"Market Analysis: Factors Behind Today's Crypto Decline"

What’s Behind the Crypto Market’s Recent Drop?

The cryptocurrency market has experienced a significant decline in the past 24 hours, with the total valuation of all cryptocurrencies dropping by around 3.65% to $2.58 trillion. Several factors have contributed to this downturn, including:

• An ongoing slump in the tech sector.
• Reports of China potentially selling off $16 billion worth of Bitcoin.
• Liquidations in the futures market.
• Weakening technical indicators.

Nvidia Export Restrictions Impact Both Stocks and Crypto

Today, the crypto market’s losses align with a broader decline in the overall market sentiment. The Trump administration's new export restrictions on Nvidia's chips to China have triggered fears of another round of tariffs, leading to a drop in the Nasdaq 100 futures by over 2.30%. This market turbulence has spilled over into the crypto market, which has shown a consistent correlation with US stocks.

On the other hand, gold continues to act as a global safe haven, reaching a new record high of over $3,317 an ounce on April 16th. Gold has outperformed Bitcoin in 2025, signaling a shift in risk appetite among investors.

China’s Potential Bitcoin Sell-Off

Amidst the market decline, reports have surfaced suggesting that China may start offloading seized Bitcoin assets. Chinese municipalities are reportedly selling around 15,000 BTC to counter domestic economic challenges. This move comes after previous reports of China selling off Bitcoin seized from the PlusToken Ponzi scheme.

Recent data shows that the Chinese government holds 190,000 BTC, valued at over $16 billion since January 2024. State-led sell-offs can trigger panic and drive prices lower, as seen in past instances involving Germany and the US.

Liquidations and Technical Weakness Signal Market Volatility

The recent crypto market downturn coincides with $245.37 million in liquidations in the futures market in the last 24 hours. Bitcoin and Ether led the losses in liquidations, emphasizing the market’s volatility.

From a technical perspective, the crypto market failed to break above a multimonth resistance level, signaling further downside potential. The market is currently retesting the upper boundary of a descending channel, with indicators pointing to a bearish bias. The Relative Strength Index is also signaling weakening buying pressure.

Unless the market decisively breaks above key resistance levels, the setup favors continued downside towards $2.2 trillion. Investors and traders should conduct their research and exercise caution in the current market environment.

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