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The global digital asset market saw a major decline on Thursday as major financial markets registered a bad day. New York Community Bancorp (NYCB) witnessed a sharp decline of up to 46%, marking its lowest point in over two decades. With this, the <a href="https://news.todayq.com/no-relief-for-crypto-in-india-interim-budget-keeps-30-tax-1-tds/" target="_blank" rel="noopener noreferrer nofollow">crypto market cap</a> dropped by around 2% in the last 24 hours to stand at $1.62 trillion. Crypto market reacts to stock market plunge 
According to reports, the downturn occurred in response to the bank’s decision to slash its dividend and report an unexpected loss in the fourth quarter. NYCB had acquired assets from the failed lender Signature Bank the previous year.
The bank cited the need to build capital in anticipation of potential heightened regulations as a reason for the dividend reduction. This move triggered negative sentiment in the market. This impacted other bank stocks. Valley National Bancorp (VLY) shares also fell by 10%, while the KBW Regional Banking Index recorded its biggest one-day drop since May if sustained.
Bitcoin, the biggest crypto, dropped by 2% over the last 24 hours to drop below the $42k price level. BTC is trading at an average price of $41,974, at the press time. Its 24 hour trading volume is up by 12% to stand at $24.8 billion. What’s led to this decline? 
Brian Mulberry, Client Portfolio Manager at Zacks Investment Management, highlighted the emotional nature of the regional banking sector. He noted that depositors can be easily spooked. This can lead to abrupt market reactions. Higher interest rates have been contributing to earnings and NII pressures for these banks.
Surprisingly, the market seemed caught off guard by the sell-off. Traders in options linked to the SPDR S&amp;P regional bank exchange-traded fund (ETF) had previously positioned themselves with a bullish view. However, on Wednesday, options trading at four times their usual pace indicated investors preparing for a more pessimistic outlook.
Concerns were further surfaced as the Federal Reserve chose to leave interest rates unchanged. The impact of high rates which are aimed at controlling inflation has weighed on regional bank loan profits and the value of securities held.
While NYCB’s troubles were viewed by some as specific to its balance sheet, causing the stock plunge, others suggested that the broader banking sector did not exhibit the same level of pressure seen in March of the previous year.
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Crypto market takes hit over NYCB’s unexpected move, Crash imminent?

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