The cryptocurrency markets experienced a significant downturn on Monday, with several altcoins dropping by more than 10%. An industry analyst told Cointelegraph that there is no clear reason for this sudden decline.
The overall crypto market cap has decreased to $2.46 trillion, marking a 3.5% drop in the last 24 hours. Among the top 20 altcoins by market cap, Shiba Inu (SHIB) and Avalanche (AVAX) were hit the hardest on June 17, plummeting by 12.7% and 10.6% respectively, according to CoinGecko data.
Other popular altcoins like Uniswap (UNI), Dogecoin (DOGE), Solana (SOL), and Ripple’s XRP also saw significant decreases in value, while Bitcoin (BTC) and Ether (ETH) experienced declines of 1.3% and 4.4% over the same period.
Henrik Anderrson, the chief investment officer at asset manager Apollo Crypto, mentioned that the recent drop in interest in spot Bitcoin exchange-traded funds (ETFs) may have contributed to the market downturn. He highlighted that negative BTC ETF flows led to weakness in altcoins, resulting in liquidations of leveraged long positions in Bitcoin, Ethereum, and Dogecoin.
According to data from Farside Investors, spot Bitcoin ETFs have witnessed outflows on five of the last six trading days. 10xResearch, a digital asset firm, also linked the recent crash in altcoins to the decrease in spot Bitcoin ETF flows over the past week.
Despite the overall market decline, Bitcoin mining stocks have been performing well in recent weeks, recovering from the impact of April’s halving event. Mitchell Askew, head analyst at Blockware Solutions, noted that mining stocks, which previously underperformed due to profitability concerns post-halving, are now returning to a more stable position.
The Valkyrie Bitcoin Miners exchange-traded fund, WGMI, has surged by approximately 54% since the halving event, indicating renewed investor confidence in the mining sector. Askew highlighted that mining stocks are regaining ground relative to Bitcoin and its associated companies like MicroStrategy.
In related news, Charles Edwards, X Hall of Flame, advised investors to buy altcoins now but consider selling before mid-2025, emphasizing the potential risks associated with the current market conditions.