The crypto market has suffered heavy losses in the last 24 hours. After a strong January, we already saw prices stabilizing in the first few days of February. But in the last few days and especially in the last few hours, cryptocurrency prices have fallen sharply. What are the reasons for the crypto market slump? Why are Cryptos down? Here are our top 3 reasons.
How did Cryptos Perform recently?
In the last 24 hours, cryptocurrency prices have fallen more sharply. After the prices in January could still rise between 30 and 80 percent depending on the coin, the losses in the last few days were already visible. In the last 7 days, Bitcoin price has lost over 8%. With Ethereum, it was also 8% and with Cardano even 10%.
In the last 24 hours, there was another sharp drop in prices. The Bitcoin price had to accept a crash below the $ 22,000 mark. BTC lost about 4% in the last 24 hours. This was followed by the courses of the other cryptocurrencies. Ethereum alone has gained more than 6%.
Why are Cryptos Down?
The recent losses in cryptocurrency exchange rates were due to various reasons :
1. Failure to break through resistance
The Bitcoin price has tried several times in the last few days and weeks to break through the $ 23,000 mark. The price briefly rose to $24,000 but failed to break the resistance.
If bitcoin fails to break through a resistance multiple times, the likelihood of the market selling increases. This also happened this year and the Bitcoin course saw a relapse, which caused the prices of other cryptocurrencies to drop.
2. Kraken discontinues staking service
Most of the time, bitcoin price history brings with it a situation where a drop becomes more likely. In this situation, you still need a trigger that ensures stronger sales. This trigger was the discontinuation of the staking service at the crypto exchange Kraken.
This discontinuation affects the US customers of the platform. Because the American securities regulator SEC accused Kraken of unregistered securities trading. As a result, the crypto exchange has now suspended service in the United States and had to pay a $30 million fine.
3. Increase in key interest rates by the ECB
The decisions of the central banks have had a major impact on the Bitcoin price and the prices of other cryptocurrencies, especially in 2022. It was above all the interest rate hikes by the US Federal Reserve that damaged the prices.
A few days ago, the European Central Bank (ECB) raised the key interest rate for the euro in order to combat inflation in the EU. This shows that the ECB wants to go the way of the FED and strengthen the FIAT currencies again. This probably also had an indirect effect on the prices of cryptocurrencies.
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