Ether Leads Crypto Declines, Bitcoin Drops Below $71K, and Crypto Stocks Follow

Key Points

• Ether falls by 5.8%, while Bitcoin slips below $71,000, dragging down the broader crypto market.
• Major crypto stocks like MicroStrategy, Coinbase, Robinhood, and top Bitcoin miners face significant losses.
• Market declines align with sharp drops in U.S. stock indexes, with tech giants like Meta and Microsoft missing earnings expectations.
• Analysts caution that position unwinding before the U.S. elections may cause further volatility, although optimism remains high for post-election recovery.

The cryptocurrency market took a hit on Thursday, with major digital assets and crypto-related stocks experiencing notable losses. Ethereum’s ether (ETH) led the declines, plummeting by 5.8%, while Bitcoin (BTC) saw a 2% dip, slipping below $71,000 after repeatedly failing to break its all-time high of $73,700. Other altcoins like Aptos (APT) and Render (RNDR) also experienced drops, each declining by 5%.

As a result of these fluctuations, Bitcoin’s market dominance surged to 60.2%, a three-year high, indicating a shift in focus towards Bitcoin over other cryptocurrencies. This trend, tracked by TradingView, reflects investor caution amidst market instability, favoring BTC as the leading crypto asset.

Broader Market Impact: U.S. Stocks and Tech Giants Struggle

The crypto downturn echoed losses in the broader U.S. stock market. The Nasdaq and the S&P 500 saw declines of 2.3% and 1.5%, respectively, largely influenced by underwhelming earnings reports from major tech players, including Meta (META) and Microsoft (MSFT).

Crypto-related stocks also faced significant losses. Coinbase (COIN) reported earnings that fell short of analysts’ expectations, resulting in a 7% decline in its share price. Similarly, trading app Robinhood (HOOD) saw a sharp 13% drop. Bitcoin mining companies were not spared either, with MARA Digital (MARA), Riot Platforms (RIOT), and Cleanspark (CLSK) facing declines ranging from 5% to 10%. However, MicroStrategy (MSTR), a major Bitcoin holder, fared slightly better, slipping only 2.5% after announcing a substantial capital raise for future BTC purchases.

Read the complete Coinbase review and the Robinhood review.

Analysts’ Perspectives on the Crypto Market and Upcoming U.S. Election

The downturn has investors considering possible market shifts as the U.S. presidential election approaches. Geoffrey Kendrick, Head of Digital Assets Research at Standard Chartered, observed a rising risk of position unwinding among traders looking to lock in recent gains. Despite the current market dip, Kendrick maintains an optimistic outlook, expecting a rebound after the election, regardless of its outcome.

Analysts at Standard Chartered indicate that a Republican victory would likely offer the most favorable conditions for crypto, with a bullish environment expected for digital assets. This optimistic outlook includes a year-end Bitcoin price target of $125,000, with altcoins like Solana (SOL) potentially benefiting from more supportive regulations.

Outlook for Bitcoin and Ether Amid Market Turbulence

While short-term volatility persists, the larger trend suggests continued interest in Bitcoin, especially given its growing dominance. Investors in the crypto space remain optimistic for a recovery in the final quarter, driven by political developments and renewed interest from institutional investors.