Reasons why the crypto market is down today, see this analysis!

Bittime - The cryptocurrency market experienced a significant decline at the start of this week. The market capitalization fell from $3.3 trillion to $3.15 trillion, wiping out about $150 billion in three days. Some major assets such as Solana (SOL) and So, what caused this decline? Below are some of the main factors influencing current market conditions.

LIBRA Scandal and Its Impact on Market Sentiment

One of the main causes of the market decline was the scandal involving the meme coin LIBRA, which was linked to the President of Argentina, Javier Milei. This scandal has increased distrust among investors towards crypto projects, especially meme coins and altcoins. LIBRA worsens market sentiment which is already weak due to global economic uncertainty. With Bitcoin's increasing dominance, altcoins such as Ethereum and Solana are finding it increasingly difficult to experience significant price increases.

Bitcoin's Rising Dominance

Bitcoin now dominates more than 60% of the crypto market, a figure that shows a significant upward trend. Even though Bitcoin is only down less than 3% in the last three days, this high dominance is putting further pressure on altcoins. When Bitcoin leads the market, altcoins often struggle to post a rebound. This adds pressure to altcoin investors who are hoping for a potential price increase. In fact, Bitcoin's stability below $100,000 over the past two weeks suggests there is a limit to BTC's price upside potential.

Also read: Today's Pi Network Price According to the Latest Data, How Much Is PI Coin Rupiah?

Macroeconomic Uncertainty

Apart from internal factors in the crypto market, macroeconomic uncertainty also had an impact on this decline. The hawkish policy of the Federal Reserve, which keeps interest rates high to suppress inflation, adds to uncertainty in global markets. Talk from the Fed Governor, Patrick Harker, about interest rates remaining high until inflation is under control, worsened already depressed market sentiment. This results in investors becoming more careful and reluctant to take big risks in the highly volatile crypto market.

Future Bitcoin Market Predictions

Amid this market downturn, some analysts remain optimistic about Bitcoin's medium-term prospects. Analysts from Bernstein predict that Bitcoin will enter its next bull run, driven by a number of positive catalysts that support its long-term outlook. Even though the crypto market is currently sluggish, Bitcoin's long-term upside potential remains, especially if positive factors emerge in the near future.

Also read: PEPE Coin Price Prediction 2025 – 2031: Analysis and Price Target

Conclusion

Today's crypto market decline was caused by several interconnected factors, such as the LIBRA scandal, Bitcoin's increasingly strong dominance, and global macroeconomic uncertainty. Although this situation is pressuring the prices of many altcoins, analysts still see Bitcoin's upside potential in the long term. For investors, it is important to continue to monitor market developments and prepare a careful strategy considering high volatility.

FAQ

1. Why is the crypto market down today?

The crypto market experienced a downturn due to the LIBRA scandal exacerbating negative sentiment towards altcoins, Bitcoin's increasing dominance, and macroeconomic uncertainty weighing on the overall market.

2. What impact will Bitcoin's dominance have on altcoins?

Bitcoin's increasing dominance is causing altcoins to struggle to rebound. When Bitcoin dominates the market, altcoins tend to be depressed and experience larger price drops.

3. Will the crypto market recover?

Despite the crypto market's downturn, some analysts remain optimistic about Bitcoin's medium-term prospects. They predict that Bitcoin could enter a bull market phase again when several positive factors support price movements.

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Reference

Ambcrypto, Why is crypto down today – Analyzing key factors behind the market trend, accessed 19 February 2025.

Author: MF