The crypto market experienced a downturn yesterday morning, resulting in significant losses across various altcoins. Prominent cryptocurrencies such as EOS, Polygon, and Dash suffered the largest setbacks, with each recording declines between 24% and 25%.

Higher-ranking coins, including Cardano and Solana, were also affected, facing drops of 23% and 20%, respectively.

Notably, many of the tokens experiencing the most significant losses were also among those labeled as securities in recent lawsuits filed by the Securities and Exchange Commission (SEC) against leading crypto exchanges, Coinbase and Binance. This group included Polygon, Cardano, Solana, Dash, and The Sandbox.

Bitcoin and Ether, the two largest cryptocurrencies in terms of market capitalization, experienced relatively milder declines, with a 3% and 5% decrease, respectively.

However, Binance CEO Changpeng Zhao refuted one speculated reason for the market crash on Twitter, dismissing claims that the exchange had converted its crypto holdings to fiat.

Instead, he clarified that Binance’s stablecoin reserves, used for salary payments and expenses, had decreased, while the exchange’s crypto reserves had increased.

Altcoins Bear the Brunt:

Among the top 100 cryptocurrencies, altcoins faced significant losses during the recent market crash. Leading the pack, EOS, Polygon, and Dash saw substantial declines ranging from 24% to 25%. These altcoins’ vulnerability to the market downturn reflects the overall sentiment prevailing among investors.

Impact of SEC Lawsuits:

The recent SEC lawsuits targeting major crypto exchanges have had a profound impact on the market. Several tokens that experienced severe losses, including Polygon, Cardano, Solana, Dash, and The Sandbox, were specifically mentioned as securities in the legal actions. This regulatory scrutiny has heightened market uncertainty, leading to heightened selling pressure on these tokens.

Bitcoin and Ether Display Resilience:

While Bitcoin and Ether also faced declines during the market crash, their losses were comparatively less severe. Bitcoin witnessed a 3% decline, while Ether experienced a 5% drop. These flagship cryptocurrencies, with their established market presence and higher liquidity, demonstrated relative resilience amid the broader market downturn.

Binance CEO Sets the Record Straight:

Binance CEO Changpeng Zhao addressed speculations regarding the market crash, refuting claims that the exchange had converted its crypto holdings to fiat.

Zhao clarified that the decrease in Binance’s stablecoin reserves, rather than a conversion to fiat, accounted for the observed changes. He emphasized that the exchange’s crypto reserves had actually increased during this period.