Why is the crypto market down today?

Key points:

• The total crypto market cap fell 2.60% to $3.34 trillion on May 30, fueled by stalled US-China trade talks.

• Over $683.4 million in crypto futures liquidated, with $617.85M in longs reinforcing the intensity of the selling pressure.

• Total crypto market cap risks falling toward $3.1 trillion after breaking below a descending parallel channel.

The combined valuation of all cryptocurrencies has fallen by around 2.60% in the past 24 hours to reach $3.34 trillion on May 30. 

Let’s look closer at the factors driving the crypto market down today.

Bitcoin leads crypto market slump

Crypto prices began falling during the late New York trading hours on May 29 after US Treasury Secretary Scott Bessent’s confirmation of stalled trade negotiations with China dampened investor sentiment and triggered a risk-off mode in the market.

“I would say that they are a bit stalled,” Bessent said in a Fox News interview on May 29, adding that it would require the leaders of the two countries to speak directly to reach a deal.

“I think that given the magnitude of the talks, given the complexity, that this is going to require both leaders to weigh in with each other. They have a very good relationship and I am confident that the Chinese will come to the table when President Trump makes his preferences known.”

In response, Bitcoin (BTC) dropped by 2% to as low as $104,600 on Bistamp. The decline in BTC triggered panic selling among crypto investors, with cryptocurrency prices dropping.

Ether (ETH) extended its two-day losses, dipping as low as $2,560 on May 30, marking 4% losses over the last 24 hours.

XRP (XRP), Solana (SOL) and Dogecoin (DOGE) also witnessed significant losses, down 4.2%, 5.2% and 9%, respectively. 

Stalled negotiations may signal prolonged geopolitical tension, further eroding confidence in speculative assets like Bitcoin and altcoins.

As a result, crypto prices experience drawdowns as investors react to the heightened risk and lack of progress in resolving trade disputes.

Crypto market suffers $680M in liquidations

The cryptocurrency market’s sell-off today coincides with a wave of liquidations in the futures market, totaling $683.40 million in the last 24 hours.

Notably, the futures market witnessed long liquidations worth $617.85 million of the total wipeout. In comparison, short traders saw significantly lower liquidations at $65.55 million.

Bitcoin and Ether led the losses with $211.21 million and $112.53 million in liquidations, respectively. Solana followed with $31.69 million, while XRP and Dogecoin saw $29.42 million and $21.39 million liquidated, respectively.

This scale of liquidations not only exacerbates price drops but also instills fear among other market participants, leading to further selling pressure. 

Related: Crypto has a structural optimism built to withstand crises

Crypto market’s weakening technicals

From a technical standpoint, the crypto market’s ongoing decline is occurring after breaking below multi-week support at around the $3.35 trillion level.

The chart below shows the market retesting the major support at $3.22 trillion. Note that the last time TOTAL — the combined market capitalization of all cryptocurrencies — fell below this level was on Feb. 24, triggering a 26% drop in the price.

The relative strength index (RSI) has dropped to 52 from overbought conditions at 79 on May 10, suggesting increasing downward pressure.

If TOTAL drops below $3.22 trillion, the market risks dropping toward the lower boundary of the 200-day simple moving average (SMA) at $3.1 trillion in the short term.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.