Crypto market turmoil entered the third week of September as most cryptocurrencies started the week on a bearish note. The total cryptocurrency market cap has fallen below $1 trillion again, with many cryptocurrencies recording a double-digit decline in the past 24 hours.
The ongoing bearish turmoil has resulted in nearly half a billion liquidations for leveraged cryptocurrency traders over the past 24 hours. Data from Coinglass shows that 130,087 traders were liquidated, with a total liquidation value of $431.51 million. Bitcoin (BTC) leveraged traders lost $44.5 million, followed by Ether (ETH) traders with a total liquidation of $8.39 million.
Long traders have made quite a bit of losses on the majority of the exchanges with the average difference between the long and short liquidation amount being 10x.
Liquidation on different exchanges Source: Coinglass
The current market turmoil is attributed to several macroeconomic factors, including the recently released CPI data on September 13 which showed that inflation has not abated yet. The price of BTC dropped nearly $1,000 within minutes of the release of the CPI data. Since then, the market has shown some desire to rally over the weekend, but saw another bloodbath earlier on Monday.
Higher CPI data is expected to be followed by the Fed’s rate hike at the next meeting scheduled for September 21st. Market experts predicted that the rate hike could be the biggest in 40 years as a measure to control spiraling inflation.
According to the CME FedWatch Tool, the market has now priced the entire fed funds rate hike at a minimum of 75 basis points and does not rule out the chances of a 100 basis point. The 100-point increase would be the Fed’s first such action since the early 1980s.
Related: Here’s Why the Fed’s 0.75% Rate Raise Could Be Bullish for Bitcoin and Altcoins
The recently completed Ethereum Merge was also blamed as a rumor buying and news selling event, with the price of Ether (ETH) rising to $2,000 in the run-up to the merger, but now dropping to $1,300 after the merger.
As the stock and cryptocurrency markets experience a similar downtrend, famous trader Clark was quick to point out the similarities between current market conditions and those of the 1970s.
Clark indicated in his tweet that the market could turn bullish again towards the end of the year in November and December. Hence, the cryptocurrency market may see another bullish run along with the stock market at the end of 2022.
