The cryptocurrency market has experienced one of its most turbulent weeks since July 2024, with sudden price drops and heightened risk of new breakdowns. Bitcoin hovered near $62,500, retreating over 14.5 percent since the start of the week. Ether took an even sharper hit, plunging more than 17 percent overall and losing 5.5 percent in value on Friday alone.
Mounting pressure on Bitcoin and Ether
Ether, the market’s second-largest asset, slipped to its lowest level seen since April 2025. Back then, ETH had bounced at $1,420 before surging toward historic highs over the next four months. If Ether drops below this threshold, analysts warn it could approach its 2022 bear market lows, potentially dipping under $900.
The selloff extended well beyond major coins, hitting the broader altcoin segment with sweeping declines. Zcash delivered one of Friday’s weakest performances after a cybersecurity researcher revealed a vulnerability in its shielded pool that could potentially enable unlimited token creation. ZEC subsequently tumbled over 30 percent.
Mini Glossary: A vulnerability is a flaw in software or a protocol that could potentially be exploited. A “shielded pool” in the Zcash network refers to a special transfer structure that enhances privacy by hiding transaction details on chain.
Michael Saylor, Chairman of Strategy Management, attributed the weekly downturn to a shift in capital following artificial intelligence IPOs in the United States. On-chain analysts monitoring market data observed that weak spot market volumes have accelerated the drop in prices.
Spot and derivatives data point to waning demand
According to data from CryptoQuant, spot trading volume sank to $679 billion in April, marking the lowest monthly figure since October 2023. This decline highlights a significant drop in investor appetite for crypto assets.
Bitcoin’s derivatives market is also flashing warning signs. Open interest slid 15 percent this week to $17 billion. Funding rates turned negative or flat across many platforms, signaling a rapid unwinding of leverage. On Deribit, the rate fell to an annualized minus 15 percent, with the three-month rate slipping from 2.9 to 2.7 percent.
Defensive positions have surged in the options market. In the last 24 hours, put and call volumes evened out at a 50 50 split, while the one week 25 delta skew ballooned from 13 to 27 percent. This sharp increase reflects a jump in demand for downside protection. Meanwhile, the front end implied volatility gauge, DVOL, climbed to 47.
Liquidations hit $1.2 billion
Coinglass data shows that a total of $1.2 billion in positions were liquidated over the last 24 hours. Of this, 76 percent were long and 24 percent were short positions. Bitcoin led the nominal liquidation totals at $364 million, followed by Ether with $291 million and Zcash at $107 million. Binance’s liquidation heatmap now points to $60,900 as the next key threshold for Bitcoin in the event of renewed declines.
Losses in ZEC deepened after Arthur Hayes, founder of BitMEX, revealed that his company had sold off its entire token allocation. Cardano also dropped more than 10 percent, while its founder Charles Hoskinson announced he would be taking a break after drawing attention to internal issues in the ecosystem. Even artificial intelligence focused tokens that had outperformed earlier in the week, such as FET, NEAR, and TAO, lost steam and fell between 4 and 6 percent.
Despite the sweeping declines, there was a glimmer of hope for altcoin investors. The average relative strength index (RSI) across crypto pairs slipped into oversold territory. This could point to the possibility of a short lived rebound over the weekend, but market sentiment remains fragile.
