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- The price of Bitcoin reflects the stock market crash, dropping to its lowest point since mid-July, nearing $62k on August 1.
- Stocks fell sharply as investors responded to recent economic indicators and rising geopolitical tensions in the Middle East.
- On Thursday, Bitcoin’s price plummeted by 10%, approaching $62k, marking a difficult start to August for both cryptocurrencies and stocks.
On August 1, the total market capitalization of cryptocurrencies worldwide decreased to $2.3 trillion, following an overall decline of 5.7%. Bitcoin reached lows of $62,300 across major crypto exchanges. This downturn also affected Ethereum, which fell to around $3k, and Solana, which sharply declined to approximately $160.
XRP, Dogecoin, and Pepe also saw significant drops.
Why Did Bitcoin, Crypto Prices Fall Today?
The downturn in the crypto market coincided with a significant drop in the stock market, where the Dow Jones Industrial Average lost over 600 points and the S&P 500 decreased by 1.5%.
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As reported by CNBC, the turmoil in stocks is attributed to renewed investor concerns regarding potential economic contraction following weak data released on Thursday.
The market’s response also follows the Federal Reserve’s FOMC meeting on Wednesday, although analysts suggest that the market has already accounted for a potential rate cut in September. Additionally, geopolitical tensions in the Middle East were a concern for investors.
What Next For BTC, Crypto?
In discussing the broader outlook prior to the significant sell-off, analysts from Singapore-based QCP Capital remarked:
“Crypto faced a widespread sell-off overnight and into this morning. The market continues to be unsettled as traders closely monitor daily ETH ETF outflows and additional supply pressures from Mt Gox and the U.S. government.”
QCP indicated that the long-term outlook for Bitcoin remains positive. Significant catalysts could include the upcoming U.S. election and the pursuit of a sovereign Bitcoin reserve for the United States.
“The establishment of a U.S. or sovereign ‘put’ on BTC prices could have considerable implications, potentially making accumulation during dips a strategic investment strategy,” QCP Capital added in a note shared on Telegram.
