Crypto market approaches $3 trillion floor as bitcoin, ether, and XRP slip

Crypto markets continued their pullback on Wednesday, with total capitalization falling below $3 trillion for the third time this month, testing a level that could pave the way for further weakness.

The declines were concentrated in large-cap tokens, particularly those with heavy ETF exposure, indicating the move stems more from institutional repositioning than broad retail selling. Bitcoin (BTC) slipped 1.5% to $86,580, partially reversing Tuesday’s gains, while ether (ETH) retreated to $2,930 from an overnight high near $2,980. XRP’s recovery stalled around $1.90, according to CoinDesk data. These major assets, which benefited from early-year institutional inflows, are now leading losses as sentiment cools.

“Major coins are increasingly victims of shifting institutional sentiment,” said Alex Kuptsikevich, chief market analyst at FxPro, adding that investors are reassessing risk heading into year-end.

Bitcoin’s weakness contrasted with moderate gains in key Asian equity markets, including the Hang Seng, Shanghai Composite, Kospi, and IDX, which were buoyed by expectations of Beijing fiscal stimulus after weak November economic data.

Macro factors also weighed on crypto. The U.S. dollar index recovered to 98.30 from a 2.5-month low of 97.87 following jobs data showing 64,000 positions added in November—above forecasts—while unemployment rose unexpectedly to 4.6%, its highest since 2021. A stronger dollar generally pressures BTC and other dollar-denominated assets, although gold remained firm above $4,300 per ounce.

Sentiment and technical outlook

Crypto sentiment has deteriorated sharply. The Fear & Greed Index dropped to 11, its lowest in a month, signaling extreme fear. Unlike earlier short-lived pullbacks in February and April, the current decline shows signs of a broader correction, with several large-cap assets breaking key support levels. BTC’s next significant support zone is near $81,000, where November lows align with March consolidation levels. A deeper pullback could expose the $60,000–$70,000 range, historically significant from prior cycles in 2021 and 2024.

Liquidity pressures

Thin liquidity has amplified price moves. FlowDesk data indicate declining market depth and subdued leverage as traders close positions into year-end, while overall exchange volumes remain weak.

On-chain indicators show a mixed picture. CryptoQuant suggests the recent BTC rally may have exhausted itself, pointing to a potential corrective phase, whereas Glassnode notes continued long-term accumulation by corporations and financial firms. Strategy’s recent purchase of 10,624 BTC—nearly $1 billion—underscores selective accumulation despite weakening short-term momentum.