The cryptocurrency market faced a horrible downfall, which caused huge crypto market liquidations of $1.2 billion in 24 hours. And as Bitcoin lost about $108,000 from its peak, a chain reaction is visible among the major cryptocurrencies. After Federal Reserve Chairman Jerome Powell‘s concerning statements on inflation projections, the market was very quick to decline sharply to this news.

Key-Takeaways:

• The $1.2 billion in crypto market liquidations happened within a single day while Bitcoin declined from its peak of $108,000 to $97,000.
• The ones critical to bitcoin were the statements of Federal Reserve Chair Powell, who mentioned that rates would remain high for an extended period, and inflation remains a worry.
• Meme coins were the hardest hit, with Dog fostering a 20% dip and others such as Shiba Inu and Bonk by more than 22%.
• Longs was again responsible for most of the losses totaling $1.07 billion, though Binance saw the largest single liquidation order at $16 million.

Major Cryptocurrencies Faces Huge Loss

Bitcoin falls to $97,000; a 7% drop sends ripples across the crypto market. Ethereum could not hold its position, and it dropped by 12% to $3,422. Another key player in the market couldn’t dodge the bear and fell below $200, reaching $191.

During this market correction, the meme coin sector was even hit with steeper declines. Dogecoin has plummeted by nearly 20 percent to $0.31, while it still holds a massive $46.6 billion market cap. Just like Shiba Inu and Bonk, other meme coins suffered similar fates with losses of over 22%.

Federal Reserve’s Impact on Crypto Markets

The recent comments of Jerome Powell about persistent inflation have sent the markets into a spin. Many traders sold crypto holdings after his suggestion that interest rates might remain higher for longer than the market anticipated. It showcases how cryptocurrency is becoming some form of link between traditional financial markets.

Crypto exchanges saw major activity as a result of the market turmoil. The $1.07 billion of total losses were borne by long positions. The largest single liquidation order by value was $16 million at Binance, a major cryptocurrency exchange that also had $83 million in outflows.

All sectors of the broader cryptocurrency market declined 9%. Cardano and XRP’s price dropped 15.7% and 11%, respectively, to $2.22. Despite what has been little more than a market-wide selloff, some cryptocurrencies have found their footing. Interestingly, Fart Coin was able to garner exceptional rates of weekly gains at 71% and monthly gains at 323%.

Market’s Reaction towards this Impact

The crypto market is currently in a bearish mood, which means more liquidity problems. Investors still appear cautious about conditions as Bitcoin trades below $100,000. But analysts are still watching the signs of recovery or further decline.

During this market correction, alternative cryptocurrencies were experiencing significant pressure. Established and emerging crypto coins were both subject to widespread selling. The volatility of their market meant trading volumes spiked up on all platforms, and there was also a lot more activity in their market.

Conclusion: Crypto Market Liquidations

This is a reminder to cryptocurrency that it has a very volatile nature and sensitivity to macroeconomic factors. Some investors are taking this as an opportunity to buy, while others are maybe a little more cautious with market conditions. Short-term crypto market trajectory is being shaped by response to the economic indicators.