Malaise in crypto markets as bitcoin drops below $90,000
Despite the Trump administration’s crypto-friendly outlook, cryptocurrency markets are characterised by extreme fear and fluctuations. Bitcoin briefly dropped to $89,420 on Tuesday night – the lowest level since February and just six weeks after reaching a record high of around $126,250. The Crypto Fear & Greed Index fell to 11 on Monday, the lowest reading since the bear market of 2022.
Bitcoin (BTC) dipped below $90,000 in the early hours of Tuesday, wiping out all gains for 2025. Ethereum (ETH) also slid below a key support level. XRP lost 3.6%, while Solana (SOL) fell by more than 5% in just 24 hours.
The price decline accelerated after Bitcoin failed to reclaim support around $93,700 over the weekend.
US spot ETFs, exchange-traded crypto funds that earlier this year amassed more than $25 billion, have come to a standstill for nearly two weeks due to concerns over inflation tied to the Trump administration’s rate policy and the delay in interest rate cuts.
The start of a bear market, in which prices remain depressed for an extended period, now seems almost inevitable.
The stablecoin market is growing rapidly – especially in the US – and now exceeds $300 billion. Stablecoins are a form of cryptocurrency pegged to a currency, almost always the US dollar. They are partially backed by (US) government bonds and bank deposits, and are mainly used for buying crypto-assets. If many investors were to sell their stablecoins simultaneously, it could lead to forced sales of underlying assets and abrupt movements in the financial markets.
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