Cryptocurrency Market Faces Downturn as Senate Passes Tax Bill
Leading cryptocurrencies like Bitcoin and Ethereum fell as tech stocks declined. Explore the market trends and investor sentiment.
On Tuesday, leading cryptocurrencies experienced a significant downturn, aligning with a similar decline in tech stocks, following the Senate's approval of President Donald Trump's extensive tax-and-spending bill.
Bitcoin (CRYPTO: BTC) saw a decrease of 1.85%, settling at $105,518.53. Ethereum (CRYPTO: ETH) declined by 4.03% to $2,395.09, while Dogecoin (CRYPTO: DOGE) fell by 4.72% to $0.1582. This decline indicates a notable shift in market dynamics as investors reacted to the legislative changes.
The cryptocurrency market witnessed Bitcoin reaching an intraday low of $105,157.40, coupled with a 6% increase in trading volume over the past 24 hours, highlighting a significant sell pressure. Ethereum also trended downward, hovering in the $2,400 region. This trend resulted in the erasure of more than $220 million worth of bullish longs, with total liquidations soaring to $258 million.
In terms of market positions, over $500 million in short positions faced a potential risk of liquidation if Bitcoin surged to $109,000. Bitcoin's open interest fell by 3.38% in the last 24 hours, while Ethereum observed a slight gain of 0.88%. An increase in open interest amid falling prices often indicates that more traders are entering short positions, betting on further declines.
The Crypto Fear & Greed Index, a popular tool for measuring investor sentiment, indicated prevailing 'Greed' in the market. This sentiment may have contributed to the recent volatility, as traders continue to navigate the uncertain economic landscape.
Stay informed and keep an eye on the market trends to better understand the evolving dynamics in the cryptocurrency world.