The crypto market faced a major correction this week, with Bitcoin and Ethereum leading a sharp sell-off. Traders lost billions within hours.
Bitcoin (BTC) dropped nearly 7.5% to $112,578, while Ethereum (ETH) fell 13% to $3,799. This followed Bitcoin’s brief rally to $125,456 earlier in the week. Analysts say the decline could signal a healthy reset in the ongoing 2025 bull cycle.
Data from CoinGlass showed over $5.6 billion in leveraged long positions were liquidated in 24 hours. This event is among the largest single-day liquidations this year. Analysts now see $109,000–$114,000 as Bitcoin’s critical support zone. Ethereum traders are watching $3,500 for signs of a rebound.
The sell-off intensified after the U.S. announced 100% tariffs on Chinese tech imports, raising fears of a renewed trade war. The U.S. dollar index (DXY) rose above 107, and the 10-year Treasury yield hovered near 4.65%, tightening liquidity for speculative assets like crypto.
Institutional investors de-risked positions, causing a sharp contraction in crypto market trading volumes. Experts warn that crypto assets may remain under pressure until trade tensions ease and the dollar weakens.
Spot ETF approvals for Solana and XRP were also delayed due to the U.S. government shutdown. Solana dropped from $218 to $172 after the delay. Despite setbacks, crypto ETFs have attracted over $18 billion in inflows since January 2025, showing investor demand remains strong.
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Altcoins faced significant losses, with some dropping up to 80% in hours. Analysts say the crash cleared overleveraged positions and drained excess liquidity. This reset is expected to strengthen the market for the next bull phase.
Experts note that corrections like this are normal during bull cycles. If Bitcoin holds above $109,000, the crypto market could stabilize and begin a new accumulation phase, potentially leading to altcoin gains.
