📉 Key Reasons Behind the Crypto Downturn
Based on recent news and market analysis, here are the major factors contributing to the decline:
1. Geopolitical Instability in the Middle East
Renewed tensions and military actions between Israel and Iran have triggered risk-off sentiment. Investors are unloading risk assets—including crypto—as uncertainty rises .
The conflict is also boosting oil & gold prices, further drawing capital away from cryptos .
2. Liquidations in Futures Markets
Over $1 billion in long positions were liquidated across crypto futures (e.g., BTC, ETH) amid recent declines .
These forced sell-offs exacerbate price drops, creating a cascading effect.
3. Macro‑Economic Uncertainties & Fed Stance
The U.S. Federal Reserve paused interest rate hikes, but maintained a hawkish tone—raising concerns that further gains may be limited for risk assets .
Mixed economic data, potential inflation resurgence, and tariff concerns—especially under the Trump-era trade policies—add to investor caution .
4. Surge in Trading Volume Amid Price Drop
Despite prices falling, trading volume surged by ~30%, showing heightened activity. This suggests volatility and possible opportunistic trades or panic selling .
