Financial markets are facing extreme volatility. Over the past two months, the S&P 500 and cryptocurrencies have lost staggering amounts, causing significant investor panic.
Massive Market Losses
Since February 20th, the S&P 500 has lost $4.5 trillion, while the crypto market has dropped $1.3 trillion from its peak on December 16th. This translates to a daily loss of $350 billion for the S&P 500 and $15.5 billion for cryptocurrencies over 84 days.
Institutional Investors' Role
Institutional investors began reducing their risks well before the market downturn. This led to the largest short positions on Ethereum being established by February 9th, leaving retail investors in a difficult position.
Record Outflows and Volatility
Last week marked a record in capital outflows from crypto funds at $2.6 billion. The Volatility Index (VIX) has surged 70%, signaling continued severe price swings.
Global financial markets are undergoing a turbulent period marked by significant losses and high volatility. Investors are continuing to seek ways to mitigate risks amid instability.
