Bitcoin, Ethereum, and Solana Plunge as Investors React to Trump’s Economic Policies and Market TrendsCrypto Market Nosedives: What’s Behind Today’s Sharp Decline?

The cryptocurrency market has taken a sharp downturn, wiping out gains from President Donald Trump’s recent US Crypto Strategic Reserve announcement. Over the past seven days, the total market capitalization has plunged 14.7%, falling to $2.7 trillion as of March 10, 2025.

A combination of factors is driving the sell-off, including Trump’s recent economic remarks, massive liquidations in the derivatives market, and continued outflows from institutional crypto investment products.

Trump’s Economic Policies Spark Market Uncertainty

President Trump’s comments on his administration’s economic strategies have unsettled investors. While his pro-crypto stance initially fueled optimism, his acknowledgment of potential short-term economic pain has dampened sentiment.

“There could be a little disruption,” Trump told Fox News, referencing his trade tariffs on Canada, Mexico, and China, as well as budget-cutting measures.

This shift in tone has contributed to the latest downturn, with major cryptocurrencies deep in the red:

• Bitcoin (BTC) dropped 4% in the last 24 hours.
• Ethereum (ETH) fell 3.2%, trading just above $2,000.
• Solana (SOL) plunged 7.2%, while XRP (XRP) declined 4.5%.

Liquidations Mount as Long Positions Collapse

A wave of liquidations in the derivatives market has intensified selling pressure. In the last 24 hours alone, a staggering $650.80 million worth of positions were liquidated, with long traders bearing the brunt:

• $595.75 million in long positions were wiped out.
• Bitcoin liquidations totaled $264.22 million, while Ethereum saw $114.76 million in forced sell-offs.

When long positions are liquidated, traders’ holdings are automatically sold, increasing supply and pushing prices further downward—a vicious cycle currently gripping the market.

Institutional Investors Continue Pulling Out of Crypto

Adding to the pressure, institutional investors are unloading crypto investment products at an alarming rate. According to CoinShares, digital asset funds saw outflows of $876 million in the week ending March 7, marking the fourth consecutive week of withdrawals.

Key figures highlight the bearish sentiment:

• $4.75 billion has exited crypto funds over the past four weeks.
• Bitcoin products faced the largest outflows, totaling $756 million.
• Total assets under management (AUM) have fallen by $39 billion, now sitting at $142 billion—the lowest level since November 2024.

James Butterfill, head of research at CoinShares, warned that investor sentiment is on the verge of capitulation, with the Crypto Fear & Greed Index plunging to 10, signaling extreme fear—its lowest reading since July 2022.

Descending Triangle Breakdown: What’s Next for Crypto?

From a technical analysis standpoint, the market’s decline aligns with a bearish descending triangle pattern in TOTAL—the total cryptocurrency market capitalization.

This pattern, characterized by lower highs and a flat support level, was confirmed when TOTAL broke below support, triggering a sharp move toward its technical target of $2.6 trillion at the 50-week Simple Moving Average (SMA).

• If selling pressure persists, the next key support lies at the 100-week SMA around $2 trillion.
• Holding the 50-week SMA as support could trigger a recovery toward $3.1 trillion, but sustained buying interest is needed.

As investors weigh macroeconomic risks against crypto’s long-term potential, the coming weeks could determine whether this pullback is a temporary setback or the start of a deeper correction.