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The crypto market has been going through a week of high volatility. The two biggest cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH), made notable movements on February 21. Both assets fell before recovering today. Bitcoin pulled back to $50,700, while Ethereum dropped just below $2,890 before rising again. The sell-offs were anticipated by some investors, but the price action analysis was not seen as an indicator of broader market trends.
Nvidia’s Market Movement in the Crypto Space
Although the crypto market reached its highest levels in recent months at the beginning of the week, it faced a slight decline as investors began to take profits and market observers awaited the earnings report from leading chip manufacturer Nvidia (NVDA). The decline particularly affected major altcoins. Popular altcoins such as Polygon‘s MATIC led the losses with a 7% drop, while Cardano‘s ADA and Ripple‘s XRP fell by up to 5%.
Although there were expectations that Nvidia’s fourth-quarter earnings report would fall short, the company ultimately announced better-than-expected results, leading to a resurgence in the market. Nvidia’s earnings beat particularly sparked a rally in artificial intelligence altcoins. Following the launch of OpenAI’s Sora product, there was increased activity in AI altcoins the previous week, with Worldcoin‘s WLD reaching an all-time high and pushing the total market value of AI altcoins above $15 billion.
Sharp price movements across the market caused over $200 million in liquidations in futures. According to CoinGlass data, $150 million in long positions were liquidated. Following Nvidia’s better-than-expected earnings report, the market began to recover, leading to a predominance of short position liquidations this time.
FxPro senior market analyst Alex Kuptsikevich noted that despite Bitcoin’s lack of upward momentum in recent days, it is positive that it has not been under strong selling pressure.
Bitcoin’s Dominance Continues to Pose a Challenge for Altcoin Season
Markus Thielen, president of 10x Research, mentioned that Bitcoin’s ongoing market dominance, currently at 51%, continues to be a significant barrier for altcoins.
Thielen noted that for an altcoin season to begin, Bitcoin’s market dominance would need to fall below 45%, and such a decline would be a sign of capital shifting towards altcoins.
