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Bitcoin, Solana, Ethereum Tumble: Here’s Why Crypto Markets Are Down Today
- Major cryptocurrencies experienced significant losses with Ethereum dropping 7.5%, Bitcoin falling 5%, and Solana declining 7.2% in response to stronger-than-expected US economic indicators.
- The market downturn triggered widespread liquidations totalling US$542.1 million, with Ethereum leading at US$117 million, compared to Bitcoin’s US$99 million in forced sales.
- Analysts view this correction as a potential buying opportunity while emphasising the importance of emotional control during market dips.
Bitcoin has dropped 5% over the past day, with most of the crypto market in the red. While the largest crypto by market cap had the biggest drop in dollar terms – falling from US$102,425 (AU$164,231) to US$97,049 (AU$155,613) – others in the top ten suffered larger percentage losses.
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Ethereum (ETH) dropped by 7.5%, XRP lost 4.3%, dropping a rank in market cap, and Solana lost 7.2%.
BTC, ETH, SOL and DOGE Suffer Largest Liquidations
The mini-crash has caused 171k traders to be liquidated with a total liquidation volume of US$542.1 million (AU$869.1 million) according to data from Coinglass. Remarkably, Ethereum liquidations accounted for a larger portion of the total liquidations compared to Bitcoin.
Ether experienced forced sales to the tune of US$117 million (AU$188 million) while only US$99 million (AU$159 million) of Bitcoin had been liquidated. Solana and Dogecoin also suffered sizable liquidations with US$24 million (AU$38.6 million) and US$23 million (AU$37 million) respectively.
As is often the case, data from the United States seems to be behind the sell-off.
Job openings unexpectedly increased in November while service sector activity strengthened in December, which contributed to an edgy bond market as expectations for further rate cuts ease.
Of course, this is not entirely unexpected, as 10X Research predicted volatility around the upcoming CPI release on January 15.
Retest Could Be Volatile, Says Analyst
So, is now a good opportunity to buy the dip? According to crypto analyst Michaël van de Poppe, it is, if you’ve done your research.
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The analyst believes, as the crypto market is maturing, corrections can be valuable opportunities for investors. And while dips are common in bull markets, it’s important to manage one’s emotions.
During those 10% corrective days, don’t let your emotions take control, do the opposite. For now: hold and add on dips, if you can.
Michaël van de Poppe Fellow analyst RektCapital posted on X (formerly Twitter) that the current retest phase “may be a volatile one”, adding:
A Daily Close above $101,165 (black) is needed to confirm a successful retest.
RektCapital 
Author
Aaron Feuerstein
Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.
