Bitcoin experienced a steep decline on Thursday and Friday, dropping below the critical $20,000 mark to $19,966.30—an 8.06% loss. Other major cryptocurrencies followed suit, with Huobi Token plunging 21%, Tron (TRX) down over 12%, Dogecoin losing 8.12%, and Ethereum declining 7.72%.
Market-Wide Liquidation and Investor Impact
Coinglass data reveals the cryptocurrency market saw approximately $307 million in liquidations within 24 hours. Of these, $282 million were long positions (bets on price increases), surpassing the previous record set on February 8 ($254 million).
👉 Why are cryptocurrency liquidations so volatile?
Key Statistics:
- Affected traders: 80,000 accounts liquidated
- Lost funds: $390 million (~¥2.72 billion) evaporated
- Total crypto market cap: $977.15 billion (6.8% decline)
- Dominance: Bitcoin (40.2%), Ethereum (17.7%)
Contributing Factors to the Crash
- Macroeconomic Pressures:
Federal Reserve Chair Jerome Powell signaled potential 50-basis-point rate hikes and higher terminal rates to curb inflation, spooking risk assets. - Banking Sector Collapse:
The shutdown of crypto-friendly Silvergate Bank exacerbated fears. After delayed financial reports and client withdrawals, its parent company announced voluntary liquidation on March 8.
Crypto-Linked Stocks Tumble:
| Company | Stock Decline |
|---|---|
| MicroStrategy | 9.4% |
| Coinbase | 7.8% |
| Block (Square) | 5.3% |
FAQs: Understanding the Drop
Q: Why did Bitcoin fall below $20,000?
A: Combined effects of aggressive Fed policy, Silvergate Bank’s collapse, and cascading liquidations triggered panic selling.
Q: How long might this downtrend last?
A: Historically, crypto markets recover after macroeconomic clarity, but short-term volatility remains high.
Q: Should investors avoid altcoins now?
A: Diversification and risk assessment are crucial—altcoins often mirror Bitcoin’s trends but with amplified swings.
👉 How to safeguard your crypto portfolio during downturns
Conclusion
The cryptocurrency market faces intensified pressure from traditional finance disruptions and regulatory uncertainties. Investors should monitor Fed decisions and broader economic indicators while practicing disciplined risk management.
Note: This content is for informational purposes only and not investment advice.
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