A wave of fear has swept across the crypto world as Bitcoin and altcoins nosedive, sending shockwaves through investors. With the Crypto Fear & Greed Index plunging into extreme fear territory and billions wiped from the market overnight, traders are bracing for what could come next.
“An Economic Nuclear War”
The crypto sell-off was triggered by rising fears of a global tariff war, which investor Bill Ackman called an “economic nuclear war.” The uncertainty is rattling markets, dragging Bitcoin down over 9% and pushing major altcoins down by up to 14%. XRP, Cardano (ADA), and Dogecoin (DOGE) have all dropped below key support levels as of Monday morning.
Notably, the Fear and Greed Index dropped into “extreme fear” to 17 as per data from Coinmarketcap. Bitcoin tumbled to $75,000, dragging the total crypto market cap down nearly 10% to $2.4 trillion. Berachain led the plunge with a 21% crash to a record low of $4.6 — now down over 50% from its peak. Top tokens like AAVE, Litecoin, Lido DAO, Maker, Movement, and Ethena also fell sharply, losing more than 15%.
Over $1 billion in crypto positions were liquidated as markets crashed, with Bitcoin and Ethereum accounting for $638 million combined. More than 324,000 traders were hit, including one Bitfinex user who lost a staggering $23 million. The Fear & Greed Index tumbled to 17, signaling extreme fear across the market.
Charlie Sherry from BTC Markets said the drop isn’t shocking because markets are usually illiquid on Sundays. That means a few big sales can cause prices to fall quickly.
US Crypto Wallet Reveal To Spark Relief Rally?
Edul Patel, co-founder and CEO of Mudrex, noted that investor sentiment is currently weak, with the Fear and Greed Index approaching “Extreme Fear.” However, he notes that there may be a silver lining as the U.S. federal agencies are expected to reveal their crypto holdings later today, and a strong disclosure could spark a much-needed relief rally.
Federal agencies must disclose their Bitcoin and crypto holdings to Treasury Secretary Scott Bessent by Monday, a White House official confirmed to journalist Eleanor Terrett. The reports could offer new insights into the government’s digital asset exposure.
Besides, some traders believe a Bitcoin breakout could be near, despite current market chaos. BitMEX co-founder Arthur Hayes suggests that while global tariffs are shaking markets, they might actually spark a Bitcoin rally.
