Amman Global Assets Sell-Off Sends Bitcoin Plunging Over 16%, Crypto Market Bathed in Blood

Amman Global Assets Sell-Off Sends Bitcoin Plunging Over 16%, Crypto Market Bathed in BloodOn August 5th, the crypto market suffered a bloodbath. Bitcoin prices, after breaking below $54,000 in the morning, faced another wave of selling in the afternoon, briefly dipping below $50,000

Amman Global Assets Sell-Off Sends Bitcoin Plunging Over 16%, Crypto Market Bathed in Blood

On August 5th, the crypto market suffered a bloodbath. Bitcoin prices, after breaking below $54,000 in the morning, faced another wave of selling in the afternoon, briefly dipping below $50,000. The intraday decline exceeded 16%. As of press time, the drop has narrowed to around 12.6%. Data shows that over the past 24 hours, more than 278,000 traders were liquidated, resulting in a total liquidation amount of approximately $1.06 billion, with long positions far exceeding short positions.

Bitcoin's fall also dragged down other virtual currencies. Ethereum (ETH) saw a decline of over 20% in 24 hours, dipping below $2,200, hitting a new low in recent months. As of press time, ETH has recovered to around $2,300. SOL briefly fell below $120, currently holding at around $123, with a 24-hour drop exceeding 12%. BNB dropped below $450, experiencing a 24-hour decline of over 15%.

According to Jeffrey Ding, Chief Analyst at HashKey Group, over $500 billion has vanished from the market since August 2nd, marking the largest three-day sell-off in nearly a year. Among the top 10 coins by market capitalization, Solana has been hit hardest, declining over 30% since July 30th.

Macroeconomic Factors Fuel Market Panic

Jeffrey Ding believes that unfavorable macroeconomic factors have exacerbated market panic. Asian equities opened lower on Monday, carrying over Friday's US stock market plunge. The S&P 500 index fell to its lowest point since October 2022 following weak employment data. Japanese stocks led the decline, as the market expects the Bank of Japan to raise interest rates further.

Market concerns about the Fed's decision to keep interest rates unchanged, potentially leading to further economic slowdown, coupled with the deteriorating Middle East situation, have considerably weakened market sentiment. Saudi Arabia raised the price of its flagship crude oil exports to Asia for the first time in three months, driving up oil prices. Goldman Sachs increased the risk of a US recession next year from 15% to 25%.

Traders may soon shift their attention to China's Caixin services and composite activity data to gauge the health of the world's second-largest economy. China also released 20 measures to stimulate consumption over the weekend.

"Predicting a volatile week ahead, with heightened tensions in the Middle East and resurfacing recession fears, investors are likely to remain in 'risk-averse' mode. This week, the Reserve Bank of Australia's policy meeting, US economic activity and credit data, and regional Fed officials' speeches will also be closely watched," Jeffrey Ding remarked.

Large Crypto Liquidations Accelerate Decline

According to Foresight News, Arthur Hayes, co-founder of BitMEX, posted on social media that he learned through traditional finance channels that a "big guy" had gone down and sold all their crypto assets. The majority of the community currently speculates that he is referring to Jump Crypto.

EmberCN's analysis released yesterday indicated that Jump Trading may be selling ETH, recently redeeming a batch of wstETH (120,000 pieces) valued at $410 million, converting it into ETH, and transferring it to platforms like Binance/OKX.

As of yesterday, Jump Trading has redeemed 83,000 wstETH into 97,500 ETH over the past nine days starting from July 25th. Among them, 66,000 ETH (approximately $191 million) have already entered the trading platforms. According to Scopescan monitoring, Jump's current position is now dominated by USDC and USDT.

In addition, the market, pressured by heavy selling, witnessed multiple large liquidations and on-chain liquidations today. Earlier this morning, four whales faced forced liquidation of leveraged positions due to a rapid price drop, resulting in a collective loss of 14,653 ETH, equivalent to approximately $33.54 million.

Parsec data shows that DeFi lending liquidations surpassed $320 million in the past 24 hours, setting a new high for the year. Centralized exchanges also experienced large liquidations. A Binance user experienced a single long position liquidation of $10.90 million at 10:17 AM today when the Ethereum price was $2,197, with the contract trading pair being ETH/USDC.

Market liquidations of leveraged positions continue to fuel selling pressure, causing significant declines in the crypto market.

The Future Market Outlook Remains Uncertain

Currently, the crypto market faces multiple challenges, including macroeconomic uncertainties, regulatory risks, and declining market confidence.

The deteriorating macroeconomic environment has intensified investors' aversion to risk assets, leading to capital flight from the crypto market. The Fed's interest rate hikes and persistent high inflation have created uncertainties for global economic growth, potentially causing investors to favor safe-haven assets like gold and the US dollar.

Moreover, regulatory risks have also posed pressure on the crypto market. Governments worldwide are intensifying regulations on the crypto market, which may lead to restrictions on the circulation of crypto assets, potentially impacting market development.

Lack of market confidence is another challenge facing the crypto market. Recent large crypto liquidations and the bankruptcy of certain crypto companies have heightened investor concerns about the market outlook.

Despite numerous challenges, the crypto market still holds immense growth potential. With ongoing technological advancements and expanding application scenarios, the crypto market is poised to welcome new development opportunities.

In Conclusion

Amman's global asset sell-off has sent Bitcoin plunging over 16%, leading to a bloodbath in the crypto market. Macroeconomic factors have fueled market panic, while large crypto liquidations have accelerated the decline. The future market outlook remains uncertain, and investors need to exercise caution in their investments.

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Keywords: Bitcoin, Cryptocurrency, Flash Crash, Liquidation, Macroeconomics, Regulatory Risk, Market Confidence, Investment Risk