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- The crypto market has plunged from recent highs, raising questions about whether the market has entered a bearish phase.
- The Fed’s decision to hold interest rates steady is a factor contributing to the recent market downtrend.
Currently, discussions have arisen about whether the recent bull run is sustainable. Some analysts and enthusiasts think the bull market might be over due to declining crypto prices.
However, others claim there is still room for a potential rebound in the coming weeks.
Bitcoin Leads Market Drawdown
So, what is sparking the negative sentiments in crypto prices? Before we answer this question, let’s look at the journey some cryptocurrencies have embarked on to get to their current position.
First on the list is Bitcoin (BTC), the leading market coin. According to our data, BTC is currently traded at $115,564, demonstrating a 2.3% decrease over the past 24 hours.
This is a sharp decline for a coin that reached an all-time high (ATH) of $123,091 on July 14, 2025. Nonetheless, BTC even remained steady at the $118,000 levels, despite volatility in the broader crypto market.
Following the latest price rally, analysts projected that BTC could hit $140,000. In a recent study we reported on, these analysts based their predictions on a potential short squeeze.
In a bolder prediction, BitMEX co-founder Arthur Hayes set the $250,000 target for BTC, as we discussed earlier. Hayes based his BTC prediction on massive government spending and negative real rates.
Note that altcoins like Ethereum (ETH), XRP, Solana (SOL), and Dogecoin (DOGE) were not left out of the July rally. Ethereum price soared to as high as $3,940, SOL surged to $205, and XRP rallied to a cycle high of $3.65.
Why Crypto Prices Are Falling
However, crypto prices have plunged from their recent highs, raising concerns among traders and investors. Ethereum has plummeted 6.6% to $3,615, XRP decreased by 3.9%, and DOGE dropped 6.2%.
Memecoins like BONK, Pump.fun (PUMP) and SPX6900 (SPX) decreased by over 11%, 15%, and 15.7%, respectively. These losses reflected the broader market’s performance over the past few days.
The price decline in these cryptocurrencies is not random. It comes amid a mix of macroeconomic pressure and shifting investor sentiment.
Analysts attributed the price decline to the U.S. Federal Reserve’s decision to maintain a tighter policy stance.
The Federal Reserve kept interest rates steady between 4.25% and 4.5%, a move that disappointed investors. They had hoped for an easier monetary policy to drive risk assets higher, including cryptocurrencies like Bitcoin.
Another factor weighing on crypto is the newly passed GENIUS legislation. GENIUS aimed to crack down on illicit digital currency-based transactions. However, concerns were raised that it could reduce investor confidence in the short term.
For now, the path towards a market uptrend remains uncertain. However, recent underlying market dynamics, like a possible interest rate cut in September, could influence asset prices in the coming months.
