By Nathan Ferguson
Fears of a cryptocurrency market crash grow in the community as bears dominate the space. Bitcoin struggles with lows at this publication, trading hands at $40,173.62, dropping 0.16% over the past day. Meanwhile, Ethereum traded at $3,057.06, following a brief 0.95% 24hr surge. Notably, the crypto market lost nearly $300 billion over the last week.
Bloomberg analysts noted a record high correlation between the NASDAQ index and BTC price amid price drops. An expert commented on the 40-day high correlation. He stated that the increase erodes the narrative that BTC is a ‘diversifier.’ Remember, proponents have used this argument for the asset’s appeal.
The BTC-NASDAQ correlation chart raised concerns about an emerging setup in recent months. A sell-off momentum accompanies the pattern as the markets responded to Fed’s interest rate hikes.
Another outstanding reflection is NASDAQ and BTC have displayed massive correlation signals since 2020.
Anthony Pompliano, a crypto analyst, attributes that to the shift in BTC investors’ holder base.
He trusts two major groups hold BTC at the moment. First and foremost, there’s the Wall Street space that takes BTC as the riskiest asset they own. Then, some everyday investors invest in the currency as a reserve product.
BitMEX co-founder Arthur Hayes presented similar views about the surging NASDAQ-Bitcoin correlation. He stated that many crypto pundits believing the worst is over ignore the truth that cryptocurrency prices currently reflect NASDAQ 100 and S&P 500 reactions.
About BTC Increasing Liquidation
Pompliano said some holders consider BTC as their risk asset, while others take Bitcoin as a reserve asset. Crypto Whale, an anonymous Twitter handle, posted about the latest drastic crypto market liquidations to its over 450K followers.
Crypto Whale stated that the cryptocurrency space saw liquidations worth more than $460 million over the past day, over 90% coming from long positions. Such data indicates a feeble market that might crash soon.
The global market capitalization hovered with a slight overnight uptick at $1. 87 trillion. The upside momentum remained weak, and downtrends appeared possible in the coming sessions.