Crypto Under Increasing Pressure: High Interest Rates & Massive Selloff
The cryptocurrency market remained clouded by global risk-off sentiment on Tuesday after Bitcoin briefly plunged below $90,000 for the first time in seven months, before rebounding slightly to around $93,000. This sharp correction virtually erased all of Bitcoin's gains throughout 2025, while Ethereum also fell below $3,000, and most altcoins experienced deeper declines.
Fundamentally, the pressure in the crypto market is largely attributed to a combination of persistently high US interest rates, massive outflows from Bitcoin and Ethereum ETFs, liquidity concerns, and weakening risk appetite across risk assets. In the derivatives market, backwardation structures and a sharp decline in futures basis reflect increasing stress, a pattern that has often appeared near the crypto market's capitulation phase, although there is no guarantee that a bottom has been reached.
On the regulatory front, market participants are also closely monitoring Brazil's proposal to tax the use of crypto for cross-border payments, as well as US moves toward tightening reporting and taxation of offshore crypto accounts. This policy adds short-term pressure to sentiment, but also confirms that crypto assets are increasingly being treated as part of the official financial system. Amidst the combination of price corrections, high volatility, and regulatory news, some investors view the current situation as a "blood on the streets" phase that could potentially become a long-term accumulation zone, while others prefer to remain on the sidelines, awaiting confirmation of the next trend direction.
Source: Newsmaker.id
