Why Crypto Market Is Crashing?
The crypto market is experiencing a downturn due to a combination of macroeconomic and market-specific factors. Here are the key reasons based on recent insights:
- Stalled US-China Trade Talks:
Renewed fears over stalled trade negotiations, particularly after US Treasury Secretary Scott Bessent’s confirmation of halted talks, have dampened investor sentiment, triggering a risk-off mode in markets. This led to a 2.6% drop in the total crypto market cap to $3.34 trillion on May 30, 2025.
- Significant Liquidations in Futures Market:
Over $683.4 million in crypto futures were liquidated in the last 24 hours, with $617.85 million from long positions, exacerbating price drops. Bitcoin and Ethereum saw the highest liquidations at $211.21 million and $112.53 million, respectively, intensifying selling pressure.
- Technical Weakness:
The market broke below a key support level at $3.35 trillion, with the relative strength index (RSI) dropping to 52 from overbought conditions, signaling increased downward pressure. If the market falls below $3.22 trillion, it risks dropping to $3.1 trillion.
- Macroeconomic Factors:
Rising US Treasury yields and tighter monetary policies make safer investments like bonds more attractive, reducing interest in riskier assets like cryptocurrencies. Additionally, concerns about inflation and potential recession risks contribute to the bearish outlook.
Stay tuned for further market insights.
