Top 5 Reasons Why Crypto Prices Are Going Down Today?

The crypto market is bleeding heavily today, losing more than 2% of its market cap, amid a massive selloff recorded in the broader financial market. Crypto prices, including Bitcoin, Ethereum, XRP, SOL, and others, have moved south, reflecting the waning risk-bet appetite of the investors.

So, here we take a quick tour of the top five probable reasons that might have weighed on the crypto prices today.

Middle East Tension Spooks Crypto Market

The ongoing Iran-Israel war has spooked global investors this week, impacting the waning risk-bet appetite of the investors. Besides, the White House said this week that the US will provide a final decision on its involvement in the Middle East conflict within two weeks.

This statement, with Donald Trump’s latest comment on the Iran-Israel conflict, has sparked discussions in the financial market. Considering that, the latest dip in crypto prices could be due to investors seeking more cues on what lies ahead amid the soaring geopolitical tension.

Fed Rate Cut Uncertainty Weighs on Crypto Prices

The uncertainty over the US Federal Reserve’s stance on its policy rate plans has continued to weigh on the investors’ sentiment throughout the year.

Although the market has shrugged off concerns previously, given the pro-crypto regulatory shift in the US, the latest crypto market movements suggest otherwise.

The US central bank has maintained the interest rate at the latest FOMC. However, the market confidence was buoyed slightly on Friday by Fed Governor Christopher Waller’s comments.

In his latest comment, Waller hints at a potential rate cut as soon as July. He also said that the tariffs might not boost the inflationary pressure in the nation, which has sparked hopes among traders.

However, it contradicts Fed Chair Jerome Powell’s comment. Powell said that the central bank would consider the upcoming data before coming to any decision, despite continued pressure from President Trump to trim the policy rates.

Stock Market Retreat

Another potential reason behind the latest crypto prices drop could be due to the stock market retreat. It is often seen that Bitcoin tends to follow the S&P 500 performance.

Having said that, the latest stock market dip could have weighed on the crypto market sentiment.

Meanwhile, the geopolitical turmoil and macroeconomic factors have continued to impact the broader financial market sentiment.

So, as Bitcoin is moving in tandem with the US Stock market, the top altcoins might also have followed suit.

Crypto Market Liquidation

The latest crypto liquidation also indicates the waning risk-bet appetite of the investors. Besides, as the crypto prices have recorded a significant surge recently, with BTC touching a new ATH, some investors might be booking profits amid the soaring market uncertainties.

The crypto market witnessed a massive $458.43 million liquidation in the past 24 hours, with 124,635 traders affected, according to CoinGlass data.

Ethereum bore the brunt, with $157.41 million in long positions and $13.72 million in short positions liquidated. The largest single liquidation order, valued at $8 million, occurred on Bybit for BTCUSD.

Bitcoin ETF Inflow Declines

The sudden low institutional interest in Bitcoin might have also triggered the current crypto prices dip. According to Farside Investors’ data, US Spot Bitcoin ETF recorded an inflow of only $6.4 million on Friday.

However, the weekly inflow was recorded at a staggering $1.02 billion. So, the slowing influx into the investment instrument indicates that the institutions are also playing safe amid the ongoing market uncertainties.

Simultaneously, US Spot Ethereum ETF recorded the first weekly outflow on Friday, totaling $11.3 million. Notably, Ethereum price was also one of the top laggards today among top coins, losing more than 5% during writing.