Bitcoin (BTC) continued its bearish price action for the third straight day, with the leading cryptocurrency falling to a one-week low of $21,814 today, according to data from CoinMarketCap.
After a brief rebound, Bitcoin is now changing hands at around $21,785 apiece, down 6.9% on the day despite a 7.69% increase in daily trading volume.
Bitcoin’s market cap has more than halved, falling from $1.27 trillion last November to under $417 billion today.
Ethereum, the second largest cryptocurrency by market cap, is also down around $1,728, down 6.2% over the past 24 hours.
With a current market cap of $211.5 billion, ETH is down 64.49% from its all-time high of $4,891 recorded in November, according to data from CoinMarketCap.
Amid the bearish price action, over $537 million was liquidated by 156,155 traders in the crypto market over the past 24 hours, according to Coinglass data.
Bitcoin leads liquidations at $201.3 million, followed by Ethereum at $132.7 million over the same period.
The vast majority of liquidations for the top two cryptocurrencies have come from blown out long positions.
Other cryptocurrencies including Binance Coin (8%), Solana (11.6%), Polygon (11.85%) and Avalanche (14.3%) have also seen huge losses over the past 24 hours, according to CoinMarketCap.
Bitcoin, Ethereum react to the Fed
The market’s bearish price action is likely related to the Fed’s expected rate hike next month and reduced DeFi activity.
The Wall Street Journal reports that St. Louis Fed President James Bullard is in favor of a 0.75% rate hike by next month. San Francisco Fed Chair Mary Daly also confirmed a 0.50% or 0.75% rate hike next month, as reported by Portal.
Both have confirmed that interest rates could be raised as long as rising inflation is controlled.
User activity across all DeFi applications on Ethereum has also been negative over the past week following concerns about the upcoming merger event.
According to data from Dune Analytics, the decentralized exchange (DEX) trading volume is down 34% in the last 24 hours.
According to data from DefiLlama, the total locked value (TVL) across all blockchains has fallen by over 3.75% in the last 24 hours, indicating lower user interest in DeFi.
Disclaimer
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.