Bitcoin and Ethereum, two of the most dominant cryptocurrencies, have recently experienced a significant drop in their prices. This downturn comes amidst growing global recession fears, which have notably affected the financial market, including cryptocurrencies. Bitcoin, which is often regarded as “digital gold” due to its potential as a store of value, fell by over 10%, while Ethereum saw a decline of around 20%. This situation has led to the liquidation of billions of dollars in futures contracts on major exchanges around the world.
The market plunge was intensified by mass liquidations, where traders were forced to sell off their assets to cover their losses or to prevent further losses. The liquidations were particularly felt in the futures market, a platform where traders can bet on the future prices of cryptocurrencies. The market downturn has brought into question the correlation between cryptocurrencies and traditional financial markets, as well as the role of digital assets as a potential safe haven in times of economic uncertainty.
