Simply put
- The total value of all cryptocurrencies dropped by 5.9% to $3.64 trillion on Friday morning, hitting its lowest point since July 2025.
- This sell-off seems to be a result of a “flight to safety,” fueled by worries surrounding the stability of U.S. regional banks.
- Major altcoins saw significant declines, with liquidations totaling $1.09 billion, and BNB had the steepest drop.
Cryptocurrency markets faced increased losses on Thursday as a decline in Bitcoin triggered a wave of additional liquidations, bringing many altcoins down to multi-week lows.
Leading this downturn, Bitcoin fell 5.6% over 24 hours, reaching an intraday low of $104,853, according to CoinGecko data.
The overall market cap for cryptocurrencies fell by 5.9%, now at $3.64 trillion, the lowest it has been since July, as per CoinGecko.
Derek Lim, who leads research at Caladan, pointed out that the stock market’s decline appears to be driven by a shift towards safer assets amid increasing fears regarding the U.S. regional banking sector’s stability.
He attributed the panic to traditional finance issues, noting that reports of loan book troubles with banks like Zions Bank and Western Alliance led to plummeting bank stocks, which then affected risk assets.
“Risk appetite has diminished significantly across the markets as concerns spread in the financial sector,” Lim said. “It’s no surprise that cryptocurrencies followed suit as traders sought safer havens.”
Altcoins, still reeling from last week’s abrupt crash, experienced notable corrections. Ethereum itself dropped 7.4%, while XRP, Solana, Tron, Dogecoin, and Cardano recorded losses between 4% and 9%. BNB took an even harder hit, falling 12.3% in just 24 hours.
This widespread downturn forced a significant unwinding of leveraged positions, leading to total liquidations of $1.09 billion, with Bitcoin and Ethereum accounting for over 55% of this total, according to data from CoinGlass.
Despite these unsettling signals coming from traditional finance, Lim maintains an optimistic view about the broader crypto landscape, referencing a “bullish market structure.”
As a user of prediction markets, Lim’s cautious perspective seems somewhat validated by market sentiment data. Predictions from Myriad suggest a 66% chance of Bitcoin trading positively in October, hinting at underlying optimism for a potential recovery.
Nonetheless, in the near term, traders are leaning bearish. Predictions on Bitcoin’s next movement show increasing odds for a drop to $100,000 instead of rising to $120,000, with probabilities rapidly climbing to 68% early Friday morning.
