🌎 Crypto Market Crashes 8.7 Percent

Crypto Market Flash Crash: What Happened and What’s Next for Bitcoin and Altcoins?

The global crypto market cap has dipped by nearly 8.7% in the last 24 hours, hitting $3.52 trillion. While Bitcoin has weathered the storm relatively well, losing a little over 2% to trade at $95,800, most altcoins have taken a significant hit.

Crypto Markets in Freefall

Ethereum has dropped by around 6%, settling at $3,580, while Ripple took a much steeper dive, falling 12.5% to $2.09. Solana, one of the industry’s top blockchain platforms, has also declined by 6% to trade at $210. The real bloodbath unfolded in the meme coin segment, with Solana-based meme coins in the Pump.fun ecosystem plummeting by nearly 25%.

Unraveling the Flash Crash: What Went Wrong?

According to a detailed analysis, the events leading to the sudden crash unfolded in stages, influenced by a mix of market structure weaknesses, high leverage, and liquidity issues. The sell-off began with aggressive selling on exchanges, where traders started offloading assets nearly an hour before the major crash.

This persistent selling pressure gradually pushed Bitcoin‘s price into a precarious zone, setting the stage for a liquidation cascade. When prices dip below certain thresholds, overleveraged positions are forcibly closed by exchanges, creating a domino effect as each liquidation exerts further downward pressure, triggering more liquidations in a self-reinforcing cycle.

The Bigger Picture Amid the Market Chaos

While the flash crash momentarily disrupted the bull run, it’s critical to examine the broader picture to understand what’s cooking in the market. The macroeconomic backdrop continues to play an instrumental role, with the U.S. dollar facing consistent depreciation in its purchasing power. As a result, assets like Bitcoin are effectively pricing in a sustained erosion of dollar strength.

The unprecedented growth of institutional adoption is also adding fuel to the crypto narrative. The spot Bitcoin ETF has shattered records by surpassing $50 billion in assets under management within just 228 days.

What Lies Ahead for Bitcoin and Altcoins?

As the dust settles from the recent crypto market shake-up, the big question is: what’s next for Bitcoin and altcoins? Analysts suggest that the journey to higher highs is far from over, with Bitcoin‘s price likely to break out toward targets between $125,000 and $135,000.

However, not everyone agrees on the immediate path forward. Some analysts hint at the possibility of a multi-week correction if Bitcoin fails to maintain momentum above key levels.

Turning to altcoins, the outlook appears even more intriguing. Some analysts suggest that altcoins are on the verge of breaking out of their longest bear market, with a weakening U.S. dollar and expectations of increased liquidity setting the stage for a giant altcoin rally.