Crypto majors lost just under 0.5% as U.S. markets closed lower on Tuesday.
Bitcoin (BTC) and ether (ETH) remained little changed over the past 24 hours as traders suggested major cryptos were starting to show signs of correlation to U.S. equities.
The price of bitcoin (BTC) remained under pressure at $26,200 on Tuesday as the idea of higher rates for a longer period takes hold throughout financial markets, as reported. Traders are seemingly pricing in fear of inflation, which may impact riskier assets.
“The positive correlation between cryptocurrencies and the stock market is temporarily back on track,” shared Alex Kuptsikevich, the FxPro senior market analyst, in a note to CoinDesk. “Despite the storm in the equity markets, the crypto market remains subdued, losing only 0.3% in 24 hours to $1.045 trillion.”
“However, the Crypto Market Fear and Greed Index is dipping into “fear” territory, implying the crypto market did not suddenly become a safe haven,” he added. The index assumes that fear drives stocks lower while greed boosts stock values.
Crypto markets slumped 0.5%, the CoinDesk Markets Index (CMI), a broad-based tracker of hundreds of tokens, shows. This mirrored a drop in the U.S. markets on Tuesday – with the S&P500 losing 1.5%, the Dow Jones Index falling 1.1% and the tech-heavy Nasdaq 100 ending the day 1.4% lower.
However, Asian markets rose higher Wednesday, bringing relief to crypto bulls as majors pared back some of Tuesday’s losses. BTC exchanged hands at $26,300, ETH at $1,580 in Asian morning hours.
Elsewhere, alternative tokens showed tepid growth with only a few showing gains. Maker protocol’s MKR rose 5.5%, while Shiba Inu ecosystem BONE rose 10%, the highest among all actively traded tokens.