why crypto is down today

The cryptocurrency market is down today primarily due to a combination of heavy liquidations of long positions, regulatory uncertainty, and macroeconomic factors. Bitcoin fell below $112,000, dragging the overall market cap to about $3.9 trillion. Over 400,000 traders were liquidated in the past 24 hours, erasing $1.7 billion in positions, mostly from long traders. Additionally, there are concerns about over $517 million in token unlocks in the coming week, which could add selling pressure. Regulatory developments also contributed to the downturn. The SEC issued updated guidelines on crypto ETFs, which were stricter and dampened sentiment, especially for altcoins. The U.S. Treasury's potential reserve rules on stablecoins add further uncertainty. The crypto market is also reacting to excessive leverage in derivatives, especially with a rise in open interest but slightly negative funding rates, signaling long position flushouts. Altcoins, including Ethereum, Dogecoin, and XRP, suffered significant losses, with Ethereum alone seeing $210 million in liquidations. Bitcoin dominance increased as investors rotated from altcoins to Bitcoin amidst the market weakness. The overall investor sentiment is cautious with the Fear & Greed Index around neutral levels. Lastly, market pressure also came from a bearish stance by the Federal Reserve and ETF outflows for Bitcoin and Ethereum, alongside the market downturn coinciding with major market openings in Europe and Asia, amplifying selling pressure. In summary, the crypto market is down today due to heavy trader liquidations, regulatory pressures, leveraged positions unwinding, and cautious investor sentiment amid macroeconomic uncertainties.