The price of Bitcoin (BTC) had been steadily dropping from $10,300 to $8,400 over the past several days, but during the afternoon of Sept. 24, the price drop became more precipitous. Bitcoin (BTC) briefly declined as low as $8,000, a level not seen since June. Simultaneously, the price of major cryptocurrencies declined anywhere from 10-30%, and the total crypto market cap went as low as $218 billion, down $40 billion in less than 24 hours.
More specifically, a snapshot as of the evening of the 24th shows:
- Ethereum (ETH) down 17% and trading near $168,
- Ripple (XRP) down 12%,
- Bitcoin Cash (BCH) down 24% and trading near $223,
- Litecoin (LTC) down 17% and trading near $55,
- EOS down 23% and trading below $3,
- Binance Coin (BNB) down 17%,
- Stellar (XLM) down 13%,
- Monero (XMR) down 16% and trading near $59,
- Cardano (ADA) down 18%,
- Tron (TRX) down 21%,
- and DASH down 17% and trading near $72.
These percentage losses and prices are after the crypto market bounced off of the lows for the day too, with Bitcoin (BTC) rising back to $8,600 and the total crypto market cap rebounding to $223 billion.
Also, Bitcoin (BTC) is ‘only’ down 11%, so altcoins were hit harder by the bearishness.
The major question is why did the crypto market suddenly crash on Sept. 24? Below Crypto.IQ presents some theories, although it must be remembered that the market is a highly complex system, and it is difficult to attribute market movements to a precise cause.
Perhaps the beginning of an impeachment inquiry on President Trump, which is the biggest news of the day, had something to do with the crypto market crash. The potential for impeachment has caused stock indices to dip well into the red due to economic uncertainty. How exactly this would impact the crypto market is unclear.
Another potential cause is the launch of Bakkt physical Bitcoin (BTC) futures only two days ago. When CME Bitcoin (BTC) futures launched, it introduced massive short-selling pressure and precipitated the beginning of the 2018 bear market. It was speculated that Bakkt physical Bitcoin (BTC) futures would increase Bitcoin (BTC) demand and price since actual Bitcoin (BTC) are used, but it is possible Bakkt ended up introducing more short-selling pressure than anticipated. This is debatable though since the volume on Bakkt is apparently low so far.
Another potential cause of the bearishness is the announcement that NASA and Google achieved quantum supremacy. Some consider this a threat to all current forms of cryptography and therefore cryptocurrency, but this is quite debatable and will be covered in a future Crypto.IQ article.
Finally, the CME Bitcoin Futures contract for September expires on Friday the 27th, and this event is often associated with major Bitcoin (BTC) market movements. It is possible traders went short for September and are ‘banging the close’ to increase their profits.
Thus, the Trump impeachment inquiry, the first computer to achieve quantum supremacy, the CME Bitcoin Futures expiration, and the launch of Bakkt are all potential factors as to why the crypto market crashed on Sept. 24, although the exact impact of each of these factors on the crypto market is unknown.