Cryptocurrencies experienced a decline on Thursday, as bitcoin (BTC) dropped below $25,000 and ETH, XRP, and ADA extended their 24-hour declines, reaching a maximum of 7.4%. According to data from CoinMarketCap, the total market capitalization decreased by 3.5% within the past 24 hours.
There are indications of potential further declines, as some traders suggest that Bitcoin could reach as low as $23,500 based on price-chart analysis. Alex Kuptsikevich, a senior market analyst at trading firm FxPro, highlighted that bitcoin has retraced to local resistance levels from August last year to February this year.
In this context, a descending channel represents a bearish trend in which prices make lower highs in short-term time frames. Kuptsikevich added that significant support for Bitcoin can be found near the 200-day average, currently at $23.6K and trending upward.
ADA’s decline has resulted in a decrease of more than 22% in the past week, following its classification as a security in a U.S. Securities and Exchange Commission (SEC) lawsuit against crypto exchanges Binance and Coinbase, along with 12 other tokens.
XRP also erased all gains from an earlier surge this week as the market absorbed the “Hinman emails” released in connection with the SEC’s lawsuit against Ripple. These emails, from William Hinman, a former director of the SEC’s Division of Corporation Finance, contributed to market sentiment.
Ether (ETH) posted a 6.6% drop within the 24-hour period, while futures tied to Ether saw the highest liquidations among major cryptocurrencies, amounting to $57 million out of a total of $143 million across all crypto-tracked futures. Liquidation occurs when an exchange forcefully closes a trader’s leveraged position due to insufficient margin funds, which may indicate a local top or bottom of a significant price movement.
Market sentiment was further affected by general bearish sentiment and an abnormal increase in the selling of tether (USDT) stablecoin on the decentralized finance (DeFi) protocol Curve Finance. Balances of USDT on Curve’s popular 3pool, which includes USDT, USDC, and DAI, rose to over 72% early on Thursday, suggesting that traders exchanged substantial amounts of USDT for USD coin (USDC) and dai (DAI).
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