Crypto Market Crash: Here’s Why Bitcoin, Ethereum, Altcoins Falling Today

Key Insights:

• Crypto market crash caused Bitcoin price slump to $111K and Ethereum to the $4,500 level.
• Over $900 million in crypto assets were liquidated as a dormant whale sold 24K BTC worth $2.7 billion.
• Upcoming monthly crypto options expiry and the U.S. PCE inflation data to decide market direction in September.

Crypto market crash caused the global market cap to plunge nearly 3% to a low of $3.86 trillion on Monday. Positive sentiments from Fed Chair Jerome Powell’s dovish comments faded, continuing profit booking in Bitcoin, Ethereum, and altcoins.

On Friday, The Coin Republic alerted about a massive crypto crash upcoming next week due to a monthly crypto options expiry. Also, the PCE inflation data due on August 29 is making traders cautious.

Bitcoin (BTC) price pared earlier gains to fall to $111K, with options expiry could take the price further lower on Friday. Meanwhile, Ethereum (ETH) price failed to hold upside momentum after hitting a new all-time high of $4,953.

Top altcoins such as XRP, BNB, Solana (SOL), TRON (TRX), and Cardano (ADA) tumbled 4-7%. Whereas, meme coins Dogecoin (DOGE) and Shiba Inu (SHIB) tumbled more than 5% and 4%, respectively.

Over $900 Million Liquidated During Crypto Market Crash

The crypto market saw over $900 million in total crypto liquidations in the last 24 hours, according to Coinglass data. Notably, more than $300 million in long positions got liquidated in an hour, with almost $730 million in long and $170 million in short positions liquidated over the past 24 hours.

More than 163K traders were liquidated in the last 24 hours, with the largest single liquidation order of BTC valued at $12.49 million on crypto exchange OKX.

Recently, more than $600 million in crypto liquidations were recorded on August 18. Since then, the crypto market has remained under selling pressure despite a recent rebound.

Bitcoin Selloffs by Whales Impacting Altcoins’ Performance

Whales exiting the crypto market are limiting Bitcoin price rally. For instance, a Satoshi-era whale sold all 80K BTC holdings through Galaxy Digital.

Bitcoin’s post-Jackson Hole gains faded after a dormant whale woke up after 5 years and sold 24K BTC worth $2.7 billion. The single move crashed Bitcoin to $111K and erased $50 billion in market value.

Lookonchain reported that a Bitcoin OG who received 100,784 BTC worth $642 million 7 years ago was dumping BTC for ETH last week. Now, the Bitcoin OG closed his long positions on ETH and purchased ETH spot.

Moreover, institutions are also rotating BTC to ETH, as evident from six consecutive outflows from spot Bitcoin ETFs of nearly $1.2 billion. Meanwhile, Strategy’s BTC purchases in August were smaller than usual, hampering investors’ positive sentiment.

Crypto research firm Matrixport said Ethereum ETFs are taking the lead as capital rotates out of Bitcoin. Ethereum treasury companies such as BitMine Immersion and SharpLink Gaming continue to add ETH.

However, the recent Bitcoin selloffs triggered market-wide profit booking. Altcoins such as XRP, BNB, Solana (SOL), TRON (TRX), Cardano (ADA), Dogecoin (DOGE), among others, tumbled in response.

Crypto Market Crash on Bitcoin and Ethereum Options Expiry

This Friday, BTC options worth $11.8 billion are set to expire on the largest derivatives crypto exchange Deribit. This accounts for about 30% of total positions, with a put-call ratio of 0.88 and the maximum pain point at $116,000.

Bitcoin price fell more than 3%, with the price trading at $111,150 at the time of writing. The 24-hour low and high were $111,060 and $114,915, respectively.

In contrast, $3.1 billion in ETH options are to expire, which accounts for 26% of total positions. At the time of writing, the put-call ratio was 0.72, with the maximum pain point at $3,800.

Ethereum price dropped 4% to a 24-hour low of $4,526 from an all-time high of $4,953.73. Furthermore, the trading volume skyrocketed by 118% over the last 24 hours.

The options expiry will coincide with the U.S. Federal Reserve’s preferred inflation gauge US PCE data release. A higher-than-expected PCE reading will take the September Fed rate cut off the table.