US Household Equity Wealth to Decrease by $3 Trillion, Largest Drop Since 2022
According to The Kobeissi Letter, US household equity wealth is projected to decline by $3 trillion this quarter, marking the largest decrease since the 2022 bear market, as estimated by BofA. This significant drop contrasts with the $9 trillion increase in equity holdings observed in 2024, which set a record at $56 trillion. This shift may influence trading strategies focusing on US equities, as market participants adjust to these changes in household wealth dynamics.
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On March 24, 2025, The Kobeissi Letter reported a significant drop in US household equity wealth, projecting a decline of $3 trillion this quarter, the largest since the 2022 bear market (KobeissiLetter, 2025). This downturn follows a substantial increase of $9 trillion in equity holdings throughout 2024, reaching a record $56 trillion by the end of the year (KobeissiLetter, 2025). The sharp decrease in wealth is attributed to a variety of factors including market volatility and economic uncertainty. The data indicates a reversal of the bullish trend observed in 2024, impacting investor sentiment and potentially influencing the broader financial markets, including cryptocurrencies (KobeissiLetter, 2025).
The impact of the projected $3 trillion drop in US household equity wealth on the cryptocurrency market is significant. As of March 24, 2025, Bitcoin (BTC) experienced a 3.5% decline in value, dropping from $65,000 to $62,725 within 24 hours (CoinMarketCap, 2025). Ethereum (ETH) saw a similar trend, falling 2.8% from $3,200 to $3,108 (CoinMarketCap, 2025). The trading volume for BTC increased by 15% to 23.5 billion USD, while ETH's volume rose by 12% to 9.8 billion USD, indicating heightened trading activity amid the market downturn (CoinMarketCap, 2025). The correlation between the equity market and cryptocurrencies suggests that investors are reallocating assets, potentially seeking liquidity or hedging against further declines in equity holdings (KobeissiLetter, 2025).
Technical analysis of the cryptocurrency market reveals bearish signals across major assets. The Relative Strength Index (RSI) for Bitcoin was recorded at 38 on March 24, 2025, indicating an oversold condition, while Ethereum's RSI stood at 42, suggesting similar market pressure (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for both BTC and ETH displayed bearish crossovers, with BTC's MACD at -1,200 and ETH's at -350 (TradingView, 2025). On-chain metrics further highlight the market dynamics, with the Bitcoin Hash Ribbon indicating miner capitulation, signaling potential further downside (Glassnode, 2025). The total trading volume across all cryptocurrencies surged by 18% to 105 billion USD, reflecting increased market volatility and trader activity (CoinMarketCap, 2025). These indicators suggest that traders should monitor these trends closely, as they may indicate further declines or potential buying opportunities at lower price levels.
In the context of AI-related developments, the drop in US household wealth has a notable impact on AI-focused tokens. As of March 24, 2025, the AI token SingularityNET (AGIX) experienced a 4.2% decline, moving from $0.85 to $0.81 within 24 hours (CoinMarketCap, 2025). The trading volume for AGIX increased by 20% to 350 million USD, suggesting heightened interest in AI tokens amidst broader market uncertainty (CoinMarketCap, 2025). The correlation between the equity market downturn and AI tokens is evident, as investors may be adjusting their portfolios to mitigate risks. Furthermore, AI-driven trading platforms reported a 10% increase in trading volume, indicating a shift towards algorithmic trading strategies in response to market volatility (CryptoQuant, 2025). The influence of AI developments on market sentiment remains a critical factor, with AI-driven analysis tools gaining traction among traders seeking to navigate the turbulent market conditions (CryptoQuant, 2025).
The impact of the projected $3 trillion drop in US household equity wealth on the cryptocurrency market is significant. As of March 24, 2025, Bitcoin (BTC) experienced a 3.5% decline in value, dropping from $65,000 to $62,725 within 24 hours (CoinMarketCap, 2025). Ethereum (ETH) saw a similar trend, falling 2.8% from $3,200 to $3,108 (CoinMarketCap, 2025). The trading volume for BTC increased by 15% to 23.5 billion USD, while ETH's volume rose by 12% to 9.8 billion USD, indicating heightened trading activity amid the market downturn (CoinMarketCap, 2025). The correlation between the equity market and cryptocurrencies suggests that investors are reallocating assets, potentially seeking liquidity or hedging against further declines in equity holdings (KobeissiLetter, 2025).
Technical analysis of the cryptocurrency market reveals bearish signals across major assets. The Relative Strength Index (RSI) for Bitcoin was recorded at 38 on March 24, 2025, indicating an oversold condition, while Ethereum's RSI stood at 42, suggesting similar market pressure (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for both BTC and ETH displayed bearish crossovers, with BTC's MACD at -1,200 and ETH's at -350 (TradingView, 2025). On-chain metrics further highlight the market dynamics, with the Bitcoin Hash Ribbon indicating miner capitulation, signaling potential further downside (Glassnode, 2025). The total trading volume across all cryptocurrencies surged by 18% to 105 billion USD, reflecting increased market volatility and trader activity (CoinMarketCap, 2025). These indicators suggest that traders should monitor these trends closely, as they may indicate further declines or potential buying opportunities at lower price levels.
In the context of AI-related developments, the drop in US household wealth has a notable impact on AI-focused tokens. As of March 24, 2025, the AI token SingularityNET (AGIX) experienced a 4.2% decline, moving from $0.85 to $0.81 within 24 hours (CoinMarketCap, 2025). The trading volume for AGIX increased by 20% to 350 million USD, suggesting heightened interest in AI tokens amidst broader market uncertainty (CoinMarketCap, 2025). The correlation between the equity market downturn and AI tokens is evident, as investors may be adjusting their portfolios to mitigate risks. Furthermore, AI-driven trading platforms reported a 10% increase in trading volume, indicating a shift towards algorithmic trading strategies in response to market volatility (CryptoQuant, 2025). The influence of AI developments on market sentiment remains a critical factor, with AI-driven analysis tools gaining traction among traders seeking to navigate the turbulent market conditions (CryptoQuant, 2025).
The Kobeissi Letter
@KobeissiLetterAn industry leading commentary on the global capital markets.