Black Friday has been a day of red for the overall cryptocurrency market, with most major tokens posting sizable sell-offs.
Friday’s sell-offs in the cryptocurrency market may be most closely tied to the emergence of a new COVID-19 strain, but other factors are likely at play as well.
A new coronavirus variant has been discovered in South Africa, and health officials are concerned that it appears to be highly transmissible and capable of bypassing current vaccines.
The S&P 500 index ended the day down roughly 2.3%, while the Nasdaq Composite and Dow Jones Industrial Average fell 2.2% and 2.5%, respectively.
In addition to bearish pressure stemming from concerns about the new COVID mutation, valuations for many cryptocurrencies have slipped amid recent regulatory developments and the perception of elevated risk for future crackdowns.
The infrastructure spending bill recently signed into law by President Biden also created new rules for crypto brokers, and it’s not unreasonable to think that additional domestic regulations and taxes could be in the pipeline.
Despite recent sell-offs, Avalanche’s AVAX token is down just 3% over the last seven days of trading.
Without a major positive recent pricing catalyst recently, Ripple’s XRP token has gotten caught up in the bearish momentum impacting the broader crypto market and is down roughly 12.5% over the last seven days.
Cardano has seen a particularly steep drop over the last week of trading, with its price per token down roughly 15% across this stretch.
Pricing volatility is the norm in the crypto space, and it’s helpful to put recent moves in context.
The crypto market will likely continue to be highly volatile in the near term.