Bitcoin and Ethereum Prices Fall Amid Market Sell-Off

A significant sell-off in the cryptocurrency market has led to declines in Bitcoin and altcoin prices.

Bitcoin (BTC) has dropped to around $56,000, reflecting a 3.7% decrease in the past 24 hours, before rebounding to $56,800. Ethereum (ETH) has fallen to $2,400, a 3.9% drop.

The recent downturn is linked to a US Department of Justice probe into Nvidia and a broader decline in US stock markets. Analysts are now scrutinizing the factors behind these losses.

Peter Chung from Presto Research noted that the market’s recent slide is largely due to disappointing August ISM data, which led to a sell-off in traditional financial assets, including cryptocurrencies.

Chung explained that Bitcoin’s 4% drop happened in two phases. Initially, the decline was driven by US economic data, which, while significant, was less dramatic compared to the 17% drop during the August 5 market crash under similar circumstances.

The second phase saw additional declines as Asian investors reacted to weak stock performances in Asia, with major indexes like Japan’s TOPIX and South Korea’s KOSPI falling sharply.

Overall, despite the 4% drop, Chung views Bitcoin’s decrease as relatively modest given the broader market turmoil.