Bitcoin, XRP, Ethereum in Selloff Mode
The Japanese market has been thrown into a state of panic following the Bank of Japan’s decision to raise interest rates, causing a ripple effect across various asset classes, including cryptocurrencies. As a result, Bitcoin (BTC), Ethereum (ETH), and XRP are experiencing significant selling pressure amid the broader market turmoil.
Key Metrics in the Japanese Market Face Downtrend
On August 2, the Japanese market experienced substantial losses for the second consecutive trading day this month. The selloff was triggered by the rapid strengthening of the yen due to the Bank of Japan (BoJ) and a concurrent sell-off in U.S. stocks.
For over a year, Japanese stocks have enjoyed a series of rallies driven by the depreciation of the local currency and robust corporate earnings. The return of modest inflation and enhancements in corporate governance further supported this growth. Additionally, a surge in chip-related stocks contributed to the market’s ascent. However, this week marked a sharp reversal in the Japanese stock market’s performance.
Companies across the broad swath of the Japanese economy, primarily grouped under the Japan Topix Index, faced intense selloffs. Consequently, this metric tumbled by 6.1% on Friday, extending the previous day’s losses and marking the index’s worst two-day performance since the 2011 earthquake and tsunami. Similarly, the Nikkei 225 (INDEXNIKKEI: NI225) dropped by 5.8% to 35,909.70.
Analysts and market observers noted that the Japanese market swung into panic mode following the Bank of Japan’s decision to raise interest rates for the second time since 2007. Concerns about the Japanese economy’s health and the U.S. tech industry’s status exacerbated the market sentiment.
Cryptocurrency Industry Faces Price Dip
The cryptocurrency ecosystem has not been spared from the recent price declines, with most digital assets witnessing gradual drops in value. The leading cryptocurrency, Bitcoin (BTC), is currently trading at $64,263.73, down 0.79% within the last 24 hours. Despite an upside in trading volume, it remains insufficient to bolster investor confidence. At press time, BTC trading volume stood at $40.08 billion, ranking it as the second most traded position. Bitcoin’s current position is perceived as a reaction to the Federal Open Market Committee (FOMC) data released on Wednesday.
Ethereum (ETH) is also down by 1.96%, trading at $3,135.14. Its trading volume has decreased by 3%, currently at $18.5 billion. Compared to BTC and ETH, Ripple-associated XRP has suffered more significant losses. XRP is currently trading at $0.5705, marking a 6.75% drop in the last 24 hours. This selloff is understandable, considering that many Ripple Labs allies, including SBI Holdings, are based in Japan and are impacted by the current market crisis. Additionally, the XRP price dip follows significant transactions by Ripple, including moving 1 billion XRP and unlocking 500 million tokens from escrow.
