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Wintemute: Crypto Market Capitalization Falls Below $3 Trillion Amid Multiple Simultaneous Factors
The market capitalization fell below $3 trillion after AI trading “began to unravel,” triggering an outflow from risky assets. Wintermute researchers noted that investors took profits in the tech sector, increasing pressure on cryptocurrencies. The decline occurred “amid thin liquidity ahead of the U.S. holiday period.” Supply dropped to April levels. Altcoins again became the weakest segment.
Macro conditions intensified the sell-off and worsened overall sector sentiment. Recent U.S. labor market data showed unemployment rising to 4.4%, creating additional uncertainty about the Fed’s future policy. The probability of a rate cut in December fell to 30%, reinforcing institutional investors’ caution. In Asia, pressure increased due to the weakness of the Japanese yen (JPY). The situation in Europe and China also remained tense.
Even strong Nvidia earnings failed to support the trend as investors used the rebound to reduce exposure. This marked the first clear sign of buyer fatigue in the tech sector in months. Amid U.S. weakness, the pressure quickly shifted to the crypto market. Investors began to lock in positions and reduce risks due to the lack of new growth drivers.
“The digital asset market has been the worst-performing major asset class for the third consecutive week. Sales affected a wide range of coins, and liquidations amplified the downward move,” researchers emphasized. Despite the drop in leading cryptocurrencies, spot market volumes remained stable, indicating the presence of numerous traders. Analysts note that the coming days will be critical for assessing further dynamics.
The return of market activity became an important signal of structural improvement. Liquidity was better than expected during the holiday week. This reduces the risk of panic moves and lowers the likelihood of deep declines.
See also: "Analyst: Bitcoin Is Under Pressure Amid a Potential MSCI Review of Strategy Inc."
