The crypto market crashed today due to a combination of factors. *Rising U.S. Treasury Yields* triggered a broad risk-off sentiment, impacting equities and cryptocurrencies. The 10-year U.S. Treasury yield rose to 4.70%, making traditional investments more attractive and drawing capital away from riskier assets like cryptocurrencies .
Another significant contributor was the *Hawkish Federal Reserve Outlook*. The Federal Reserve's minutes from the December meeting indicated lower interest rate cuts in 2025 than earlier projected, leading to concerns about continued inflation and stricter monetary policies . This stance adds pressure to the crypto market, making cryptocurrencies less attractive due to higher interest rates.
Additionally, *Macro Uncertainty and Broader Economic Concerns* played a role in the crash. Fiscal policies under President Donald Trump and the looming debt ceiling have created investor unease, while rising fiscal deficits and unclear Treasury strategies further impacted market confidence .
Other factors contributing to the crash include:
- *Disappointing Nonfarm Payrolls Data*, which revealed weaker-than-expected job growth
- *Rising Recession Fears*, sparked by the weak jobs report
- *Bitcoin Long Liquidations*, with $945.67 million worth of long positions liquidated
- *Stock Market Decline*, with the Nasdaq Composite losing 2.43%
- *Bitcoin and Ethereum ETF Outflows*, totaling $237.4 million and $54.3 million, respectively
These factors combined led to significant losses across major cryptocurrencies, including Bitcoin, Ethereum, and Dogecoin .
