Under constant selling pressure, the total crypto market cap has dropped by another 2.5% over the past day to the $819 billion mark. However, the 24 hour trading volume has jumped by 33% to stand at $45.48 billion.
Today’s drop in the crypto market has followed the correction in Asian equities and U.S. equity futures. This is mostly associated with massive protests that have erupted across China amidst the country’s strict COVID-19 restrictions. The events at Foxconn’s iPhone factory last week have triggered further reactions across the country. China’s ongoing covid-shutdowns are seen as an impediment to stabilizing domestic demand, which has caused ripple effects elsewhere.
As a result of the growing unrest in the east, investors seem to be heading into a risk-off mode, pushing safe-haven assets like the US Dollar, bonds, and Yen higher.
What you should know
The wETH insolvency FUD seemingly began to make the rounds on Nov. 26, with false rumours alleging that wETH isn’t backed 1:1 by Ether (ETH) and is insolvent. Blockchain developer and contributor to the ERC-721A token standard cygaar was one of the first to spread the joke, before confirming in a subsequent post that it was in fact a “shitpost” to see who was reading his content.
Today, Tron founder Justin Sun said he and Ethereum co-founder Vitalik Buterin will invest $2 billion into the WEF to recover the funds lost as wrapped Ethereum depegs with Ethereum. However, not many people realized that it is part of a joke about WETH going insolvent. Big names including Vitalik contributing to it caused a market-wide selloff in the crypto market.