The cryptocurrency market has taken a hit in early morning trading, with major coins such as XRP and ether experiencing losses of up to 25% amidst global economic uncertainty.
Market Volatility Increases Amidst Global Economic Uncertainty
Stock markets across Asia and Europe have dropped, while the U.S. dollar has strengthened. This shift in global economic sentiment has had a ripple effect on the cryptocurrency market, with major coins such as ‘XRP‘ and ‘ether (ETH)’ experiencing losses of up to 25%.
The cryptocurrency market has experienced significant growth since its inception in 2009.
As of 2022, the global cryptocurrency market capitalization stands at over $2 trillion.
The market is dominated by Bitcoin (BTC), which accounts for more than 40% of the total market share.
Ethereum (ETH) and other altcoins have also gained popularity, leading to increased trading volumes and liquidity.
The decentralized nature of cryptocurrencies has made them attractive to investors seeking alternative assets.
Crypto-Focused Companies Take a Hit
The downturn in crypto markets has spread to stocks of companies focused on cryptocurrencies. Japan’s Metaplanet, often referred to as ‘Asia’s MicroStrategy‘ due to its significant bitcoin holdings, saw its shares fall by 9.44% on the Tokyo Stock Exchange.
Similarly, SBI Holdings, a leading crypto and blockchain venture fund, sank 3.60%. U.S.-listed Coinbase and MicroStrategy traded more than 5.9% lower in pre-market trading, while mining stocks MARA Holdings and Riot Platforms dropped 6%.
The ‘T-Rex 2x Long MSTR Daily Target ETF’ , which offers a 200% return on the daily performance of MicroStrategy, was down 9.6%. Pre-market trading is typically more volatile due to reduced liquidity.
Global Trade Tensions Contribute to Market Uncertainty
President Donald Trump‘s imposition of tariffs on imports from ‘Canada, Mexico, and China’ over the weekend has added to market uncertainty. The threat of taxes on the European Union further exacerbated the situation, leading to a decline in stock markets across Asia and Europe.
The strengthening U.S. dollar has also contributed to the downturn in crypto markets, with major cryptocurrencies such as ‘XRP‘ and ‘ether (ETH)’ experiencing significant losses amid a rush of capital from risk assets.
