Bitcoin’s decline from its peak has wiped out more than US$600 billion in market value, and over $1 trillion has been lost from the aggregate crypto market.

While there have been much larger percentage drawdowns for both Bitcoin and the broader market, this marks the second-largest ever decline in dollar terms for both, according to Bespoke Investment Group.

Bitcoin fell as low as $34,042.78 on Saturday, a drop of 7.2%, before paring most of those losses. Other digital assets also slid, with Ethereum down 12%. Solana and Cardano each fell at least 17%, according to Coinbase.

“Margin positions being liquidated caused a wave of additional selling pressure, as assets that had been held as collateral were forcibly sold to pay for margin loans,” said Hayden Hughes, chief executive officer at Alpha Impact in Singapore.

“I would expect it to take some time for a bottom to form and for confidence to return, before expecting any sort of bullishness.”

With the US Federal Reserve moving to withdraw stimulus from the market and rein in inflation, riskier assets the world over have suffered, rocking both cryptocurrencies and stocks. A dominant theme has emerged in the digital-asset space: cryptos have moved in the same way as equities and many other risky assets.

“Crypto is, of course, vulnerable to these sorts of selloffs given its naturally higher volatility historically, but given how large market caps have gotten, the volatility is worth thinking about both in raw dollar terms as well as in percentage terms,” Bespoke analysts wrote.

“Crypto is reacting to the same kind of dynamics that are weighing on risk assets globally,” said Stephane Ouellette, chief executive and co-founder of the institutional crypto platform FRNT Financial. “Unfortunately for some of the mature projects like BTC (Bitcoin), there is so much cross-correlation within the crypto asset class it’s almost a certainty that it falls, at least temporarily in a broader alt-coin valuation contraction.”

Crypto-centric stocks also dropped on Friday, with Coinbase at one point losing nearly 16% and falling to its lowest level since its public debut in the spring of 2021.

Meanwhile, more than 239,000 traders had their positions closed over the past 24 hours, with liquidations totalling roughly $874 million, according to data from Coinglass, a cryptocurrency futures trading and information platform.

Though liquidations have spiked, the numbers are relatively muted when compared to previous declines, according to Noelle Acheson, head of market insights at Genesis Global Trading.

Kara Murphy, chief investment officer at Kestra Investment Management, said cryptocurrencies have a life of their own but that the recent slump is rational.

“It makes sense as people start to retrench a little bit, look for something that’s a little bit more solid, they’re gonna move away from crypto,” she said. “On the margin, with folks becoming more risk-averse, crypto will suffer from that.”