Bitcoin's price has dropped below $50,000 for the first time since February, hitting a low of $49,351 before rebounding to around $51,000.
This decline comes as BTC dominance rises to 58% amidst significant drops in both the altcoin and stock markets.
The cryptocurrency market has seen a drastic contraction, with over 17% of its total market capitalization erased.
CoinMarketCap reported that the market cap, which was approximately $2.16 trillion, has fallen to about $1.76 trillion as of August 5.
In the early hours of August 5, Bitcoin's drop triggered the liquidation of $600 million in leveraged long positions. This market turmoil also affected Ether (ETH), which saw a sharp decline, losing nearly 20% of its value in just two hours. As of the latest update, ETH is trading around $2,200, recovering from a low of $2,172 earlier in the day.
This market crash is part of the most significant sell-off in nearly a year, with over $500 billion in losses recorded since August 2. The decline in the S&P 500, which fell over 4% in the same period, has contributed to the downturn.
The market's decline has been fueled by renewed recession fears, disappointing U.S. employment data, and sluggish growth among major tech stocks.
The Crypto Fear & Greed Index, which was at 67 ("Greed") on July 29, has now plunged to 26, indicating a state of "Fear" in the market.
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