3 min read
Bitcoin’s price has dropped below the key $95,000 support level, causing a ripple effect across the crypto market. As a result, other cryptocurrencies like Ethereum, Solana, and XRP have also seen a decline. The main reason behind this crash is the overall market uncertainty, driven by multiple factors.
Why Are Bitcoin, Ethereum, Solana & XRP Falling?
According to sources, the crypto market is undergoing another crisis as Bitcoin struggles to maintain its value above $95,000, a key psychological level. This downturn has affected multiple altcoins, including Ethereum, Dogecoin, Solana, and XRP, leading to a widespread market slump.
Several key factors are contributing to this decline:
- Trade War Fears: US President Donald Trump’s stance on foreign tariffs has created economic instability. His recent announcement about imposing reciprocal tariffs has fueled uncertainty in global markets, affecting investor confidence.
- Federal Reserve Policies: The US Federal Reserve’s ongoing quantitative tightening has limited market liquidity. Investors anticipate only one interest rate cut later this year, which is unlikely to provide significant relief.
- Investor Sentiment: With Bitcoin struggling to reclaim the $100,000 mark, traders are now more concerned about it potentially falling toward $90,000. This fear has led to increased selling pressure.
Key Factors Driving the Market Down
Other events have contributed to the crypto market fall, in addition to macro-level anxiety. Bitcoin and Ethereum have seen a 30% dip in capital inflows in the last month, falling from $45 billion to $30 billion, according to crypto expert Ali Martinez.
This suggests that market liquidity is insufficient to support current price levels. It appears that investors are hesitating to allocate additional capital to the market because of the negative attitude. Rather, more and more investors are trying to cash out their coins, probably because the market was already priced in Donald Trump’s government before he ever took office.
Furthermore, some members of the community feel that the Trump administration has failed to deliver on its pledges to the cryptocurrency business, especially since the Strategic Bitcoin Reserve program has not materialized.
Amid this crash in the cryptocurrency market, Martinez has also said that prices could go down because long price drops have happened in the past when Bitcoin mining activity dropped.
Aside from the Bitcoin ecosystem, the LIBRA meme coin rug pull appears to have also reached an all-time high (ATH) in adverse attitude towards Solana. The rug pulled drained liquidity from the cryptocurrency market even further, as traders supposedly lost more than $286 million.
Given that President Javier Milei of Argentina supported this meme coin on his X account, investors’ confidence has been further weakened by this incident. This story has brought up memories of the TRUMP and Melania joke coins, which dried up the market right before Trump took office.
Massive Liquidations Deepen the Sell-Off
The ongoing sell-off has led to over $300 million being withdrawn from the cryptocurrency market in the past 24 hours, according to sources.
- Long positions suffered losses exceeding $279 million
- Short positions recorded losses of just over $55 million
With investor confidence shaken and liquidity drying up, the crypto market remains under immense pressure. Whether Bitcoin can regain its footing or falls further toward $90,000 will be a key factor in shaping the market’s next move.
