The total market capitalization for all crypto assets fell short of $1 trillion following the latest data revealed by the August consumer price index (CPI), which measures the rate at which the prices of goods and services in the US economy are rising.
According to crypto data aggregator Coinglass, nearly 100,000 traders were liquidated on multiple exchanges and the total liquidations come in at more than $360 million.
The numbers on the CPI print indicate simmering inflation as the year-over-year inflation came in at 8.3% against the anticipated 8.1%.
The current CPI has adversely affected the sentiment around crypto assets as the losses in the derivatives market accentuate that cryptocurrency's fortunes are very much tethered to the dictates of the Federal Reserve.
Edward Moya, a senior market analyst with Oanda, told Yahoo Finance the crypto market could still rebound if the prices of Bitcoin and Ethereum can sustain levels above $21,000 and $1,600, respectively:
I still think we're approaching a moment where we will see cryptocurrencies begin to trade on their own fundamentals and that means it will not necessarily be just a leveraged trade of what's happening with tech stocks.
Bitcoin (BTC) briefly fell below its crucial $20,000 mark and currently trades at $20,085 at the time of writing. Ethereum (ETH) previously traded at $1789 and has plummeted to $1589 since the release of the August consumer-price index (CPI) on Tuesday.