.png){kind=logo}
Bitcoin price fell 0.97% below $107,000 amidst falling institutional buying and caution.
Ethereum was down 3.02%, mirroring broader market weakness despite high trading volume.
The uncertainty in Fed policy and reduced ETF inflows affect crypto prices today.
Crypto prices today turned bearish as most big coins traded in the red zone. Bitcoin Price fell below the $107,000 mark, while Ethereum and other altcoins declined by over 3%. Investors seemed cautious after the global market sentiment weakened following mixed signals from the Federal Reserve over further rate cuts. Here’s why the crypto market is down today, based on CoinMarketCap data.
Bitcoin price was down 0.97% to trade at $106,791, while the market cap stood at $2.12 trillion. The world's largest cryptocurrency traded for $71.4 billion over the past 24 hours, suggesting cautious investor sentiment. Ethereum fell sharply by 3.02% to $3,624. It had a market capitalization of $437.4 billion with a trading volume of $48.7 billion.
Solana was one of the biggest losers in crypto prices today. The coin shedded 6.81% to $165.27. SOL remained the sixth-largest cryptocurrency by a market cap of $91.3 billion. XRP price fell 3.96% to $2.34, which trimmed its market capitalization to $140.7 billion.
BNB dropped 4.87% to $989.53 while Dogecoin decreased 2.86% to $0.1699. Cardano dipped 2.70% to $0.5585 while TRON was off 3.01% to $0.2842. The stablecoins Tether and USD Coin were flat near their $1 peg, as expected. The broad-based weakness suggested that crypto prices struggled to find support despite the recent highs in traditional equity markets.
Also Read: Crypto Prices Today: Bitcoin Price Slips to $107,785, Ethereum Down 4.25% as Market Turns Red
A number of different factors influenced crypto prices today. For the first time in seven months, institutional buying has fallen below the rate of new Bitcoin being created, says Charles Edwards from Capriole Investments. That's a signal that large buyers are pulling back and creating a more cautious environment.
The shift comes after October's sharp correction, which wiped out excess leverage from the system. While this reset was healthy long-term, rebuilding risk appetite takes time. Exchange data indicates that quick rallies are met with selling pressure as supply hits the market.
"October's correction has done what it needed to: it has flushed out leverage and reset sentiment," said Rachel Lin, chief executive officer of SynFutures. She added that the long-term holders aren't selling in panic, with the steady addition to positions and coins continuing to flow off exchanges, a prelude to a usually positive sign.
Macro headwinds are also affecting crypto prices today: The Fed cut interest rates last week as expected, but Chair Jerome Powell made it clear another cut in December isn't a done deal. That statement forced traders to dial back their expectations for aggressive rate cuts.
Market pricing reflects the probability of a 25-basis-point rate cut next month at 70%, from 94% just a week ago. The uncertainty around Fed policy is keeping risk assets like crypto under pressure. Delays in key economic data releases due to the continuing US government shutdown make predictions of the Fed's next move tough, adding to market nervousness.
On-chain metrics depicted below highlight the current market dynamic: Inflows to exchanges have been consistent, indicating that sellers are transferring coins onto trading platforms. Simultaneously, ETF flows for Bitcoin showed some signs of redemptions, further adding to supply concerns.
The good news is that long-term holders aren't capitulating. Wallet data shows sustained accumulation patterns, suggesting that experienced investors see the current pullback as a buying opportunity rather than a trend reversal.
Upgrades of the network and increased institutional interest in DeFi applications can help Ethereum. However, given the high correlations among major crypto assets, ETH will most probably follow Bitcoin's lead in the near term.
Analysts say November could be choppy as the market digests Fed commentary and waits for clearer economic signals. A softer inflation reading or a more dovish Fed message could spark a recovery rally.
Also Read: Bitcoin News Today: TradFi Takes Charge as Bitcoin Whales Shift $40 Billion
Analysts are predicting that the short-term volatility will persist as traders await clarity over Fed policy and inflation data. Smaller ETF redemptions and slower exchange inflows could stabilize crypto prices today above recent lows. For now, Bitcoin and Ethereum are very sensitive to macro developments. The market direction is likely to continue being dictated by institutional positioning and economic indicators.
1. Why is the crypto market down today?
A decline in institutional investing, profit-taking after the October run-up and indecision in US Federal Reserve rate decision-making are dragging risk assets lower and therefore the crypto market.
2. How much did Bitcoin and Ethereum fall?
Bitcoin was down 0.97% at $106,791 and Ethereum was down 3.02% at $3,624. Both declined as reflected in a general softness in the impact of shifting macro signals and softer institutional demand.
3. How is the Federal Reserve important to crypto prices?
The Federal Reserve significantly influences crypto prices based on its interest rate decisions; these decisions affect how money flows globally. As US interest rates drop or slow to fall, interest in other risky investments declines, and some portfolios are reallocating cash out of crypto.
4. Are long-term holders of crypto selling their crypto?
No, according to on-chain data, it appears that long-term holders are not selling their long-term holdings. Long-term holders are also buying more coins, which lends some confidence to the longer-term growth of crypto, despite the shorter-term price fluctuations.
5. What could cause the crypto market to bounce?
A softer US inflation reading, a decrease in ETF redemptions, or when institutional buyers re-enter the market could help a bounce. Additionally, without any hawkish comments from the Fed, bullishness could also support itself.
