The cryptocurrency market experienced a sharp decline at the end of May 2025, with the value of Bitcoin dropping below $106,000, leading to a total market capitalization decrease of 2.12% to $3.34 trillion.
Main reasons for the market crash:
1. Geopolitical and economic pressures: Global tensions and economic uncertainty have increased, prompting investors to avoid high-risk assets like cryptocurrencies.
2. Massive liquidations: Nearly $335 million worth of trading positions were liquidated in 24 hours, including currencies like BTC, ETH, and SOL, increasing selling pressure.
3. Profit-taking by large investors: Bitcoin exchange-traded funds saw outflows of $346.8 million on May 29, indicating that large investors were taking profits.
4. Negative technical effects: Technical indicators such as negative MACD crossovers and price drops below moving averages have heightened negative market expectations.
5. Regulatory uncertainty: Some promised regulatory policies, such as the 'Strategic Bitcoin Reserve' plan, have been delayed, affecting investor confidence.
Future outlook:
Despite the current downturn, there remains optimism among large investors regarding Bitcoin's long-term value. However, the market may remain volatile in the short term due to the mentioned factors.
For investors, caution is advised, and closely monitoring economic and regulatory developments is essential, with a focus on risk management strategies.
