Bitcoin dropped 3.1 percent to $79,056 in the last 24 hours, pushing the asset below the $80,000 psychological threshold. Ethereum followed, falling 3 percent and now trading at $2,226. Solana declined to $89.19. The Crypto Fear & Greed Index registered 31, indicating fear across the market as capital rotates out of risk assets.
On-chain data reveals a notable pause in large-wallet accumulation, signaling a shift in institutional buying behavior. Addresses holding between 1,000 and 10,000 BTC have shown minimal net change over the past 48 hours, a stark departure from the consistent buying observed throughout early May. Major players are now sidelined, waiting for clearer price direction rather than actively buying the dip.
The broader market downturn coincides with weakness across traditional tech indices. The Nasdaq fell 1.5 percent today, with NVDA dropping 4.4 percent and Tesla down 4.8 percent. This correlation shows how digital assets remain tied to risk-off sentiment in traditional markets. XRP held steady at $1.43, showing relative resilience against the wider sell-off.
Bitcoin is testing critical support levels established during its ascent this year. The 50-day moving average, a key short-term trend indicator, sits at $80,500. A sustained break below this point would challenge the 200-day moving average, positioned around $72,500, which acts as crucial long-term support. A move below $72,500 would signal further downside potential.
The recent approval of spot Ethereum ETFs in May 2024 has not generated the same institutional demand seen with Bitcoin ETFs during their initial launch in Jan. 2024. Net flows into ETH products have remained modest, indicating that traditional finance is exercising caution with altcoin exposure. This divergence in institutional demand continues to impact Ethereum's short-term price trajectory.
Decentralized finance protocols have observed a reduction in total value locked across major chains like Ethereum and Solana. Increased liquidations in leveraged positions occurred as prices declined, a common market cleansing event that removes over-leveraged participants and often sets the stage for healthier recovery.