Bitcoin (BTC) lost 2% in red on Monday, falling 2% in 24 hours, bringing weight in the broader market as key tokens fell to 5%, according to data from the Coindesk index.
BTC touched resistance at $84,000 on Sunday, reaching a critical level to surpass the rise and trading potential of over $83,300 in Asian afternoon hours on Monday.
Major such as XRP, Solana (Sol), Cardano (ADA), and Dogecoin (Doge) tanked as much as 5%, while BNB chain (BNB) rose 3% to stand out as the only major in Green.
The crypto market has taken the tier since its sale last week due to worsening US tariffs and macroeconomic conditions. Concerns over the US recession are rising due to Trump’s tariffs, traders say it’s possible chops as the correlation with US stocks remains unharmed.
Still, some people have seen the volatility of altcoins and memecoins in the flat market structure.
“After Trump’s Global Free Finance acquired MNT and Avax, the volume of altcoins has increased, and the latter was also part of Vaneck’s ETF application,” said Nick Ruck, director of LVRG Research, in a telegram message. “This may be a sign that traders and investors will focus on Altcoins in the short term for better profits compared to larger coins like Bitcoin and Ethereum.”
Traders say the current sale may have been caused by the rewinding of traders that are spot-linked with ETFs.
“The current belief is that current divestment is fully driven by a massive ‘multi-strut’ hedge fund strategy that controls macrospace,” Augustine Fan, Head of Insights at Signalplus, told Coindesk in a telegram message.
Multi-Strat (Multi-Strut) trading includes hedge funds using a variety of tactics, including arbitrage, long short positions, and leverage, to maximize returns across asset classes.
In the case of Bitcoin, the popular multi-strut approach is a basic transaction in which the funds buy spot BTC (via ETF) and buy short BTC futures to benefit from differences in price. This is locked with a low risk gain when the spread is preferred.
As profits from base transactions shrink, tougher spreads or market changes will allow the funds to gain starting positions and sell large quantities of Bitcoin and ETF shares. This liquidation pressure may have amplified the sale, particularly amid the tariff-related volatility over the past week.
However, the “buy-the-dip” mentality persists among bulls.
“The market consensus is that this remains a ‘dip’ market while working through tariff volatility,” Fan added, as historic averages are relatively restrained, and economic hard data is likely to outweigh the rapid degradation of soft data.”