Profit taking in bitcoin (BTC) contributed to a broader market drop as tokens of some of the largest blockchains, such as solana’s SOL fell as much as 8% in the past 24 hours, data shows.
Bitcoin dipped under $30,000 during European hours on Friday, even as broader traditional markets remained relatively unchanged. Ether (ETH) shed over 3%. Among other large caps, XRP fell as much as 6% in the past 24 hours, while Cardano’s ADA and Avalanche’s AVAX fell 4% in the same period.
Elsewhere, stellar’s XLM dropped 6.6% as traders likely took profits after a 10% rise over the past week. Chainlink’s LINK traded flat following a 15% rise on Thursday – buoyed by the introduction of its CCIP protocol earlier this week.
Some of the selling pressure may have arisen as U.S. House Republicans introduced a new digital assets oversight bill on Thursday that aims to establish a regulatory framework to protect investors in the crypto sector.
Analysts said parts of the revised bill exclude from the definition of “digital assets” a range of traditional securities such as stocks, bonds, “transferable share[s],” “certificate[s] of interest or participation in any profit-sharing agreement,” and so on.
“All they have to do is argue that a token is a “transferable share” “a profit interest” etc,” Gabriel Shapiro, general counsel at crypto fund Delphi Digital, tweeted. “XRP and such will be fine but DeFi can still be persecuted at will… actually the regulators will have expanded authority to do so.”
The CoinDesk Market Index (CMI), a broad-based index designed to measure the market capitalization-weighted performance of the crypto market, fell 1.7%.
Meanwhile, the drop in prices caused over $66 million in liquidations in the past 24 hours, data from the analytics tool Coinglass shows. Slightly over 70% of these liquidations were on longs positions, or from traders betting on higher prices.
Liquidations occur when traders borrow funds from exchanges to bet on crypto prices using a relatively smaller initial capital, one that is forfeited when prices reach a predetermined liquidation level.
