Crypto Stocks Plunge: Coinbase, Marathon Digital, Riot Platforms Hit Hard

Cryptocurrency exchange Coinbase had a tough week, with its worst performance of the year. The Securities and Exchange Commission filed a lawsuit against Coinbase, accusing the platform of violating securities laws by not registering with the SEC. This led to a 20% drop in Coinbase’s stock.

Bitcoin miner Marathon Digital also took a hit, falling by 20%. The overall crypto market faced challenges, with prices of bitcoin, ether, and other risky assets declining. The tech-heavy Nasdaq dropped by 5.8%, marking its worst week since January 2022.

September historically poses difficulties for crypto assets, with bitcoin seeing an average loss of 4.8%. The Crypto Fear & Greed Index indicates extreme fear among investors, affecting price movements. Bitcoin’s value dropped to $54,000, its lowest since February.

The Labor Day holiday-shortened week saw a significant market selloff following weak manufacturing data, raising concerns about an economic slowdown. The U.S. spot bitcoin exchange-traded funds experienced their worst day in over four months, with over $287 million collectively withdrawn from the ETFs.

The total crypto market cap is down nearly 30% from its peak in 2024, now standing at $1.9 trillion. Altcoins like Solana’s SOL token, XRP, and Cardano’s ADA suffered losses, with Ether plummeting by 12% to around $2,200.

Investors heavily invested in crypto stocks felt the impact, with Schwab Asset Management’s crypto-themed ETF dropping by 11%. Coinbase and MicroStrategy both saw significant declines, with Coinbase’s stock hitting its lowest point since February.

Looking ahead, all eyes are on the Federal Reserve’s upcoming meeting, where a rate cut is anticipated. Looser monetary policy could benefit risky assets like crypto. Inflation data and the U.S. presidential debate are also expected to influence crypto markets. The debate, especially, could be a price driver, with Republican nominee Donald Trump’s pro-crypto stance gaining attention.

As the crypto market navigates through challenges, investors are bracing for potential market shifts and regulatory developments that could impact the industry’s trajectory.