The crypto market over the weekend has endured a rather shocking setback after prices of Bitcoin and other altcoin plunged in hours. This follows an entire week of extreme bullish activity in the market, only for the bull run to stop abruptly during the weekend owing to massive sell-off by hodlers.
The dip in the market reduced the crypto market value by eight percent and dropped BTC price by approximately $10,000. The dip also resulted in a significant drop in the value of the crypto market capitalization. It is now at $2.08 trillion.
The number one crypto fell to a low of $52,000 on Sunday, a dip from $61,271 the coin traded on Saturday. Altcoins‘ price fell alongside BTC, with ETH leading the drop by 11 percent to $1,978. The number one altcoin has recovered, however, and trades at $2,174 at Press time.
XRP also plunged by 20 percent after massive gains during the week, BCH also falling by 20 percent among other coins.
Why the sudden crash in crypto market?
Brewing rumor has it that authorities in the US are set to sanction several financial institutions for allegedly being involved in money laundering with crypto. The rumor pulled the trigger as several crypto holders began selling off their coins, leading to the plunge.
However, the US authorities are yet to confirm if or if not the rumors are true. However, there would be more setbacks for crypto prices when authorities eventually speak on the rumor, especially if it is true.
Another reason attributed to the dip in the market is the drop in the hash rate of miners, which went down by 30 percent. Local sources in China state that the plunge resulted from a power outage in China’s Xinjiang province, the region that houses China’s largest Bitcoin mining operations.
The sudden crash in prices over the weekend is another reminder of how volatile the crypto market is.