Though the trading days since March 11, and particularly since March 23, brought renewed hope for cryptocurrency investors with, for example, Bitcoin (BTC) rallying nearly 10% within two weeks, the 24 hours between Thursday and Friday moved the needle back into fear.
The 24 hours leading up to press time on March 28 generated a 3.70% market-wide crash that ensured the total market capitalization of digital assets plummeted by just over $100 billion to $2.71 trillion.
The valuation and price drop has been accompanied by a new shift in the ‘Fear & Greed Index,’ per the data retrieved by Finbold from CoinMarketCap. Specifically, investor sentiment hit 12-month lows earlier in March, only to enter a sharp recovery in more recent sessions.
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The latest plunge abruptly ended the positive shift in attitudes, ensuring that the index is, at its press time value of 33, close to the previous 2025 lows and significantly under anything seen between March 2024 and February of the current year.
Why Crypto is crashing today
Furthermore, the attitudes displayed by the ‘Fear & Green’ appear to be the main driver behind the latest plunge. For all the positivity, the cryptocurrency market has been extraordinarily susceptible to external bearish factors in the last 12 months and indifferent to internal bullish developments.
The latest $100 billion, 24-hour plunge likewise appears to have started due to the contagion from the stock market, where the Magnificent 7 became something of an S&P 500 loss leader earlier this week, only to be followed by the automotive industry on Thursday.
The root cause behind the selloff is a combination of President Donald Trump’s tariffs and the growing fears that Silicon Valley may be facing a Dot-com-like crash due to the alleged data center bubble.
Looking beyond just the latest woes, much of the 2025 market troubles can be linked to President Trump’s approach to international relations – political, as well as economic – growing competition from China, and the fact inflation is once again on the rise.
The fact that the stock and cryptocurrency markets enjoyed an exceptionally strong 2024 is, likewise, not helpful as it had both created the conditions for a bearish correction, and increased fears that certain sectors might have inflated into dangerous bubbles.
Long-term positivity persists despite short-term bloodbath
Despite the grim short-term picture, analysts, insiders, moghuls, and the community have remained relatively bullish by press time. For example, Strategy’s (NASDAQ: MSTR) Michael Saylor opined that Bitcoin’s market capitalization could eventually hit $500 trillion when speaking at the 2025 Blockchain Summit.
The latest prediction is a significant upgrade from the 2021 $100 trillion prediction and, arguably, a significant stretch.
On the topic of another popular cryptocurrency, XRP, Ali Martinez, an established cryptocurrency analyst on X, maintained on March 28 that the token could flip back to a bullish outlook, provided it climbs above $3, as Finbold reported earlier on the day.
The cryptocurrency community likewise remains optimistic with the XRP predictions, though Friday could sour the situation as multiple analyses have identified March 28 as an important day for the token.
