Bitcoin breaks through $50,000 mark

The world's largest cryptocurrency fell to its lowest level in nearly half a year, while the second-largest, Ether, had its biggest one-day drop in nearly three years.

According to CoinDesk data , Bitcoin started shaking early this morning when the market price gradually decreased over time from under $60,000 to around $54,000 at around 8:00 a.m. After that, the currency recovered slightly and struggled around the above mark.

Early in the afternoon, the market recorded a new shake. At around 1:24 p.m., Bitcoin broke through an important support level, falling straight to $49,314 per unit - the lowest level since mid-February. In 24 hours, the world's largest cryptocurrency lost about 14% of its market value.

The loss of the above support level is very serious because many experts previously predicted that Bitcoin needed to hold $50,000 to prevent a retreat to $48,000 that would happen soon after.

More severely, Ether - the world's second largest cryptocurrency - fell from more than $3,500 to $1,700 per coin, equivalent to 25%. This is the worst daily adjustment since May 2021. Other digital currencies such as Binance Coin, Solana, XRP... all fell by 20% or more.

The move sent the Fear and Greed Index into negative territory, hitting its lowest level since early July. The index tracks volatility, prices and social media data to show whether investors are fearful — often a sign of a local bottom — or greedy, marking a market top.

The market turned red as cryptocurrency futures saw more than $840 million in liquidations in the past 24 hours, making for a sell-off that was worse than yesterday’s. The shakeout was fueled by a stronger Japanese yen and rumors that market maker Jump Trading was winding down its cryptocurrency trading operations.

Of these, Ether futures saw more than $304 million in liquidations, more than Bitcoin. Futures tracking Solana, Dogecoin, XRP, and Pepe also saw $75 million in cumulative liquidations.

More than 200,000 individual traders were hit with liquidation orders. Data from the Huobi cryptocurrency exchange showed that about 87% of those affected were long traders, betting on higher prices.

Not only cryptocurrencies, the global financial system is also being shaken by a wave of intense stock sell-offs, as investors worry about the possibility of an economic recession in the US. The wave occurred after the US July employment report shocked with much weaker-than-expected figures, raising concerns about the risk of an economic recession.

With signs of a slowing US economy, traders are betting heavily on the possibility of the US Federal Reserve cutting interest rates soon. Economists at leading financial institutions such as Citigroup and JPMorgan Chase are even predicting that the Fed could cut by as much as half a percentage point at its September and November meetings.