The bloodshed in the crypto markets shows no sign of stopping. Bitcoin hit its lowest level in the past three months at 86,000 dollars. Analysts have noted that Bitcoin is at a critical juncture. Here are the reasons behind the market downturn.

Selling pressure in the crypto markets deepened. The market’s largest asset, Bitcoin, plummeted by over 10% this week. Yesterday, Bitcoin tested 86,000 dollars with a loss of over 5%, marking its lowest level since November 2024. The leading cryptocurrency is now trading around the 89,000-dollar mark propelled by buying activity at the bottom. In addition, the market’s second-largest asset, Ethereum, dropped to 2,300 dollars. Today, ETH is hovering around 2,500 dollars.

Moreover, a massive daily outflow of 938 million dollars was recorded from spot Bitcoin exchange-traded funds (ETFs) yesterday. In February, there was a total net outflow of 2.4 billion from ETFs. WHY IS BITCOIN DROPPING? A sharp decline in the crypto markets followed comments by US President Donald Trump regarding tariffs. Trump had announced the continuation of tariffs on imports from Canada and Mexico. Concerns arise that trade wars may trigger inflation, potentially hindering central banks from reducing interest rates. President Trump has also ordered an investigation into copper trading. Analysts highlighted that Bitcoin is increasingly intertwined with traditional markets. With growing macroeconomic uncertainties, analysts emphasized that Bitcoin is facing a critical juncture. MEME COIN CRASH BEGINS Among the factors contributing to the market drop is the declining demand for meme coins. Standard Chartered analysts noted an increase in meme coin-related selling on the Solana network, despite Bitcoin trading relatively well. This indicates a trend of investors moving away from risky assets. The meme coin frenzy was highlighted by the involvement of Argentine President Javier Milei in the LIBRA scandal. Supported by Milei, LIBRA quickly reached a value of 4.5 billion dollars before plummeting by 95%.

The end of the meme coin frenzy escalated losses in Solana and associated crypto assets. THE LARGEST CRYPTO ATTACK IN HISTORY Over the weekend, a massive cyberattack targeted the crypto exchange Bybit. The attackers seized 401,000 Ethereum, with the stolen assets estimated at 1.5 billion dollars. Following the attack, Ethereum and related cryptocurrencies experienced sharp declines. The attack is allegedly attributed to the North Korean Lazarus Group.