Bitcoin back to $42K, nearly recovering all of Wednesday’s losses

That didn't take long: Bitcoin is already back to where it was at the start of Wednesday, just before the biggest sell-off in 14 months.

Bitcoin (BTC) jumped 15% Thursday, recovering nearly all of the ground lost during the yesterday’s price plunge.

As of press time, the largest cryptocurrency was changing hands around $42,500. That’s roughly where it started on Wednesday, just before a 14% sell-off over the ensuing 24 hours – the biggest single-day decline since March 2020. Prices nearly fell below $30,000 at one point.

Ether (ETH), the second-largest cryptocurrency, was also on the mend Thursday, up 20% to about $2,931 at press time. The price tumbled 28% over the course of Wednesday, briefly dipping below $2,000.

Other cryptocurrencies joined in the rebound. All of the free-floating cryptocurrencies in the CoinDesk 20 were up over the past 24 hours, with cardano (ADA) jumping some 69% to $1.92. Bitcoin cash (BCH) surged 57% to $845.

Sizing Wednesday's market activity

Wednesday’s spot market volume was one for the record books, according to CoinMarketCap. Some $131.1 billion in bitcoin changed hands, nearly $5 billion more than Tuesday’s figure and nearly double the dollar volume of March 12, 2020, the “Black Thursday” of crypto.

However, it should be noted that bitcoin was trading at one-fifth its current price at that point. Thus, when measured on a bitcoin volume basis, March 2020’s sell-off was far worse.

Bitcoin’s market dominance, a measure of its market cap relative to the total for all other cryptocurrencies, briefly fell below 40% on Wednesday for the first time since June 2018.

Ether also saw record volume in trading, with close to $93.5 billion of the cryptocurrency finding new owners Wednesday.

The decentralized finance (DeFi) market was still feeling the heat from this week’s crypto market correction. The total amount of assets locked in DeFi is just above $65 billion, down from an all-time high of $88 billion on May 11, according to data site DeFiPulse.com. 

Despite the rough stretch, cryptocurrencies are still trouncing almost all other asset classes this year. Bitcoin is up around 44% year to date while ether has quadrupled in price.

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