The cryptocurrency market is experiencing a wave of volatility in response to macroeconomic uncertainty triggered by a large sell-off of Bitcoin.
Response of Bitcoin Holders to Macroeconomic Uncertainty
Bitcoin holders (STHs) reacted to looming macroeconomic uncertainty by offloading 11,549 BTC, worth $1.20 billion. This occurred on May 11th when Bitcoin was priced around $104,139. The sell-off resulted in a significant market correction, with Bitcoin's price dropping to $100,691, marking the largest intraday drawdown in over a week, leading to over $500 million in liquidations.
Impact on Altcoins: Dogecoin and Cardano
While all major cryptocurrencies felt the effects of this sell-off, Dogecoin and Cardano were hit the hardest. DOGE experienced an $18 million squeeze in long positions, far surpassing Cardano's comparatively modest $4.7 million in forced exits. Historically, STHs have turned to altcoins as a safe haven during Bitcoin overextensions, but this recent market movement has put that strategy to the test.
Current Market Situation
The market is currently in a 'wait-and-see' mode, with many investors closely monitoring April's Consumer Price Index (CPI) print. This data drop could be a decisive factor in shaping future market trends. Additionally, the narrative around potential rate cuts adds complexity; historical data suggests that the Federal Reserve has maintained a hawkish stance even during peak tariff chaos.
The cryptocurrency market continues to show high volatility in response to macroeconomic factors, leading to significant changes in both Bitcoin's value and the fortunes of altcoins.
