Crypto markets plunged on Tuesday in what analysts are calling the sector’s sharpest rout since February, as a confluence of tight dollar liquidity and renewed risk aversion, among others.
Bitcoin traded around $90,400 on Coinbase after briefly falling below the psychologically critical $90,000 level earlier in the session, erasing all gains made since April, Market Moves report stated.
The world’s largest cryptocurrency has shed 14 percent in the past seven days, mirroring a widespread slump across digital assets.
Ether dropped 15 percent, XRP slid 14 percent, BNB fell eight percent, while Solana led the declines with an 18 percent weekly plunge.
The selloff pushed the Fear and Greed Index to 15/100, reflecting extreme caution and marking the lowest sentiment reading since the market shocks that followed Trump’s Liberation Day announcement in April.
Analysts say sentiment has deteriorated rapidly as macro uncertainty deepens.
Spot Bitcoin ETFs logged another day of heavy withdrawals, with $255 million leaving the products on Monday, according to Farside Investors, extending a three-week streak of outflows that has amplified downward pressure on prices.
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MN Fund CIO Michaël van de Poppe warned that Bitcoin’s failure to maintain the $94,000 support zone “opens the door to a search for lower levels,” pointing to the CME gap as a potential target and predicting heightened volatility.
The turmoil in crypto mirrors a broader risk-off mood across global financial markets as investors reassess the likelihood of further Federal Reserve rate cuts this year. The S&P 500 is down 2.4 percent in November, its weakest month since March, while the Nasdaq Composite has plunged 4.3 percent.
Europe’s EuroStoxx 50 has slipped 1.7 percent, and Japan’s Nikkei has tumbled 6.9 percent, underscoring the global pivot away from risk assets.
Gold, typically a safe-haven hedge, has offered little shelter, falling 4.3 percent over the past week.
The market turbulence comes amid a rare data vacuum following a 43-day US government shutdown that suspended key economic releases. Traders are now bracing for Thursday’s jobs report, which is expected to reset expectations around Federal Reserve policy.
Dirk Willer, Citi’s head of macro strategy, said Bitcoin’s slump reflects a combination of sustained ETF outflows, trend-following pressure from institutional traders after key moving averages broke, and a sharp decline in dollar liquidity. He noted that US bank reserves have fallen by about $500 billion due to a rebuild of the Treasury General Account, tightening financial conditions and weighing heavily on risk assets such as crypto.
Willer added that liquidity could improve toward year-end if the Treasury slows or reverses its cash buildup.
Yassine Elmandjra, another market watcher, cautioned that on-chain activity has become a poor gauge of market health in this environment. He flagged concerns around a developing AI-driven equity bubble that has dragged down large-cap tech stocks—assets that often move in tandem with crypto.
He also pointed to renewed volatility from the yen carry trade, as shifts in Japanese yields attract investors to unwind positions, rippling across global markets.
