Crypto Market Cap in Peril: $140 Billion Exit Threatens $3T Mark

The total crypto market capitalization is dangerously close to dropping below $3 trillion, following a rapid $140 billion market exodus. The metric hit a three-week low of $3.02 trillion, with Bitcoin (BTC) leading the decline in a highly volatile session.

BTC lost support at $90,000, tumbling nearly $5,000 to $85,200—its lowest point since December 2nd. It was struggling to recover below $86,000 during the Tuesday morning Asian session.

🏛️ US Legislation Delay Blamed

The primary catalyst for the dump appears to be the unexpected delay in key crypto market structure legislation in the United States. A US Senate Banking Committee spokesperson announced that the crucial bipartisan markup will not happen this year, pushing the legislation—which grants the CFTC authority over spot markets—until early 2026. This dashed industry expectations for quick regulatory clarity.

🐻 Analysts Warn of Extreme Stress

Analysts point to mounting bearish pressure:

Derivatives & OI: Analyst ‘Sykodelic’ blamed high Open Interest (OI) in derivatives, noting the largest spike in six weeks. The $2 billion in OI at the $85,000 strike price on Deribit suggests short sellers will amplify downside pressure if the price falls further.

Market Stress: James Check observed that "Bitcoin market stress is now the highest we’ve seen since the 2022 bear," citing $100 billion in unrealised losses and 60% of US spot ETF inflows now underwater.

Geopolitics: Analyst ‘NoLimit’ also pointed to renewed China regulation on Bitcoin mining and potential actions by the Bank of Japan adding to the downside.

The combination of regulatory disappointment and high leverage means the market is on high alert, fighting to hold the $3 trillion boundary.