- Bitcoin and Ethereum prices fall sharply.
- Japan’s tax proposal spooks investors.
- Altcoins and small caps show mixed performance.
The crypto market faced a sharp decline following Japan’s proposed 20% flat tax on crypto gains. This regulatory announcement has triggered fear among global investors, causing both Bitcoin and Ethereum to lose significant value. As of now, Bitcoin has dropped below $90,000, sitting at $86,523, while Ethereum is trading at $2,836, both down around 5% in the last 24 hours.
Market-wide liquidations have surged to $637 million, while the total crypto market cap has fallen to $3.11 trillion. Sentiment indicators reflect this panic, with the Fear and Greed Index (FGI) plunging to 24, signaling “Extreme Fear.”
Focus Shifts to Regulation and Risk
The decline wasn’t just driven by Japan’s proposal. The People’s Bank of China (PBOC) also weighed in, reaffirming that virtual assets are not recognized as legal tender and cannot be used as currency. This statement added to the bearish mood, underscoring a broader tightening of global regulatory attitudes towards crypto.
Meanwhile, BlackRock’s CEO has confirmed that the firm’s Bitcoin ETF has become a primary revenue driver. This highlights institutional interest, but it hasn’t been enough to offset the wider market panic.
Altcoin Divergence: Winners and Losers
Major altcoins also took a hit. Zcash ($ZEC) led the losers with a 22% drop, followed by Ethena ($ENA) down 17%, Dash ($DASH) 14%, and both TIA and Virtual down 13%.
On the flip side, small-cap tokens saw some surprising gains. Tradoor ($TRADOOR) and ZND jumped by 41%, while Pieverse ($PIEVERSE) and Griffain ($GRIFFAIN) rose 26%. TNSR also climbed 24%, showing that some investors are rotating into riskier assets despite overall market uncertainty.
Adding to the mix, Telegram’s Pavel Durov announced the launch of the decentralized Cocoon network—potentially a bright spot amid the turmoil.
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