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Crypto Market Daily Highlights – May 26 – The Crypto Meltdown

By:
Bob Mason
Updated: May 27, 2022, 01:30 GMT+00:00

The crypto market saw red on Thursday, with little on the news front to deliver support. A bearish start to Friday will test investor resilience as ETH sits at $1,750.

ETH and broader crypto sell-off to test investor resilience.

Key Insights:

  • A broad-based crypto market sell-off saw Ethereum slide to sub-$1,800 and bitcoin to sub-$28,000 on Thursday.
  • The sell-off came despite risk sentiment delivering strong support to the NASDAQ 100.
  • Downside risks remain, with the threat of a regulatory overhaul continuing to test crypto investor appetite.

It was a bearish session for the crypto market on Thursday, with Ethereum (ETH) sliding to sub-$1,800.

Investor sentiment over the threat of a regulatory overhaul tested investor sentiment. Market angst over inflation, Fed monetary policy, and inflation remained negative for the crypto market.

Bitcoin (BTC) recovered from sub-$28,000 levels, however, to wrap up the day with a modest loss. A late rebound, driven by the NASDAQ 100 breakout, delivered much-needed support in the second half of the day.

Bitcoin Correlation with the NASDAQ 100 Weakens

While bitcoin found support from the NASDAQ 100, the correlation between bitcoin and the NASDAQ weakened this week.

Bitcoin saw red for a second consecutive day on Thursday, while the NASDAQ 100 rose for a second day.

BTC correlation weakens with the NASDAQ
BTC – NASDAQ 2605 Daily Chart

Despite the bearish sentiment gripping the crypto market, however, the Fear & Greed Index rose from a May 25 11/100 to 12/100 this morning.

Index price negative for cryptos
Fear & Greed 270522

This week, the Index has hovered after recovering from a Monday 10/100. While holding steady, the Index remains deep within the “Extreme Fear” zone, reflecting investor fear of a crypto sell-off.

The Sandbox Caught a Wave Before Succumbing to Market Forces

Early in the Thursday session, The Sandbox (SAND) surged by 9.4% to strike a day high of $1.5166 before sliding into the red.

News of the King of Rock and Roll, Elvis Presley, entering The Sandbox delivered the breakout.

The Sandbox will create Elvis avatars that allow users to turn into Elvis Presley while building an ‘immersive and gamified world of Elvis in the metaverse.’

Crypto market forces reversed the morning gains, however, with The Sandbox ending the day with a 1.85% loss.

Top Ten Cryptos See Heavy Losses as Market Cap Slid by $90 Billion

On Thursday, the broad-based crypto sell-off wiped $90 billion from the crypto market cap before late support limited the damage. At the time of writing, the total market cap stood at $1,192 billion, recovering from a Thursday low of $1,153 billion.

Across the crypto top ten, SOL led the way down, tumbling by 9.35%.

Joining SOL in the deep red included ADA (-7.00%), BNB (-6.86%), DOGE (-6.08%), and ETH (-7.73%).

BTC and XRP fared better than the broader market, falling by 1.08% and 3.27%.

Away from the Crypto Moves,

  • Ex-Binance executives launched a $100 million fund to target Web3 startups in Latin America and Africa.
  • Terra reboot eyed by the markets, with LUNA 2.0 launching amidst market turbulence.
  • Miami Mayor Francis Suarez told Davos he still takes his salary in bitcoin, but with a caveat.
  • Binance expansion continued, with the exchange signing a Memorandum of Understanding with the Kazakhstan government.

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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