Bitcoin (BTC) has plummeted to a new yearly low of $80,100, marking a 5% daily drop, while Ethereum (ETH) has fallen 8% to $2,150, its lowest level in 14 months. The downturn comes as risk-averse sentiment grips both traditional and crypto markets.
According to CoinGecko, Bitcoin has not seen such levels since early 2025, raising concerns about a prolonged bearish trend.
Market-Wide Liquidations Cross $220M
The crypto sell-off triggered over $220 million in liquidations within an hour, with Bitcoin long positions accounting for nearly half of the total, according to CoinGlass.
Although this figure remains below the $600 million in liquidations reported earlier this week, the trend signals a declining investor appetite for risk assets.
Key Factors Behind the Crypto Slump
ETF Outflows and Investor Uncertainty
Crypto analysts cite declining demand for U.S. spot Bitcoin ETFs as a major catalyst. Pav Hundal, lead market analyst at Swyftx, told Decrypt:
“We’ve gotten used to U.S. ETFs picking up the slack and that’s not happening right now. Instead, we’ve watched value exit funds at record levels over the last seven trading days.”
Global Markets Under Pressure
The crypto market downturn coincided with a broad sell-off in equities, as the S&P 500 fell 1.6%, the Nasdaq Composite dropped 2.8%, and the Dow Jones Industrial Average slid 0.4%.
A significant contributor to this negative sentiment is concern over potential tariffs from U.S. President Donald Trump on imports from the EU, Mexico, and Canada. Analysts warn that such tariffs could increase inflationary pressures, though some argue they might boost domestic industries.
Geopolitical and Economic Concerns
Market sentiment remains fragile due to the ongoing war in Ukraine and the broader shift of capital into U.S. Treasuries and the dollar as investors seek safe-haven assets.
Is There Hope for a Crypto Rebound?
Despite the bearish momentum, Hundal believes that upcoming U.S. inflation data could inject optimism into the markets if it “surprises to the downside.”
“Monetary policymakers in the U.S. are looking at two things right now: the labor market and inflation progress,” he added.
A lower-than-expected inflation reading could ease market concerns and support a recovery in both crypto and traditional assets.
What’s Next for Bitcoin and Ethereum?
If Bitcoin fails to hold the $80K support level, analysts warn of further declines toward $75K. On the other hand, if positive macroeconomic data emerges, a relief rally toward $85K or higher could be on the horizon.
For Ethereum, breaking past $2,200 resistance will be key in determining its next move.
Disclaimer: This article is for informational purposes only and does not constitute financial or legal advice. Cryptocurrency investments carry risks, and readers should conduct their own research before making any decisions.
