If you're wondering why is crypto down today then here's a look at what's happened.
After a fairly positive end to 2021, the crypto market suffered from various crashes and incidents in 2022. Whether the Luna crypto crash or the plethora of hacks that have happened this year, prices have trended downwards.
And now, the entire cryptocurrency market cap has dropped 5.3% and is currently at $987 billion. Bitcoin is down 5.2% while Ethereum is down 8.2% in the last 24 hours, respectively. Aside from the mainstream Ethereum news and bitcoin news, several cryptocurrencies have reported slight price drops over the past few days, So, what explains the most recent crypto market crash in September 2022?
Why Is The Crypto Market Down September 2022
One reason why the crypto market is down today in September 2022 comes from holders' fears relating to inflation. While Bitcoin and crypto, in general, are often described as a hedge against inflation, this has not been the case since larger investors have been onboarded.
While many in the cryptocurrency space see their investments as separate from the traditional stock market, major events still can impact their prices.
As traditional stocks continue to slide amid this inflation, so too has the crypto sell-off, with these often riskier assets being dumped as the bear market continues.
Alongside this, the various looming threats about further cryptocurrency regulation, both relating to Luna now that Luna 2.0 has launched and other crypto-related projects, are sure to place doubt in some holders' minds.
The crypto market has also been further damaged today by reports of the Celsius network halting withdrawals, and Coinbase bankruptcy rumours, stoking fears of its liquidity crisis.
Meanwhile, the Tron-backed stablecoin USDD threatens to depeg, drawing links to the TerraUSD collapse due to USDD's algorithmic stablecoin identity. Furthermore, the recent issues such as the Acala depeg, Tornado Cash banning might also add more fuel to the current crypto state of affairs.
Of course, for some, crashes and bear markets offer the chance to buy the dip. SHIB holders have boasted about buying the dip, for example, while the Shiba Inu price added an extra zero.
As the prices of Bitcoin sway back and forth, Bitcoin's latest descent below $20,000 came after Fed chair Jerome Powell's speech in August 2022. Powell in his speech shared that the inflation rates may not go down anytime soon, triggering Bitcoin to fall below $20,000.