Cryptocurrency prices took a hit on Thursday as traders began to sell off their positions following recent gains. Bitcoin, which failed to reach its record high above $73,700, dropped below $71,000, marking a 2% decrease in the past 24 hours.
In addition to Bitcoin’s decline, other cryptocurrencies also saw losses. Ethereum’s ether (ETH) fell by 6%, while altcoins like aptos (APT) and render (RNDR) each slid by 5%. The overall CoinDesk 20 Index was down by 2.8%. Bitcoin’s dominance in the market, which measures its share of the total crypto market capitalization, reached a three-year high of 60.2%.
The downward trend in cryptocurrency prices coincided with a significant drop in U.S. stock prices. The Nasdaq and the S&P 500 were 2.3% and 1.5% lower, with tech giants Meta (META) and Microsoft (MSFT) leading the decline after disappointing earnings reports.
Stocks of companies linked to digital assets also suffered losses. Coinbase’s (COIN) shares fell by 7% after missing earnings targets, while Robinhood (HOOD) dropped by 13%. Bitcoin mining companies like MARA Digital (MARA), Riot Platforms (RIOT), and Cleanspark (CLSK) saw declines of 5%-10%. However, MicroStrategy (MSTR) performed relatively better, only dipping by 2.5% after announcing a capital raise plan to purchase more bitcoin.
Geoffrey Kendrick, the head of research of digital assets at Standard Chartered, warned of potential position unwinding ahead of the upcoming U.S. election. Despite this, Kendrick believes that any dip in prices would be temporary, with a potential for prices to rise post-election, regardless of the results.
According to Kendrick’s report, a Republican sweep in the election would be the most bullish scenario for digital assets. The bank has set a year-end bitcoin price target of $125,000 and believes that altcoins like solana (SOL) could benefit from a friendlier regulatory environment.
It is important to note that CoinDesk is a reputable media outlet that covers the cryptocurrency industry with integrity and editorial independence. Their journalists adhere to strict editorial policies to ensure unbiased reporting. CoinDesk is part of the Bullish group, which invests in digital asset businesses. Journalists at CoinDesk may receive compensation in equity from the Bullish group.
Overall, the recent decline in cryptocurrency prices reflects a broader trend in the market, influenced by factors such as stock market performance and upcoming geopolitical events like the U.S. election. Investors should exercise caution and stay informed about market developments to make well-informed decisions regarding their cryptocurrency investments.
