The cryptocurrency market experienced a severe downturn, shedding over $130 billion from its total capitalization in a single day. The sell-off was broad-based, impacting leading assets like Bitcoin (BTC) and Ethereum (ETH) alongside major altcoins.
Bitcoin's price fell below the critical $71,000 level, dropping to around $70,800 at its lowest point. This decline represents a significant retreat from recent highs and has been attributed to a combination of profit-taking by traders and heightened market volatility. Analysts point to several contributing factors for the sharp correction: hawkish commentary from central banks stoking fears of interest rate hikes, low market liquidity amplifying price moves, and technical breakdowns where major tokens breached key support levels, triggering cascading liquidations.
Market sentiment has turned sharply bearish, with data showing spikes in liquidations and outflows from centralized exchanges. The overall downturn follows a period of negative macroeconomic signals and broader investor uncertainty. While long-term sentiment for assets like Bitcoin remains underpinned by strong institutional ETF flows, the immediate outlook is dominated by caution as investors await key economic data, including upcoming U.S. inflation reports and Federal Reserve policy decisions.
