Crypto Market Retreats Amid Macro Concerns and Rising Leverage
After a stretch of record-setting highs, the crypto market is cooling as traders take profits and macroeconomic headwinds resurface.
Bitcoin (BTC) slipped to $113,500, down more than 1.5% on the day, while Ether (ETH) dropped 1.8% to $4,159. The pullback comes as analysts raise red flags about the market’s structure and rising leverage.
“Bitcoin’s drop below the 50-day moving average signals potential for a deeper correction,” said Alex Kuptsikevich, chief market analyst at FxPro. “A move toward the $100,000 mark—close to the 200-day average—can’t be ruled out.”
The total crypto market capitalization declined another 0.4% to $3.87 trillion, deepening concerns of a broader correction. Kuptsikevich added that a dip toward $3.6 trillion is now on traders’ radars.
Altcoins also retreated:
- XRP slid 4.1% to $2.89
- Dogecoin (DOGE) lost 2.4% to $0.2185
- Cardano (ADA) led losses, falling 6.6%
Profit-Taking Meets Macro Uncertainty
The mood has shifted sharply, with stronger-than-expected U.S. inflation data dampening hopes for near-term Fed rate cuts. That, combined with elevated leverage across the market, triggered a wave of short-term selling.
“Bitcoin has entered a minor corrective phase,” said Joel Kruger, strategist at LMAX Group. “The hotter inflation print disrupted the bullish momentum.”
Ethereum tracked bitcoin’s move lower, as leveraged long positions were unwound. Still, ETF inflows and growing institutional allocations to ETH suggest a constructive medium-term outlook.
Leverage Risk Rising
Open interest in crypto futures is hovering near record highs, raising the risk of volatile moves.
“Excessive leverage is a double-edged sword—it fuels rallies but also magnifies declines,” said Ryan Lee, chief analyst at Bitget. “Right now, it’s exposing BTC and ETH to sharper swings.”
All Eyes on Jackson Hole
Markets are now focused on Fed Chair Jerome Powell’s upcoming remarks at the Jackson Hole symposium, where he’s expected to signal the central bank’s policy stance heading into the fall. The outcome could ripple across risk assets, including equities, currencies, and crypto.
Despite the recent dip, analysts say institutional engagement remains strong, and underlying fundamentals continue to mature—even if price action struggles to keep pace.
