Bitcoin on fire: Market panic selling, what's happening?
🔥 1. Macro Factors
This is the biggest driver of money flowing out of risky assets like crypto:
Uncertainty in the US Fed's Interest Rate Policy:
The market is losing confidence in the possibility that the US Federal Reserve (Fed) will soon cut interest rates (high interest rates make holding non-yielding assets like Bitcoin less attractive).
This sentiment is causing investors to turn risk-off on a global scale, dumping speculative assets.
Concerns about the "AI Bubble":
Many analysts and major financial institutions are expressing concerns about the overvaluation of tech and AI stocks.
If the tech/AI bubble bursts, it will lead to a widespread decline in risky assets, and crypto (which is highly speculative) is one of the first assets to be sold off.
📉 2. Internal Causes of Crypto Market
Bitcoin Breaks Key Level:
Bitcoin fell below $90,000 for the first time in about seven months, wiping out all the gains it made since early 2025.
The breach of key psychological and technical support levels like $100,000 and $90,000 triggered stop-loss orders and caused panic.
Large Liquidations and Over-Leverage:
The crypto market remains dominated by margin trading positions. As prices fall, leveraged longs are liquidated en masse, forcing holders to sell assets, creating a chain reaction of selling pressure.
This liquidation wiped out billions of dollars in leveraged positions in just a few weeks.
Weak ETF Flows:
After a strong run-up in spot Bitcoin ETFs, the market has recently seen weak outflows or inflows, removing a previously important source of demand.
Short-Term Capitulation:
On-chain data shows that the majority of the selling is coming from new investors (holding coins for less than 3 months). They are selling at a loss out of fear, not because long-term investors are taking large profits.
{future}(SOLUSDT)
{future}(BTCUSDT)
{future}(XRPUSDT)
This is the biggest driver of money flowing out of risky assets like crypto:
Uncertainty in the US Fed's Interest Rate Policy:
The market is losing confidence in the possibility that the US Federal Reserve (Fed) will soon cut interest rates (high interest rates make holding non-yielding assets like Bitcoin less attractive).
This sentiment is causing investors to turn risk-off on a global scale, dumping speculative assets.
Concerns about the "AI Bubble":
Many analysts and major financial institutions are expressing concerns about the overvaluation of tech and AI stocks.
If the tech/AI bubble bursts, it will lead to a widespread decline in risky assets, and crypto (which is highly speculative) is one of the first assets to be sold off.
📉 2. Internal Causes of Crypto Market
Bitcoin Breaks Key Level:
Bitcoin fell below $90,000 for the first time in about seven months, wiping out all the gains it made since early 2025.
The breach of key psychological and technical support levels like $100,000 and $90,000 triggered stop-loss orders and caused panic.
Large Liquidations and Over-Leverage:
The crypto market remains dominated by margin trading positions. As prices fall, leveraged longs are liquidated en masse, forcing holders to sell assets, creating a chain reaction of selling pressure.
This liquidation wiped out billions of dollars in leveraged positions in just a few weeks.
Weak ETF Flows:
After a strong run-up in spot Bitcoin ETFs, the market has recently seen weak outflows or inflows, removing a previously important source of demand.
Short-Term Capitulation:
On-chain data shows that the majority of the selling is coming from new investors (holding coins for less than 3 months). They are selling at a loss out of fear, not because long-term investors are taking large profits.
{future}(SOLUSDT)
{future}(BTCUSDT)
{future}(XRPUSDT)
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.
BTC
89,870.88
-0.28%