There has been a significant sell-off in the crypto space over the past 24 hours, with Bitcoin falling nearly 9%.
Meanwhile, Ethereum declined by 10% at some point:
The correction was widespread, and cryptocurrencies such as Solana, Binance Coin, and Cardano also suffered losses.
The total market capitalization of cryptocurrencies has fallen below $3 trillion. Earlier, it was at $2.8 trillion. One of the reasons for the rollback was the statement of the National Development and Reform Commission (NDRC) of China that the continuation of the fight against mining is included in its plans, and in the state plans.
The second reason in parallel to China's statement was the strengthening of the US dollar on expectations that the Fed will raise the interest rate at the beginning of next year by at least 1.5%. Moreover, the yield of 5-year treasury bonds has almost doubled since the beginning of August.
Investors began to shift their funds simply into capital, reducing positions in other assets.
China's harsh measures against mining and trading cryptocurrencies led to the collapse of the cryptocurrency market earlier this year.
Nevertheless, the pullback did not cause much panic in the crypto space. It seems that both Bitcoin and Ethereum have found their bottom.
OANDA's Senior Market Analyst Craig Erlam said that the $ 60,000 level acts as solid support right now, just $ 9,000 off Bitcoin's recent new all-time highs.
But if Bitcoin declines below this level of $ 60,000, the analyst warned that it could face a larger sell-off.
Well-known economist Mohamed El-Erian reported this week that he bought Bitcoin a few years ago when it was worth $ 3,000, and then sold it at a price of $ 19,000 a few months before it reached $ 60,000.
El-Erian added that as soon as speculation disappears from the market, he will buy it again.
