Bitcoin (BTC-USD), the world's most valuable cryptocurrency, started this Monday on a bearish note, dropping to as low as $25K. The decline persisted throughout the day, with the cryptocurrency sliding 2.6% to $25.1K in midday trading. This is the lowest level Bitcoin has reached since mid-June, continuing a trend of low trading volumes and volatility.
Other major tokens also recorded intraday losses, including Ethereum (ETH-USD) -3.7%, Solana (SOL-USD) -2.2%, Cardano (ADA-USD) -2.3%, and XRP (XRP-USD) -4.9%. Consequently, the global crypto market cap sank 2.6% to $1.01T, according to data from CoinMarketCap.
This downturn in the crypto market contrasts with modest gains in the stock market ahead of a data-packed week, with the Dow Jones up 0.1%, S&P 500 +0.3% and tech-heavy Nasdaq +0.6%.
Matteo Greco, research analyst at digital asset and fintech investment firm Fineqia International, confirmed the low volatility trend in a note, stating that despite strong fluctuations observed during the second week of August accompanied by almost an 11% decrease in price for BTC, the annualized volatility of BTC on a 30-day basis remains at one of the lowest levels ever recorded.
Trading activity typically dips during summer, according to Greco. However, recent interest-rate hikes by the Federal Reserve have further impacted liquidity. In its August Exchange Review, CCData reported an 11.5% decline to $2.09T in combined crypto spot and derivatives trading volume on centralized exchanges, marking the lowest combined monthly trading volume this year and the second-lowest since October 2020.
Crypto-linked stocks also experienced downward pressure, with notable losses including Marathon Digital (NASDAQ:MARA) -7.2%, Riot Platforms (NASDAQ:RIOT) -7.1%, BIT Mining (NYSE:BTCM) -5.9%, and Bitfarms (NASDAQ:BITF) -5.7%.
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