Global crypto market cap plunges below $1 trillion as regulatory concerns wipeout 2023 gains

The world of cryptocurrency is experiencing a turbulent phase as regulatory fears have rocked the market, leading to a significant loss in overall industry valuation. Major digital assets, such as Bitcoin (BTC), are among the most hit, leading the way in the capital outflow. 

In particular, by press time on February 13, the global cryptocurrency market had plunged below the $1 trillion capitalization to stand at $997.98 billion. Over the last 24 hours, the sector’s market cap had peaked at $1.028 trillion, according to CoinMarketCap data. 

It is worth noting in recent years, the $1 trillion market cap has been considered a critical psychological level for investors over the potential to lure institutional players into the space. 

As things stand, the market losses have been led by BTC, with the flagship cryptocurrency plunging below $22,000. Notably, the latest market sentiments have invalidated Bitcoin’s push towards reclaiming the $25,000. 

Bitcoin price analysis

By press time, Bitcoin was trading at $21,698 with daily losses of about 0.7%. Notably, despite the losses, the asset is still up over 20% on the yearly chart. Bitcoin’s market cap stands at $418.75 billion.

Other assets that are leading in market correction include Ethereum (ETH), which is down almost 10% on the weekly chart; XRP, with a correction of 8% in the last seven days; and Cardano (ADA), with corrections of over 10% on the weekly chart. 

SEC onslaught hurting crypto momentum

Indeed, the latest crypto market correction has emerged from the Securities Exchange Commission’s (SEC) renewed onslaught on the sector targeting staking activities. In this line, cryptocurrency exchange Kraken announced it would discontinue its digital-asset staking products in the United States and pay a $30 million settlement to the SEC over allegations that the service violated regulations. 

Furthermore, the SEC plans to sue stablecoin issuer Paxos, alleging that its Binance USD (BUSD) is an unregistered security. Amid the uncertainty, crypto trading expert and analyst Michaël van de Poppe suggested that the Bitcoin and general market correction is not a major concern, linking it to SEC ‘FUD‘ that has resulted in more investors getting out of the market. 

With concerns about inflation intensifying, investors are increasingly worrying about higher interest rates, putting riskier investments such as Bitcoin under pressure. Therefore, interest will be on this week’s upcoming inflation data for January.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.