The cryptocurrency market fell sharply on Tuesday as a wave of liquidations and whale-driven selling pushed Bitcoin and Ether lower, wiping out hundreds of millions of dollars in leveraged positions.
Bitcoin briefly dipped below $109,214 on Tuesday after a single entity offloaded 24,000 BTC worth $2.7b. The sale triggered a rapid $4,000 slide, according to on-chain data. Despite the sale, the whale still controls more than 152,000 BTC valued at over $17b.
Ethereum, which had set a new all-time high near $5,000 at the start of the week, also came under pressure. The second-largest cryptocurrency fell back to trade around $4,405 on Tuesday, down from weekend peaks, although it remains one of the strongest performers in recent weeks.
CoinGlass data showed $941.8m in leveraged positions were liquidated over the past 24 hours. Ethereum accounted for $321.6m of those losses, while Bitcoin saw $261.6m liquidated.
Altcoins were not spared, with Solana dropping 11.6% to $197 and XRP falling 5.3% to $2.88.
The market capitalization of all cryptocurrencies slipped 4.5% to $3.85 trillion, reversing part of the rally that followed Federal Reserve Chair Jerome Powell’s comments at Jackson Hole last week.
At the annual policy symposium, Powell signaled the Fed could move toward cutting interest rates as soon as September, citing risks from a weakening labor market and persistent inflation. His dovish remarks had fueled a surge in risk assets, with Bitcoin and Ether initially leading gains.
However, uncertainty around tariffs and political pressures has clouded the outlook. As a result, some economists expect the Fed to cut rates in September. Meanwhile, most believe the central bank will wait for additional data from upcoming jobs and inflation reports.
Market analysts say the divided outlook has fueled volatility. In response, Gracy Chen, CEO at Bitget, noted that Bitcoin is likely to trade in the $110,000 to $120,000 range over the next two weeks. At the same time, she said Ethereum looks stronger, with targets between $4,600 and $5,200.
“On-chain data shows capital rotation underway, with whales selling Bitcoin to increase Ethereum exposure, further accelerating ETH’s momentum,” Chen said. “This macro easing, combined with sustained ETF inflows and Ethereum’s growing utility, suggests ETH is positioned to outperform in the near term.”
Bitcoin remains supported by institutional demand, analysts say, but Ethereum’s fundamentals, regulatory clarity, and ETF prospects could allow it to lead the next phase of the crypto rally.
