The crypto market saw pressure early on in the month as investors weighed the risks of the latest DeFi hack and a ruling from a federal court delineating when crypto assets should be considered securities. Bitcoin was 1.1% lower on Tuesday to $28,867.96, and it ended July 3.93% in the red. Ether, currently considered a sort of large-cap, blue-chip trade in the crypto market, had a 1.4% decline and finished the month 3.35% down. This price decline was intensified by the recent exploit on DeFi giant Curve. Analyst Josh Gilbert of investment firm eToro commented that Ethereum, a major liquidity provider in the DeFi space, will not be subjected to the same amount of pressure as smaller altcoins are, yet the Curve issue is the cause of the current Ethereum weakness.
Altcoins saw a further drop after a federal judge said that some crypto assets should be treated as securities, contradicting an earlier ruling from the same court that Ripple's XRP may not always be classified as a security. XRP had a 3% decrease, while tokens that had been identified by the SEC as potential securities, including those on the Solana and Cardano networks, fell by more than 2%. Polygon's matic token dropped 1.75%.
CRV, the native token of Curve Finance, a stablecoin-focused decentralized exchange, was down 2.8% over the past 24 hours. Aave, Compound and the Synthetix network tokens dropped by 9%, 10% and 7.3%, respectively, due to a bug in the smart contract programming language Vyper that enabled a hacker to extract more than $100 million worth of cryptocurrency from the platform, including $20 million of CRV.
Despite the strength of bitcoin this year, volumes declined significantly from their recent highs and have yet to regain them. Bitcoin traded in a tight range throughout July, without going above the crucial $31,500 level or below $25,200 while still climbing 74% on the year. According to Gilbert, the initial optimism caused by the Blackrock ETF dissipated, causing bitcoin and most altcoins to drop further as a result of the Curve incident.
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