures, it is expected that the pace of decline will weaken soon, potentially giving the market capitalization a chance to regain the support level at $3.31 trillion.
However, if the panic selling wave escalates, it could lead to mass liquidations, which may push the market capitalization of cryptocurrencies down towards the $3.21 trillion level, increasing the risks that investors face.
