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The cryptocurrency market faced a massive sell-off on the first day of trading this week as the majority of the altcoins and Bitcoin lost up to 10% of their value, cooling off significantly after the relief rally we saw last week.
Cardano among biggest losers
Unfortunately, ADA lost more than 8% of its value from the local high yesterday. The sell-off on Cardano was mostly caused by the general sentiment of the market that had a rough start after the opening of Asian markets.
It is not yet clear what the fundamental reason is behind the strong plunge for Cardano, but as we mentioned early, we saw a large spike in open interest on derivatives trading platforms, which might be the main source of the selling pressure. Open interest is not necessarily reflected in the number of longs on the market.
Despite short-term fluctuations on the cryptocurrency market, Cardano remains one of the fundamentally strongest assets in the industry as it receives a number of updates and shows the highest development activity around it.
Recently, U.Today covered how Cardano reached the new network stability milestone as it has shown almost 1,800 days of working without outages or other major issues with network stability.
Altcoins bleeding massively
Unfortunately, the majority of altcoins are facing massive outflows and selling pressure as large cryptocurrencies like XRP lost around 9% from their local highs as fear returned to the cryptocurrency market.
Last week, we saw a rally on numerous altcoins, including Ethereum Classic, Cardano and AAVE. The main reason behind the positivity on the market could have been tied to the Ethereum Merge date reveal that attracted a certain amount of investors back into the market.
What's there for Bitcoin?
This week, the cryptocurrency market might get shaky once again as we are going to see the results of an upcoming FOMC meeting and the earnings releases of numerous tech companies that might affect the cryptocurrency market and GDP data.
All of those events might have a strong effect on Bitcoin as they have a direct effect on financial markets, which the crypto industry almost blindly follows for the last few months after entering a downtrend.
As for now, the cryptocurrency market is not yet pricing the aforementioned events and their effects on some digital assets. The majority of altcoins remain in the red zone after the recovery rally on the weekend, and Bitcoin is currently struggling to maintain above the $22,000 price range.
Dan Burgin
U.Today Editorial Team
