Analysts have called the recent $100 billion loss in digital currency a “normal” and necessary phenomenon in a rapidly-growing market. The exit of this amount of capital may sound alarming, but analysts view these events as healthy and typical for the highly leveraged digital asset markets, supporting the ongoing financial maturation of the crypto world.

The crypto market capitalization saw a significant downturn of approximately $100 billion within a single day, bringing the total from a 21-month high of $1.82 trillion to around $1.71 trillion. This 5% drop exemplifies another standard market flush seen in crypto markets due to their heavily leveraged nature.

A stark decrease in crypto derivative open interest and funding rates had been noticed even before this market flush, indicating that a sizable number of unsettled contracts and fees required to uphold leveraged positions were declining. This resulted in a minimal amount of liquidation within the system, reflecting that the market was not overly heated or at risk.

While the cryptocurrency market has faced its ups and downs, there’s a growing confidence among industry experts of Bitcoin ETFs gaining approvals by January 10, despite the SEC report suggesting otherwise. Any potential denial of these ETFs by the SEC can be a setback, pushing Bitcoin prices into the $30,000 range.

In the meantime, the crypto market displays stability with Bitcoin trading at $43,197 and Ethereum at $2,291.1 at the time of the report