Attention! Big market is coming! The current big drop may just be the beginning!
First, let's look at the "culprit" of this plunge - tariff policy. The Trump administration recently announced a series of tariff policies, imposing high tariffs on imports from Canada, Mexico, the European Union and China. This move undoubtedly dropped a bombshell on the global trade market, triggering market concerns about future economic growth slowdown.
Imagine that global trade is like a giant board game, and the Trump administration is the player who suddenly changes the rules. This uncertainty makes investors anxious about rising inflation, declining consumer purchasing power, and slowing economic growth. As a result, they sell their cryptocurrencies, causing a sharp deterioration in market sentiment.
Hedge Funds: Market Cleaners
In addition to tariff policies, the massive sell-off by hedge funds is also one of the driving forces of the plunge. Recently, hedge funds have cut their cryptocurrency ETF holdings, triggering large-scale market liquidations. In the past 24 hours, the liquidation amount in the cryptocurrency market exceeded $1.34 billion, with Bitcoin and Ethereum liquidations accounting for the majority of the share.
Imagine that hedge funds are like a group of "scavengers" who quickly withdraw when the market is turbulent, leaving a mess behind. As the number of liquidations rises sharply, market sentiment further deteriorates, and the Crypto Fear and Greed Index remains in the extreme fear zone, reflecting that investors' confidence is seriously shaken.
Overall market impact: Volatility increases, asset prices continue to fall
This market turmoil is not limited to Bitcoin and Ethereum, other digital assets have also suffered sharp declines. Assets such as XRP, Dogecoin, BNB and Solana have generally fallen between 7% and 11%. The total market value of the entire cryptocurrency market has fallen by 7.25% to $2.65 trillion.
Bitcoin and Ethereum continue to trend downwards, with current prices at $79,000 and $2,100, respectively, down between 7% and 10%. For Bitcoin, $80,000 has become an important support level, while Ethereum is testing the key support level of $2,100.