Why Crypto Price Crash: Bloody Market Collapse?

Bittime - In recent days, the crypto market experienced a major shock that caused the prices of Bitcoin and major altcoins to fall drastically. 

This decline was not only influenced by internal factors in the crypto market, but also increasingly uncertain global economic conditions. Here are some of the main reasons behind this latest crash.

Check out the reasons behind the crypto price crash, causing the market to continue to fall in this article!

Massive Sales Wipe Out Billions in Profits

The crypto market recently experienced a sharp decline that wiped out most of the previous gains made in the past week. Bitcoin (BTC), which previously traded close $88.000, plummeted to $83.800, recorded a decline of 3.8% in 24 hours. 

Major altcoins like Avalanche (AVAX), Polygon (POL), Near (NEAR), dan Uniswap (UNI) also decreased almost 10%, exacerbating the sell-off in the market. Overall, crypto market capitalization experienced a drastic decline of $115 billion in a short time.

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Ethereum Performance Reaches Lowest Level

One of the most worrying aspects of this crash is performance Ethereum (ETH) which is weaker than Bitcoin. Ethereum is experiencing a decline of more than 6%, hitting its lowest level against BTC since May 2020. 

One of the main causes is weak demand for Ethereum ETF, which has received no new cash flow since early March. On the contrary, ETF Bitcoin has attracted more than $1 billion in the last two weeks. 

The lack of investor interest in Ethereum raises concerns about its long-term prospects compared to Bitcoin.

Weakening US Stock Market Adds Pressure to Crypto

The downturn is not unique to the crypto market—traditional financial markets are also facing pressure due to economic concerns. S&P 500 Index falls 2%, temporary Nasdaq falls 2.8%, signaling increased investor uncertainty. 

Crypto-related stocks suffered deeper losses, with MicroStrategy (MSTR)—one of the largest corporate Bitcoin holders—crashed 10%, whereas Coinbase (COIN) turun 7,7%.

Weakening Economy Impacts Crypto Market

The latest economic indicators further exacerbate market uncertainty. Annual inflation rate rises 2.5%, while core inflation reached 2,8%, slightly higher than expectations. 

Besides that, consumer spending growth of only 0.4%, which indicates an economic slowdown. The Federal Reserve's GDPNow model estimates the US economy could shrink by up to 2.8% in the first quarter (Q1), sparking concerns about  stagflasi. 

Plus, New US import tariffs that will take effect April 2 further increasing uncertainty, which impacts the market as a whole.

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Will Bitcoin Drop Further? Market Analysis

Bitcoin's decline is actually not entirely surprising. Many traders have expected a price correction as a result CME futures gap, a phenomenon where BTC tends to re-test previously untouched price levels. 

Historically, corrections like this often trigger further declines if global economic conditions remain weak. Because Bitcoin has correlation with Nasdaq, a continued decline in the US stock market could result bigger loss for crypto.

Although the short-term trend remains bearish, some analysts remain optimistic. Analytics firm Saintly noted that Bitcoin is still capable keeping a small weekly increase around $84,300, indicating a potential shift in its correlation with traditional financial markets. 

If this trend continues, Bitcoin may increase regardless of stock market cycles, different from 2022 when the movement is very tied to the stock market.

What is next? Expert Predictions on the Future of Crypto

Looking ahead, experts have mixed views on the direction of the crypto market. Joel Kruger, a strategist at LMAX Group, believes that the increasingly widespread adoption of crypto and the increasing involvement of large financial institutions can helps stabilize the market. 

He estimated that Bitcoin has strong support in the $70,000–$75,000 range, which could prevent a deeper decline and open up opportunities rebound at the end of this year.

On the other hand, analis cripto Michaël van de Poppe warns that Bitcoin lose momentum, with liquidity level below $84K in risky conditions. If BTC fails to maintain this support level, the market could suffer further decline over the next week before finding balance.

With inflation uncertainty, stock market volatility, and global economic tensions still ongoing, investors remain vigilant in dealing with future crypto market movements.

FAQ 

1. Why are crypto prices, including Bitcoin and Ethereum, experiencing sharp declines?

The decline in crypto prices is due to several key factors, including a massive selloff that wipes out the neighborhood $115 billion of total market capitalization. In addition, there is weak interest in Ethereum ETF, while Bitcoin continues to attract investment via ETFs. External factors such as US stock market correction, higher than expected inflation, And global economic concerns also made the situation worse.

2. Was Bitcoin's fall predicted beforehand?

Yes, some analysts have predicted a Bitcoin price correction due to this CME futures gap, which is a price gap that BTC frequently retests. Additionally, Bitcoin has close correlation with Nasdaq, so that when the US stock market experiences a significant decline, BTC prices also tend to weaken. 

3. What is the long-term outlook for the crypto market after this crash?

Widespread crypto adoption And involvement of large financial institutions believed to help stabilize the market. Bitcoin is expected to have strong support in the $70,000–$75,000 range, which could be a turning point for recovery. However, investors are still advised to be careful and monitor global economic developments before making investment decisions.

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Check the exchange rate BTC to IDR, ETH to IDR, SOL to IDR and other crypto assets to find out today's crypto market trends in real-time on Bittime.

Also, visit the Bittime Blog for interesting updates and educational information about the crypto world. Find reliable articles about Web3, blockchain technology, and digital asset investment tips designed to enrich your crypto knowledge.

Reference

Kadir AK, Why is Crypto Crashing? Ethereum Price Hits 4-Year Low Against BTC, accessed March 31, 2025

News Room, Crypto Crash Alert! Why Is Ethereum at a 4-Year Low Against Bitcoin?, accessed March 31, 2025

Writer: SD