The new COVID-19 variant coming from South Africa has brought more pain to all financial markets. As the futures contracts of the world’s most prominent stock indexes have slumped, the cryptocurrency space experienced a massive correction. Bitcoin dumped to a six-week low, while some altcoins saw double-digit price drops.
Bitcoin and Global Markets Tumble
The primary cryptocurrency was on its way towards $60,000 yesterday after recovering from the previous drop below $56,000. It came roughly $500 away from challenging that coveted level, but it failed, and the landscape changed vigorously hours later.
Bitcoin dumped by $5,000 in a few hours to an intraday low of $54,300, which became the lowest price point since October 13th. As reported earlier, this enhanced volatility caused mass pain for leveraged traders as the liquidations skyrocketed to over $700 million on a daily scale.
BTCUSD. Source: TradingView
This price crash coincides with similar developments in the global stock markets. Prompted by fears of a new COVID-19 variant coming from some African nations, the futures contracts of Dow Jones, the S&P 500, Nasdaq, and other popular indexes plummeted.
The Dow’s futures are down by more than 2%, those for the S&P 500 by nearly 1.7%, while oil prices dropped even harder. US crude oil futures declined by over 5.5%.
The situation in Asia is identical, with Japan’s Nikkei and the Hong Kong Hang Seng losing around 2% each.
Altcoins Have it Worse
As it usually happens when bitcoin heads south, so do the alternative coins. Ethereum exceeded $4,500 yesterday at one point, but a substantial correction of over $400 has driven it south below $4,100 as of now.
Binance Coin traded north of $610 but it’s down to $580 now. Solana (-6.5%), Cardano (-5%), Ripple (-7%), Polkadot (-8.5%), Dogecoin (-7%), Shiba Inu (-2%), and Litecoin (-9%) are deep in red as well.
Avalanche and CryptoCom’s token have lost the most from the larger cap alts. AVAX has dumped by 12% to below $110, while the recent high-flyer CRO has plummeted by more than 20% and sits beneath $0.7.
The crypto market cap is down by nearly $200 billion in a day to below $2.5 trillion on CoinMarketCap.