Crypto Market Crash Deepens as Bitcoin Falls and ETFs Face Delays

TLDR

• Bitcoin dropped to $108,000 as the crypto market crash extended on October 17.
• The overall crypto market capitalization declined by 2.2 percent in the last 24 hours.
• Stock market weakness contributed to the downturn, as major indices, such as the Nasdaq 100, fell.
• Regional banks reported loan impairments, which heightened concerns about financial instability.
• Bless and Synthentix recorded sharp losses after strong rallies earlier in the week.

The crypto market crash extended on October 17 as Bitcoin dropped to $108,000, and overall market capitalization fell 2.2%. Traders booked profits, while concerns from the equities market pressured sentiment across digital assets. Altcoins like Bless, Synthentix, and Solana also posted significant declines amid ETF delays and rising ETF outflows.

Bitcoin and Equities Selloff Deepens the Crypto Market Crash

The Bitcoin price fell sharply as the crypto market continued to crash due to renewed pressure from traditional financial markets. American stock indices, such as the Dow Jones and Nasdaq 100, dropped by more than 0.70% on Thursday. Regional bank weakness spooked investors despite positive earnings from firms like Taiwan Semiconductor and ASML.

Western Alliance and Zions Bank stocks tumbled following disclosures of significant loan impairments linked to fraud cases. These developments reignited fears within the banking sector just months after the failures of Silicon Valley Bank and First Republic. However, analysts believe these cases may not indicate systemic risk.

Despite that, crypto prices remained under pressure as traders moved away from riskier assets. “The correlation between stocks and crypto assets appears stronger during moments of stress,” said analyst Peter Nguyen. Investors reduced exposure to cryptocurrencies as macroeconomic uncertainty and financial instability weighed on sentiment.

Bless, Synthentix, and Altcoins Face Sharp Selloffs

The crypto market crash deepened as altcoins like Bless and Synthentix lost most of their weekly gains. Bless token plunged by 58% from its weekly peak and dropped below the $1 level on Friday. Traders sold heavily after the coin had surged nearly 1,000% from its weekly low.

Similarly, Synthentix (SNX) declined by 45% from its high, retreating to $1.40 during Thursday’s session. It had previously surged over 400% in the last month before the downturn. Other high-flyers like Pump, Morpho, and My Neighbor Alice also reversed their gains this week.

Profit-taking appeared widespread as traders locked in gains from recent rallies, further fueling the crypto market crash. Liquidity concerns remained as market depth thinned following the wave of liquidations. As a result, even small sell orders caused steep price declines.

ETF Approval Delays and Liquidations Add to Pressure

Delays in crypto ETF approvals due to the ongoing U.S. government shutdown contributed to today’s crypto market crash. Key applications for Solana and XRP ETFs remain stalled, which affected investor confidence. This delay weighed on institutional sentiment, which was already weakened by outflows from Bitcoin and Ethereum ETFs.

Data showed a surge in ETF outflows this week, signaling weak demand among large investors. “ETF outflows suggest a lack of sustained buying interest,” noted analyst Carol Lim. This further eroded market stability and pushed cryptocurrencies lower throughout the session.

Additionally, recent market liquidations triggered continued caution. Last Friday, over $19 billion in positions were liquidated across platforms. More than 1.6 million traders were affected, leaving many sidelined and reducing overall market activity.

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