Dogecoin and Major Cryptos Slide Amid U.S. Economic Data

Dogecoin Leads Major Crypto Declines as Bitcoin Drops

Dogecoin (DOGE) led the losses among major cryptocurrencies as Bitcoin (BTC) fell to approximately $96,000. The decline is attributed to rising U.S. Treasury yields driven by stronger-than-expected economic data.

Widespread Crypto Market Losses

DOGE saw a steep 10% decline, while other major tokens such as Solana (SOL), Cardano (ADA), BNB Chain (BNB), and Ether (ETH) all suffered losses of at least 7%. Bitcoin itself fell by 5.5%, contributing to a 7.1% drop in the CoinDesk 20 (CD20) index.

Futures Market Liquidations Reach $560 Million

Futures markets experienced significant liquidations totaling $560 million, highlighting the risks of using margin in volatile markets. Liquidations occur when exchanges forcibly close leveraged positions.

Impact of U.S. Economic Data

The Institute for Supply Management (ISM) Services Index exceeded expectations, with its price payments measure reaching its highest level since early 2023. Additionally, U.S. job openings surpassed forecasts, intensifying concerns about Federal Reserve interest rate policies. These developments pushed the 10-year Treasury yield to its highest level since May, putting downward pressure on risk assets like cryptocurrencies.

Expert Insights

Vince Yang, CEO of zkLink, noted, "Markets took a hit yesterday, with Bitcoin and Ethereum dropping significantly. Stronger-than-expected U.S. job data reduced the likelihood of more rate cuts this year. This is not unusual for crypto."

QCP Capital, a Singapore-based trading firm, added, "We expect a turbulent January for crypto markets. The reinstatement of the U.S. debt ceiling could trigger additional volatility."

Outlook for Recovery

Market observers suggest that while the Tuesday drop is notable, the long-term potential for a rebound remains strong. Investors are advised to monitor the impact of economic data on crypto assets closely.