 ▲ Bitcoin (BTC) plunge / Gemini-generated image |
Major cryptocurrencies, including Bitcoin (BTC), are plunging simultaneously amid macroeconomic uncertainty and large-scale liquidations, sharply dampening investor sentiment.
According to CoinGape on February 23 (local time), the sudden downturn in the crypto market reflects investor anxiety ahead of the U.S. January PCE price index scheduled for release this Friday. As the Federal Reserve’s preferred measure of inflation, a higher-than-expected reading could weaken expectations for interest rate cuts, weighing heavily on the market. Market experts warned that “if inflationary pressures persist, Bitcoin prices could fall into further correction.”
Donald Trump’s proposed 15% global tariff hike policy has also emerged as a key factor increasing volatility across asset markets. Higher tariffs could drive up import prices, potentially reigniting inflation and prolonging the Federal Reserve’s tightening stance. Following Trump’s policy announcement, the strengthening U.S. dollar has accelerated capital outflows from risk assets, including Bitcoin.
In the futures market, cascading liquidations triggered by falling prices have intensified the decline. After Bitcoin broke below the key support level of $68,000, long positions betting on a rally were forcibly liquidated, creating a vicious cycle of selling pressure. Major altcoins such as Ethereum (ETH) and Solana (SOL) also lost key support levels, posting double-digit losses as market fatigue reached extreme levels.
Amid stalled inflows into spot Bitcoin ETFs, profit-taking by large whales has also been detected. In particular, XRP and Cardano (ADA) have experienced relatively steep corrections as investors rushed to realize gains from recent rallies. In the face of macroeconomic uncertainty, investors are opting for cash over holding assets, absorbing liquidity from the market.
The cryptocurrency market is expected to remain highly volatile for the time being, depending on inflation data and policy changes. Bitcoin is testing support near the $64,000 level, while XRP and other altcoins are battling to confirm their bottoms. Market participants are closely monitoring Friday’s inflation data release and the capital movements of major investors to shape their response strategies.
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